Tufts Medicine laying off 174 employees to 'stabilize financial health'

Citing tough financial headwinds, Burlington, Massachusetts-based Tufts Medicine confirmed plans to lay off another 174 of its employees.

The nonprofit system, among the largest in the Bay State, employs about 13,000 people across its four hospitals and other sites. The organization said in a statement that the “vast majority” of those included in the workforce reduction have administrative and non-direct patient care roles.

“While we continue to make steady progress towards our goal of financial recovery, like many other health systems, we continue to face challenges from persistent capacity issues, high contract labor expenses and rising supply chain costs,” Tufts Medicine wrote in an emailed statement. “As a result, we are taking steps to reduce the size of our workforce … to help stabilize our financial health and best position Tufts Medicine to continue providing high-quality care to the patients and communities we proudly serve.”

In a Tuesday message to employees, CEO and President Michael Dandorph reportedly told staff there are other efforts underway to address the system’s operating challenges. He also stressed the cuts would not harm the system’s care or the safety of its patients.

“Rather, it will enable us to invest further in the programs and services our patients need,” Dandorph wrote.

Tufts Medicine logged a $171 million operating loss and 71 days of cash on hand at the close of its most recent fiscal year, which ended Sept. 30, 2023. This was an improvement over the prior year, when it recorded a $399 million operating loss.

Tufts Medicine, which has ties to Tufts University and its School of Medicine, had undergone a round of reductions early last year that led to 70 “primarily administrative” staff being laid off and another 170 unfilled positions being eliminated.

A decision to sell off its outreach laboratory business to Labcorp later in the year had repercussions for 574 of its positions, though the system said at the time that most would find new roles with Labcorp.

In February Fitch Ratings downgraded Tufts Medicine from “BBB” to “BBB-,“ which the agency said “reflects the slower than expected improvement to [Tufts Medicine's] operating performance, including another year of significant operating losses, coupled with a year over year decline in unrestricted cash and investments.” Fitch noted that it has reviewed the system’s turnaround plan and “believes the plan’s goals are reasonable” and achievable.