Penn Medicine is located at 3400 Spruce St.
Credit: Riley GuggenhimeThe University of Pennsylvania Health System eliminated 300 positions amid financial uncertainty on Tuesday.
The March 25 terminations were announced to employees in an internal email obtained by The Daily Pennsylvanian and represent a 0.5% reduction in UPHS's workforce. According to the email, the "restructuring and consolidation of certain roles" came as part of a plan to help "ensure strong financial footing."
"Like other health systems across the United States, Penn Medicine is working to ensure a strong financial footing while growing care for more patients across the region amidst continued changes and pressures for the field," a UPHS spokesperson wrote in a statement to the DP.
The spokesperson emphasized that the workforce reduction would "not result in discontinuation of any patient care services or programs."
According to the email, which was sent by UPHS Chief Operating Officer Michele Volpe, more than a third of the eliminated roles were either vacant or held by employees who had already announced plans to retire.
"This effort includes many exciting initiatives to care for even more patients in the communities we serve, from our hospitals to outpatient facilities to patients' own homes," the email read. "It also involves difficult decisions to focus our financial resources in new areas."
The email added that employees currently working in terminated roles would continue to receive salary and benefits consistent with UPHS policies, including full pay for at least four weeks following termination and career transition support.
In an interview with The Philadelphia Inquirer, Volpe said the Health System was operating in a "very, very difficult environment." She also noted that the cuts were not a response to recent federal funding pauses and reductions by the Trump administration.
The terminations come as Penn Medicine's average operating profit margin declined in the years following the COVID-19 pandemic. Earlier this month, Penn Medicine reported $117 million in operating profits for the first half of fiscal year 2024. The Health System expects the cuts to save approximately $40 million annually, The Philadelphia Inquirer reported.
An email from Penn President Larry Jameson sent earlier the same day said that faculty members across seven Penn schools received stop work orders amounting to approximately $175 million worth of research grants. Last month, Penn Medicine also announced that it was cutting graduate programs by 35% and pausing pilot grant programs amid federal funding uncertainty.
"Penn Medicine has been shaped by nearly three centuries of change and evolution, and this step is one among many parts of our strategy to ensure we can stay strong for generations to come. Thank you for your commitment and partnership," Volpe's email concluded.
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