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Economic challenges force California provider to cut 7% of workforce

by John R. Fischer, Senior Reporter | July 20, 2022
Business Affairs
NorthBay Health will cut nearly 190 full-time-equivalent employees.
The financial burden of the global pandemic has driven a reputable California independent nonprofit healthcare system to cut 7% of its workforce to balance its budget.

NorthBay Health in Solano County announced on July 11 that close to 190 full-time-equivalent positions would be discontinued within its workforce of 2,700, with more potential cuts looming. Under the provider, a full-time-equivalent position refers to a single person working full time or multiple individuals whose part-time hours combined make up one full-time job, according to the Daily Republic.

The healthcare system operates NorthBay Medical Center in Fairfield and NorthBay VacaValley Hospital in Vacaville, along with specialized and primary care clinics. Nearly all departments will be affected, including administration, which will see a 20% reduction in senior management jobs.

“Our belt-tightening will not affect the high-quality patient care we deliver and that our community depends on,” B. Konard Jones, president and CEO of NorthBay Health, said in a statement.

The financial challenges experienced at NorthBay were chalked up to reduced volumes; skyrocketing prices for supplies, drugs and medical devices; expensive costs for temporary workers; and the rising number of Medicare and Medi-Cal patients not fully covered.

The company tried to reduce positions and net cost savings as a percentage of total operating costs through retirements and voluntary departures alone, including senior management roles. But Jones says that additional staffing cuts are needed to “ensure financial sustainability."

He adds that the healthcare system has a “strong, multifaceted recovery plan that will help us balance costs with revenue opportunities,” but did not divulge details on it.

The need to balance income with spending may lead to other cuts.

NorthBay Health is providing severance packages to those let go and will support them in their job searches.

Despite the cuts, the practice opened in July 2022 a new 4,500-square-foot urgent care facility in American Canyon. The medical center has 10 exam rooms, as well as X-ray and laboratory facilities.

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