May 11, 2023 - Business

Ochsner to lay off 770 employees in Louisiana and Mississippi

Photo shows an exterior view of Ochsner Medical Center in Jefferson Parish. Blooming magnolia trees are in the foreground.

Ochsner Medical Center in Jefferson Parish is the health care system's main campus in metro New Orleans. Photo: Daymon Gardner/Ochsner Health

Ochsner Health is laying off 770 employees in Louisiana and Mississippi, a company spokesperson confirms to Axios. | The Times-Picayune broke the news Thursday morning.

Why it matters: Ochsner is the largest health system in Louisiana and the state's largest private employer, per info from the company.

  • The layoffs represent about 2% of the organization's workforce, according to an email sent to employees Thursday.

Driving the news: Ochsner CEO Pete November in his email said the cuts are due to increased labor costs, high inflation and the end of federal pandemic relief funding, among other reasons.

  • The cuts are expected to save Ochsner between $125 million and $150 million annually.
  • Ochsner lost about $96 million last year, reported, marking its first unprofitable year in more than a decade.

What’s happening: No physicians will be laid off, November wrote.

  • The cuts are mainly in management and "non-direct patient care roles."
  • Employees who are being laid off received a calendar invite for a meeting Thursday.
  • They will get full pay and benefits for up to 65 days depending on their work schedule in addition to severance packages.

Of note: Ochsner told it will not close or consolidate its 42 hospitals or 200+ health facilities in Louisiana and Mississippi.

  • The hospital system does not plan additional "systemwide" reductions, an Ochsner spokeswoman tells us.

Flashback: The health care system started when Alton Ochsner and four colleagues opened New Orleans’ first multi-specialty group in 1942. In 2021, Ochsner Health, a nonprofit organization, treated more than 1 million people.

Big picture: The cuts come during a period of change in New Orleans’ health care landscape, primarily driven by LCMC Health, Ochsner’s closest rival.

Editor’s note: This story has been updated with additional information from Ochsner.


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