UVM Medical Center, Burlington, Vermont. Courtesy photo.
Staff Reductions, Further Unification of Health System, Part of Targeted Ongoing Affordability Work
Vermont Business Magazine As part of the ongoing regional effort to make health care more affordable for patients and communities, University of Vermont Health Network today announced new steps to reduce expenses. The plan includes reducing the administrative and non-direct patient care workforce, operating more efficiently in areas like budgeting and staffing, and improving care coordination. Additionally, after discussion with the senior leadership team, UVM Health Network’s Board of Trustees has also approved a pause on performance-based variable pay for all leaders this fiscal year ending in September. This is part of their effort to reduce expenses by over $185 million.
Administrative staffing cuts
To continue reducing expenses, the health system has made the difficult decision to eliminate a number of positions that are almost entirely administrative and non-direct patient care roles supporting health care partners across UVM Health Network. Examples of these types of roles include areas like finance, human resources, project management and continuing education support.
As part of the latest actions, a total of 146 largely administrative and non-direct patient care positions have been eliminated across the health system. Of those, 77 were filled roles (68 staff level and 9 leader level), resulting in layoffs. This builds on earlier actions the health system took throughout the year to gradually cut several hundred of primarily non-direct patient care roles, either vacant or in active recruitment. UVMHN employs 4,000 health care professionals across its system, which is led by the UVM Medical Center in Burlington.
Positions were identified through a thoughtful and inclusive process, with input from each health care partner, as well as clinical, operational and administrative leaders, and guided by a commitment to reduce expenses while limiting as much as possible the impact on direct patient care. The health system is offering transition support, including opportunities to pursue other available roles, for employees impacted by the latest actions.
Expense Reduction Actions
- Capital planning – Reductions in capital budget for FY26, prioritizing projects with greatest need and long-term impact: $70M
- Efficiencies in clinical care – Revising clinical programs to increase access and quality while reducing cost through strategic medical device choices, reducing unnecessary testing, minimizing inpatient & ED stays, keeping care local: Up to $60M
- Workforce management – Reducing travelers and locums, shared temporary worker hiring pool reducing duplication, replacing with permanent staff: $30M
- Administrative cost reductions – New staffing cuts detailed on previous slide: Over $5 million
- Additional administrative efficiencies – About $10M
- Eliminating leader variable pay for FY25 - $7-10M
- Real estate optimization – Consolidating physical spaces: about $400,000 per year
“Today is a difficult day for our organization. We need to take these steps now because health care is changing, but these decisions have a personal impact on the employees who were affected and their families who are looking at what comes next,” said Sunny Eappen, MD, MBA, president and chief executive officer of UVM Health Network. “I’m sorry for the disruption and uncertainty these actions create for our colleagues who are impacted. I want to thank them for their dedication to our patients and for their work in supporting our health system.”
Sunny Eappen, MD, MBA, president and CEO of UVM Health Network. VermontBiz file photo.
Dr. Eappen added: “The people of this organization have served Vermont and northern New York for more than 100 years, and it’s our responsibility to ensure access to affordable, high-quality care in our region, now and into the future. That’s why everything we do must be in service to our patients and communities – even when we’re making incredibly difficult decisions. Whether I’m rounding in our hospitals and clinics, or talking with neighbors at the grocery store, I hear clearly that health care is too expensive. To address affordability head on, UVM Health Network is examining our role and taking action to reduce our costs to deliver care. So far, we’ve done so by increasing efficiency, cutting purchasing costs, delaying investing in infrastructure, and other important steps. But the truth is, to meet this moment, we must make one of the most difficult decisions of all: We have to reduce our staffing. Today, we’re announcing a reduction largely in our administrative workforce. This is difficult news to share and in no way a reflection of the work of our colleagues, but a reality of the changing landscape of health care. I want to honor the contributions of these people, who are our friends, neighbors and family – they have done important work to support the care we provide.”
While the organization is making necessary reductions in certain areas, UVM Health Network will continue to make strategic investments in other critical areas that support our ability to provide timely access to high-quality, equitable and efficient care, and will work with impacted employees to find suitable open roles in those areas where possible.
