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Erin Hemme-Froslie, Published June 23 2008

MeritCare plans staff cuts and employee hour-reductions to trim costs

FARGO - Cass County's largest employer will reduce its work force by up to 100 employees later this week, and another 200 positions will see either a reduction in work hours or not be filled altogether, Dr. Roger Gilbertson, president and CEO of MeritCare Health System, wrote in an afternoon posting to the business’s internal Web site.

Both the internal posting and a news release that followed said the "reduction will affect aproximately 300" employees. They both go on to say "75-100 employees will lose their jobs, others will have their hours reduced, and some open positions will go unfilled." It is unclear whether the 200-225 employees not directly losing their jobs includes currently open positions.

Details of the workforce reduction have not been finalized, but should be known by Thursday, Gilbertson wrote. MeritCare will hold a Thursday press conference to answer questions, but is not answering further questions until then "out of respect for our employees," according to the news release.

MeritCare says the reduction in work force is needed to change its cost structure and work processes. The press release says MeritCare continues to see an 8 percent to 9 percent annual increase in patient volume. However, insurance and Medicare reimbursements for services are being cut or withheld, forcing a correction in expenses.

Back in early May, MeritCare officials said they didn't foresee the need to reduce their work force, but said Monday cuts to Medicare reimbursements could not be stayed, as they had hoped.

The press release said MeritCare plans to reduce the work force quickly and to "do it once."

"Any future reductions are likely to be much smaller and associated with downsizing or closing specific programs, or with the adoption of specific labor-saving technologies," the press release says.

Gilbertson wrote that MeritCare had hoped to inform employees before news got out but, in anticipation of The Forum breaking the story Monday afternoon or Tuesday morning, decided to inform all employees Monday.

Check back to www.inforum.com for further updates and read tomorrow’s Forum for complete details.