Miami-based Nicklaus Children’s Hospital is making cutbacks in response to industry pressures, including dwindling reimbursement, according to the Miami Herald.
Nicklaus Children’s executives outlined the cutbacks in a memo to staff obtained by the Miami Herald. The hospital will eliminate pay raises for all employees this year, limit the number of new hires and reduce pension contributions, according to the report.
These cutbacks could create significant savings for Nicklaus Children’s, which has roughly 3,500 workers. Labor costs make up 57 percent of the hospital’s operating expenses, according to the report.
The letter to staff also said it is necessary for Nicklaus Children’s to reduce the size of its workforce to lower operating expenses.
In a written statement to the Miami Herald, a hospital spokesperson said the cutbacks and layoffs will help preserve the hospital’s financial position in the face of several industrywide challenges, including “reductions in reimbursement … a shift from inpatient services to outpatient care, and financial pressures due to rising costs and increased competition.”
Access the full Miami Herald article here.