Business & Tech

North Shore Medical Center to cut 200 jobs

Lynn, MA 072414 Shown hospital facade. Partners HealthCare wants to close the acute-care hospital in Lynn, Union Hospital (part of North Shore Medical Center), but a group of citizens is protesting the change. They argue that Lynn, a diverse city of more than 90,000, needs its own hospital and that residents should not have to go to neighboring Salem for their care. Activist met the photographer for a portrait on July 24, 2014. (Essdras M Suarez/ Globe Staff)/ MET ACTIVIST WERE THERE ONLY TO MEET PHOTOGRAPHER. THEY WERE NOT REALLY PASSING SIGNS OR STICKERS. THIS WAS SOMETHING FOR THE GLOBE.
Globe File Photo/2014
North Shore Medical Center’s campus in Lynn.

Partners HealthCare is planning to cut 200 jobs at its North Shore Medical Center, the latest step to address growing financial losses.

Hospital officials said up to 5 percent of the workforce would be eliminated, including positions that are already vacant. North Shore Medical Center employs about 4,000 people between its two campuses in Salem and Lynn.

The job reductions, beginning this month, will affect people in administrative positions, as well as those who care for patients. They follow decisions by hospital officials to cut two clinical programs and scale back a major expansion project.

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North Shore Medical Center has struggled for years. It lost $48 million on operations in the fiscal year that ended Sept. 30, after losing $36 million the previous year, officials said.

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“The time to act was now,” said Dr. Gregg S. Meyer, chief clinical officer at Boston-based Partners and interim president of North Shore Medical Center. “We think doing a large, significant action now, rather than a phased or trickled-out approach, is important. We need to right the ship.”

Meyer said the hospital is struggling with a high percentage of patients on Medicaid, the government program for low-income individuals. Medicaid pays lower rates for medical services than private insurers do. North Shore also provides mental health services, which typically are not money makers for hospitals.

The layoffs, which were reported earlier by the Salem News, are part of a plan to cut hospital expenses by $45 million over the next two years, Meyer said. That plan will be overseen by Dr. David J. Roberts, who is scheduled to take over as president of the hospital in April.

An executive at the Service Employees International Union, Local 1199, which represents about 700 workers at North Shore, said the union is monitoring the layoffs. “We will continue to engage in conversations with North Shore Medical Center management to promote alternatives to layoffs, save jobs where possible and protect quality care,” Filaine Deronnette, vice president of health systems at 1199SEIU, said in a statement.

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North Shore is planning a more than $200 million project to close its campus in Lynn and consolidate and expand services in Salem. Executives decided in November to scale back that project to add 30 fewer psychiatric beds and 16 fewer medical/surgical beds, citing uncertainty about future demand for services. The revised plan still needs approval from state health officials.

Last year, hospital officials decided to stop doing heart surgeries in Salem, citing low demand. Last week, they said they would also discontinue inpatient pediatric services.

Priyanka Dayal McCluskey can be reached at priyanka.mccluskey@globe.com. Follow her on Twitter @priyanka_dayal.