Layoffs Thanks to EHR Implementations

Becker’s is reporting that Lahey Health is laying off 130 people in large part due to their expensive Epic EHR implementation. Here’s an excerpt from the article:

On Wednesday, Burlington, Mass.-based Lahey Health announced it is laying off 130 people at three hospitals to help close the budget gap.

In the six months ended March 31, Lahey Health reported losing $21 million, partly due to lost business during the winter’s fierce snowstorms and partly due to its EHR implementation, which cost the system more than it expected, according to a Boston Globe report.

Even better is the CEO of Lahey Hospital and Medical Center made this comment about the EHR implementation costs:

“What we’ve found in the last quarter, which is our triple whammy, is we have a lot of training costs, which are necessary before you go live,” Dr. Conroy said.

First, that probably means that it cost a lot more than $160 million for the Epic EHR implementation since they were unexpected training costs. Second, I wonder how many people were hired as part of the $160 million budget. It certainly makes for an interesting story that they’d hire tons of EHR and healthcare IT talent and lay off other people at their hospital.

Stories like this explain at least part of the reason why many clinical staff are turning to IT jobs. It also reminds me of the doctor who complained about an EHR training with the comment “Do you want your well paid doctors wasting time with this?” The EHR project manager said, “Our well paid doctors are a lot cheaper than are high priced EHR consultants.”

About the author

John Lynn

John Lynn

John Lynn is the Founder of the HealthcareScene.com, a network of leading Healthcare IT resources. The flagship blog, Healthcare IT Today, contains over 13,000 articles with over half of the articles written by John. These EMR and Healthcare IT related articles have been viewed over 20 million times.

John manages Healthcare IT Central, the leading career Health IT job board. He also organizes the first of its kind conference and community focused on healthcare marketing, Healthcare and IT Marketing Conference, and a healthcare IT conference, EXPO.health, focused on practical healthcare IT innovation. John is an advisor to multiple healthcare IT companies. John is highly involved in social media, and in addition to his blogs can be found on Twitter: @techguy.

3 Comments

  • John, interesting that you pointed out last minute training needs as a big budget impact. That’s exactly what happened to my organization. There you are at the end of the implementation. The money is about gone, and the users say they are really nervous and would like at the elbow support at go-live. What happens next is they bring in these contractor firms that bring in mobs of folks to help at go-live. It turns out there’s no way these groups can come up with that many Epic certified (or credentialed) trainers. Some basically take people off the street with no healthcare background, then give them a crash course and send them to the hospital.
    As for the overall budget hit, I saw that after some belt tightening, we were right back to the black after a year or so. Seems like that’s what other organizations are also seeing.

  • Dave,
    I’ve seen and heard what you describe many times over. It’s a major challenge and a big budget hit that has to be made up somewhere.

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