Jul 2, 2008 3:50 pm US/Pacific
Oakland Children's Hospital Lays Off 84 Employees
OAKLAND (CBS 5 / AP / BCN) ―
A slumping economy and the state's budget crunch is being blamed for the abrupt layoff of dozens of employees at Children's Hospital Oakland.
In a move that caught the medical staff by surprise, 84 employees were let go Tuesday.
Those laid off included doctors, nurses and clinical workers. Some were reportedly escorted out of the facility by security — a claim denied by hospital officials Wednesday.
"There were no known escorts performed due to terminations," said director of security Don Mitchell, who reviewed escort logs.
"It's unfortunate that these sort of rumors get spread," Mary Dean, the hospital's senior vice president and chief strategic development officer, added. "All the affected people acted with the dignity and professionalism that we anticipated."
The 84 employees now without a job make up less than 3 percent of the 2,600 employees at the facility.
The layoffs came on the same day that that the state began imposing a 10 percent cut in Medi-Cal reimbursement rates, which officials said is now well below the cost of providing the care.
In a letter sent out to employees, hospital president and CEO Frank Tiedemann said approximately 67 percent of the hospital's patients are covered by Medi-Cal.
"We are being hit hard by the slumping economy and the state budget crunch," said Tiedemann. "It's a challenging time for pediatric health care providers. But challenges lead to opportunities, making this an appropriate time for us to realign programs and services that will make us more effective and financially stable."
The layoffs, were approved by the hospital's board of directors last week, were expected to save Children's Hospital $10 million a year.
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