Mass General Brigham announced mass layoffs aimed to bridge a $250 million budget gap projected over the next two years in a letter to employees Monday — meaning potentially hundreds of firings may be quickly coming down the line.
“Today, we begin a strategic reorganization across all parts of Mass General Brigham that will result in the elimination, consolidation or rescoping of a number of management and administrative positions — focused on non-clinical and non-patient facing roles,” MGB President and CEO Anne Klibanski wrote in an email to employees Monday morning. “We will complete this reorganization in March.”
Mass General Brigham (MGB) leadership declined to say how many positions may be laid off or a timeline of when employees may be notified Monday.
The MGB system, which includes Mass General Hospital and Brigham and Women’s Hospital along with 10 other specialty and community hospitals in the state, employs over 82,000 people and is one of the largest employers in Massachusetts, according to state data.
The budget gap of $250 million is around over 2% of the hospital system’s yearly employee compensation costs, according to MGB’s most recent publicly reported economic impact data.
The healthcare giant is “facing the same unrelenting pressures affecting many healthcare systems across the country that are contributing to a projected budget gap of a quarter of a billion dollars ($250m) within the next two years,” said MGB Senior VP of Communications Jennifer Street.
“We are acting now to allow us to continue with planned and future investments,” said Street. “As part of our response, we are consolidating certain management and administrative positions throughout the system.
The layoffs will focus on non-clinical and non-patient-facing staff “in an effort to enhance efficiency, reduce costs, and maximize support for frontline clinicians,” Street said. MGB leadership said the laid-off employees will receive “market competitive severance packages and benefits coverage.”
In the 2024 fiscal year ending in September, MGB reported an overall gain of $2 billion, nearly all from nonoperating activity like investments and interest rate swaps, according to data reported by MBG in December. Likewise in fiscal year 2023, the system also reported another sizable gain of $1.2 billion.
Despite the overall gain, the system reported a loss from operations of $72 million or a -0.4% operating margin in 2024, excluding $118 million in revenue from prior year activity, in the financial report. The December financial release highlighted a “an unrelenting capacity crisis … straining resources for health care organizations” throughout Massachusetts, adding the challenges “continue to curtail revenue growth.”
“This reorganization will improve efficiency, simplify decision-making and empower staff with more direct access to leadership,” Klibanski wrote in the letter to employees Monday. “Importantly, it will allow us to continue with planned and future investments in support of our patients and our mission, and to improve the lives of our clinicians and researchers.”
MGB will keep employees updated in the coming weeks, Klibanski said.