The MetroHealth System announced Aug. 5 that it will begin cutting costs in response to disappointing financial numbers this year, but layoffs aren't being considered.
Dr. Christine Alexander-Rager, MetroHealth's acting president and CEO, sent a memo to staff noting that the system's 2024 financial performance is "not where we expected it or need it to be."
She argued any financial shortfalls were due to national trends affecting other hospital systems, including, "rising costs, talent shortages and demographic changes."
Rager sought to assure staff that, despite the financial news and pending cost-cutting, there was no need for concern and the hospital system remained in financial good health.
"Let me be clear: These are course corrections, not major changes in direction," she wrote. "We just need to tighten our belts while we grow revenues and increase access by working smarter. As I told our leaders, we are acting with a sense of urgency — not panic. MetroHealth remains financially strong, especially compared to other safety-net hospitals. We are outperforming 2023 across multiple fronts."
MetroHealth is currently $27.2 million behind the hospital system's financial projections for 2024 with $35.8 million in revenue as of June 30 versus Metro's $63 million revenue projection for the first half of the year.
While the hospital system is considering a number of measures, layoffs or offshoring jobs are not among the options, said Dorsena Koonce, a spokesperson for MetroHealth.
Instead, according to the memo, MetroHealth will immediately:
- Significantly reduce all travel expenditures — including by senior executives,
- Pause administrative searches except those that are in the final stages,
- Prioritize hiring for patient-facing roles in areas with the strongest opportunities for growth and expanded access,
- Expedite MetroWay Forward initiatives to improve access, streamline operations, enhance revenue, increase pharmacy capture rate and enable caregivers to do their best work every day, and
- Reduce unnecessary expenses, including purchased and contracted services.
Rager also asked staff for cost-cutting suggestions, adding, "We need everyone’s best thinking if we are to meet our goals."
The hospital's executive team is currently evaluating existing contracts to determine where cuts should take place, Koonce said. Efforts include implementing the MetroWay Forward initiative to enhance hospital performance, which includes improving access to care while growing revenue, she said, noting that there is no timeline to implement changes.
