As large health systems with high overhead grapple with the need to reduce costs in the face of likely cuts in Medicare and Medicaid reimbursement, the whole concept of one of our current hot button topics, emergency preparedness, takes on new meaning.  

That creating larger health systems to improve their  market negotiating power drives up costs is no surprise to anyone who has been in the industry for any length of time.  Bigger does not translate into lower costs when it comes to healthcare providers.

Reductions In Force, Spending

Two weeks ago, Common Spirit, the new company that includes Dignity Healthcare and Catholic Health Initiatives, announced that they plan to strip out $2 billion in costs over the next four years. Their first month’s financial results were troubling, with higher costs and lower revenue. 

Now Providence St. Joseph Health System in Renton, WA announced that they, too, will be reducing administrative overhead costs.   

There are other  organizations who are quietly taking action and other cost reduction announcements are expected through the remainder of 2019 and could well accelerate if the economy begins to slow.

In plain English this means there will be layoffs, or as consultants like say, a reduction in an organization’s labor intensity. 

Providence St. Joseph to cut 700 Positions

The estimated number of job casualties at Common Spirit has not yet been released.  In Providence St. Joseph’s case, up to 700 full-time positions are involved.  The executives who are included in these reductions in force will enter an already crowded, competitive job market. 

Emergency preparedness is an important hot-button subject for healthcare providers these days and many organizations are investing in this important initiative with a growing number of cyber attacks, cyber extortions, and catastrophic weather events. 

Executives who workin the healthcare services segment should understand that it also applies to their careers.

Good Performance No Longer a Guarantee

Being go-to-market ready should be an important topic for healthcare executives who may be pushed out of their jobs because good performance is longer the job guarantee it once was in the healthcare industry.

If you are unsure how you will fare in the job market in the event of an unexpected career disruption, the first step is to secure a career transition readiness assessment so you can react before you are surprised.

If you would like more information on emergency preparedness for your career, you can find us at,  on LinkedIn or our corporate Facebook page.