MU Health Care is accelerating its financial recovery plan following a reported $56 million revenue shortfall. As part of this plan, spokesperson Eric Maze explained MU Health Care intends to reduce reliance on agency and contract labor by strengthening its employed workforce.
“Workforce shortages and inflation have increased labor and supply expenses exponentially,” Maze said in an email.
LiUNA Local 955 public employee representative Andrew Hutchinson said he hopes these reductions will create more full-time positions for the MU Health Care maintenance and service workers he represents. These positions support the institution’s patient-facing employees across MU Health Care’s system.
“We want long-term career jobs for our folks, not shoveling money out the door for contracted workers,” Hutchinson said. “You know, some of the biggest drivers of cost, in any workplace, is training and turnover."
However, Hutchinson said MU Health Care cutting contract laborers is a double-edged sword. He explained employees under the union, ranging from sterile processing technicians to construction workers, are already stretched thin.
“But what that means is that MU needs to increase wages to attract more workers to it so that we can have more long term, stable career jobs.” Hutchinson said. “Just reducing agency labor without increasing wages or adding more vacant positions is not a solution.”
LiUNA Local 955 will enter wage negotiations with MU Health Care later this summer, as the financial recovery plan is rolled out by the administration. Maze said parts of the plan could take up to a year to implement.
In addition to restructuring the labor force, Maze said MU Health Care will cut supply expenses with clinical oversight to address the budget shortfall.
But Christopher Garmon, an associate professor of health administration at the University of Missouri-Kansas City, said hospitals’ supplies, salaries and wages have only risen slightly above inflation in the past year.
“What we all pay for hospital care — physicians, pharmaceuticals, those costs — those prices have been going up,” Garmon said. “If you look over the past 25 years or so, they have been going up faster than inflation and wages, generally.”
Maze also cited MU Health Care's out-of-network period with Anthem Blue Cross Blue Shield as a financial pressure on the institution.
When federal cuts to Medicaid are rolled out in 2027, more than 200,000 people in Missouri will lose their insurance by 2034, according to the U.S. Congress Joint Economic Committee. For those Missourians, health care will become more expensive, and hospitals will see fewer reimbursements for care.
“And that will likely show up as reduced Medicaid revenue for hospitals throughout Missouri, including MU Health,” Garmon said.