Improving efficiency as a unified health system is a primary focus
As a system made up of individual organizations that joined together organically over the past decade and a half, UVM Health Network has additional efficiencies and savings to realize by becoming a unified, high-performing system with benefits that are easy to see and feel for patients. The health system is accelerating more of this multi-year work, including: Working as one to reduce purchasing costs, further cut already reduced spending on temporary workers like nurse travelers and efficiently match staffing to real-time need throughout the region. Additionally, vendor contracts and real estate will be re-evaluated to find savings. Operations will be more effective with streamlined approvals, documentation and more.
“Health care is changing and doing things the way we always have is not sustainable, which means we must take meaningful action to make care more affordable, more accessible and at the highest quality,” Eappen added. “Today’s actions are an important step toward our affordability goals, but we have more work to do. To get there, we’re taking a hard look now and in the future at the costs we can control and focus on being more efficient to reduce the cost burden on patients, while continuing to support our dedicated workforce.
As part of the system’s efforts toward greater efficiency, leaders are working to identify how to maintain and strengthen patient experience with less administrative costs.
Next Steps and State, National Concerns
Vermont and northern New York face serious impacts from the recently passed and signed “One Big Beautiful Bill,” which includes nearly $1 trillion in cuts to Medicaid, and which will lead to an estimated 45,000 Vermonters and 1.5 million New Yorkers losing their health care coverage over the next 10 years.
While it will take some time to analyze and fully understand the impact of the law on the region’s patients, families and communities, it will negatively impact people’s health and put pressure on an already struggling health care delivery system nationwide. UVM Health Network will continue to assess the impact of these changes, but today’s actions are still at the beginning of the system’s efforts to reduce costs. The organization will need to take further actions to be more effective and efficient in the future. The health system is actively working with a team made up of representatives from the organization, the Green Mountain Care Board and an independent liaison to identify additional areas for improvement and value.
In this work, the health system is committed to being transparent, staying focused on putting patients and their health first, and continuing to make choices that help the organization effectively and efficiently support them for years to come.
AFT Vermont Union Leaders Respond to UVMHN Layoffs
“While UVMHN is trying to push a narrative that they are cutting from the top, the reality is these layoffs will do little to bring down the bloated administrative costs that plague their budget,” said Nicole DiVita, President for Healthcare at AFT Vermont. “The Network has indicated that eliminating leader variable pay for FY25, through September, will save $7-10 million. Meanwhile, these 146 eliminated positions will save them only $5 million. Though mostly non-clinical, these eliminated roles are crucial to Hospital and Clinic operations and will have a direct negative impact on patient experience. It seems to me that UVM Health Network leadership would rather patients and workers suffer than look at the real root of the problem.”
“We should also remember that all of this is happening because the network is making too much profit, NOT because their expenses are too high,” said Melissa Lavallee, Vice President for Healthcare at AFT Vermont. “With $1.1 billion cash on hand and some of the highest prices in the nation, it is untenable that UVMHN thinks their budget issues are best addressed by laying off employees essential to successful hospital operations.”
“Of the 77 layoffs, only 6 are unionized employees,” said DiVita. “These layoffs are certainly a disturbing development. However, we are proud that the strong contracts our members have won protected the vast majority of union employees from losing their jobs during these unstable times.”
About University of Vermont Health Network
University of Vermont Health Network is an integrated system serving the residents of Vermont and northern New York with a shared mission: working together, we improve people’s lives.
The partners are:
- University of Vermont Medical Center
- University of Vermont Health Network Medical Group
- University of Vermont Health Network – Alice Hyde Medical Center
- University of Vermont Health Network – Central Vermont Medical Center
- University of Vermont Health Network – Champlain Valley Physicians Hospital
- University of Vermont Health Network – Elizabethtown Community Hospital
- University of Vermont Health Network – Porter Medical Center
- University of Vermont Health Network – Home Health & Hospice
Source: 7.29.2025. Burlington, Vt. –UVMHN. https://www.uvmhealth.org/
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