SEATTLE — Virginia Mason Franciscan Health confirmed this week it has laid off nearly 400 employees, pointing to “tremendous financial strain” within the state’s health care industry.
The Tacoma-based hospital system, like nearly all Washington hospitals, has taken a financial hit in the past year as inflation, labor shortages and lasting pandemic impacts have come to a head, Kelly Campbell, vice president of marketing and communications, said in a statement this week.
Statewide, hospitals lost more than $2 billion in 2022 — and health care leaders say the financial hole will likely continue growing unless state lawmakers take action on certain proposals from hospitals and staffers this legislative session.
“As a result, we are taking steps to improve efficiency and effectiveness, as well as reduce our costs,” Campbell said in the statement. “These decisions are not made lightly but are necessary for our continued stability and future growth.”
The cuts hit less than 2% of Virginia Mason Franciscan Health’s workforce, which includes about 19,000 people across 10 hospitals and nearly 300 clinics and other facilities in the Puget Sound region, the hospital system said. Staffers in “non-patient-facing” roles were primarily affected, though a hospital spokesperson was not able to say if others who worked directly with patients, like nurses or aides, were also let go.
Campbell added that those who have been laid off will be eligible for “career transition assistance,” in addition to extended benefits and severance. The hospital declined to share further information about potential future layoffs.
Virginia Mason Franciscan Health isn’t the only hospital system in the area to face mass layoffs. Earlier this year, Overlake Medical Center and Clinics in Bellevue also laid off about 6% of its administrative staff — about 30 employees, the Puget Sound Business Journal reported.
VMFH was born in early 2021, after Seattle-based Virginia Mason announced it would merge with CHI Franciscan, whose parent company, CommonSpirit Health, is one of the largest Catholic health systems in the country.
At the time, the hospital system said that it would remain a non-Catholic organization, but that it would not provide direct elective abortions or physician-assisted deaths.
The ACLU of Washington and other reproductive-rights advocates had long opposed the merger plans, warning that it could jeopardize access to certain care, like abortion, contraceptives, end-of-life care and LGBTQ services.
