UCSF Medical Center Cuts Costs by $45 Million to Avoid Furloughs, Maintain Care

To meet its budget target, while maintaining the highest quality of patient care, the UCSF Medical Center is taking a number of actions to reduce expenses by more than $45 million, which means that it will not need to implement furloughs or reduce staff salaries. 

The salaries of senior medical center management will be reduced.

CEO Mark Laret, in a message to medical center employees and other campus members, said the savings that have been achieved are equivalent to the amount that furloughs would have yielded. 

When the UC Regents approved the systemwide furlough plan on July 16, they agreed to provide UC medical centers flexibility in meeting their budget reduction targets. The UCSF Medical Center’s cost-cutting plan was approved by UC President Mark Yudof.

Over the last year, the medical center has eliminated 130 staff and imposed a hiring freeze for non-clinical staff. The nursing staff has not been cut.

Meanwhile, UCSF campus officials are working with the UC Office of the President on how to implement the furlough plan for other employees at UCSF. A Q & A is posted on the UC Budget website.

Here is the full text of Laret’s letter:

Dear Colleagues,

As you know, when the UC Regents approved a plan for university-wide furloughs and salary reductions on July 15, the Regents allowed UC President Mark Yudof to consider alternate plans from the medical centers to achieve the same level of savings. I’m pleased to report that President Yudof has approved this alternate plan.

Under our plan, medical center employees and non-physician, clinically related employees at the School of Medicine and School of Dentistry will not be furloughed or have their pay decreased. Instead, we will achieve savings through the following measures, many of which have already been implemented:

  • Review and elimination of vacant positions
  • Planned attrition, layoffs, reductions in time and program closures
  • Voluntary Separation Program
  • Reduction in the use of contract and temporary labor
  • Salary reductions for senior management

Through these measures, we will achieve savings in excess of $45 million, equivalent to the amount a furlough would have achieved. These savings will allow us to meet our budget target for the fiscal year while maintaining our highest standards of patient safety and quality.

These are trying times for the state and the University of California. Severe budget cuts have created serious challenges for President Yudof and campus leaders.  With the flexibility President Yudof has given the medical centers to achieve our share of savings in an alternate way, we must refocus ourselves on our important work—caring for our patients, providing the highest quality, safest care; improving inpatient and outpatient satisfaction with our services, and doing all of this more efficiently than ever before. 

Thank you for your support of UCSF Medical Center and our patients.


Mark R. Laret
Chief Executive Officer
UCSF Medical Center
UCSF Children’s Hospital
[email protected]