Updated at 5:45 p.m. with comments from the chief health care officer of the Association of American Medical Colleges
Washington University’s health care system is planning large-scale furloughs to deal with financial losses, even as parts of it scramble to handle a rush of COVID-19 patients.
Furloughed employees will be off work without pay but will still receive university benefits such as health insurance.
Furloughs could affect up to 1,300 university employees and last up to 90 days, Chancellor Andrew Martin said Monday.
That represents about 8% of the university’s total workforce of 15,500.
There will be a “significant number of furloughs” at the medical campus in the Central West End over the summer, Martin said.
The university’s hospitals, which include Barnes-Jewish Hospital in St. Louis, canceled elective procedures and moved many visits to virtual platforms in March to focus on treating people with the coronavirus. There are hundreds of empty beds at the institution’s teaching hospitals, Martin wrote in an email to faculty and staff on Monday.
Clinics run by Wash U physicians are seeing 60% fewer patients, and operating revenue for the medical campus is down $60 million in just the past month. The medical school is projecting a total revenue loss of $150 million by the end of this fiscal year.
The main campus will lose $25 million, in part from refunding unused room-and-board payments to students after it shut down in March.
Wash U is under an indefinite hiring freeze, and there will be no merit raises, Martin said, adding that he and other senior leaders will take a 15-20% pay cut.
To date, the university's medical campus has been allocated $16 million from the federal CARES Act rescue package. The school has been alloted another $6.4 million that would primarily benefit its main campus.
The federal money is just a small portion of what the university will have to recoup, said Dr. Janis Orlowski, chief health care officer at the Association of American Medical Colleges.
A survey of the organization’s teaching hospitals, which include those at Wash U’s med school, found that on average they were losing between $2 million and $8 million a day during the pandemic, she said.
“It is kind of ironic — these physicians are the front line to try and treat the pandemic, but we’re really seeing significant losses in their clinical income,” she said. “That’s reflecting back on their medical school practice.”
Additionally, medical schools have had increased costs to deal with COVID-19, including setting up testing sites and buying protective equipment, she said.
All in-person classes and activities at Wash U have been suspended through at least Aug. 1. Officials say that normal operations could resume again during the fall semester, but that the school “stands ready to make adjustments as necessary.”
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