Providence layoffs reach 172

Providence Health Care has accepted 172 voluntary layoffs as part of its move to cut $61 million from its operating budget next year.

Most of the employees worked at Sacred Heart Medical Center and Holy Family Hospital, said Providence spokesman Joe Robb.

Employees who participated in the separation offer were given severance pay and cash bonuses. They had to leave their jobs by Dec. 16.

Providence received 335 applications for voluntary layoff. The hospital system has a total of 8,500 workers.

Most hospitals are treating fewer patients this year, and the trend is expected to continue in 2012 as the economic malaise continues. Hospital executives nationwide have noted that people are less apt to pay for elective surgeries – even including procedures such as knee replacements – amid the uncertainty.

Providence intends to run its network on a $1.1 billion budget next year, executives say.

Elaine Couture, chief executive of Sacred Heart, said hospital managers continue to search for savings across the system. Salaries and benefits account for about half of the Providence budget.

While Providence accepts voluntary layoffs for some positions and lets other positions go dark as people leave, it continues to hire for other jobs.

The moves all are part of an ongoing effort by Providence to change its hospital-centric model of health care by expanding its network of clinics and physicians. Hospitalization is the most expensive component of health care, so any cuts in spending require that hospital operators find more-efficient ways of delivering care without affecting quality.