Optum To Lay Off More Than 500 Workers In California

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Dive Brief:

• UnitedHealth’s health services segment Optum will lay off 524 employees in California, according to a Worker Adjustment and Retraining Notification filed in the state on July 18.
• The layoffs and “departmental closures” will affect urgent care locations, primary and specialty care clinics, and infusion centers in California, as well as office workers and more than 160 employees who work remotely, according to a letter from Optum to California’s Employment Development Department. 
• The cuts will take place in eight waves in the fall this year and in early 2025, the letter said. 

Dive Insight:

None of the workers affected by the layoffs are represented by a union. The cuts include nurses, physicians, radiology technicians, physicians assistants, patient care coordinators, pharmacists, social workers, health coaches and other employees, according to documents from the state. The layoffs will affect 17 Optum workplaces, including departmental closures at 15 locations, largely in Southern California. 

“We continually review the capabilities and services we offer to meet the growing and evolving needs of our businesses and the people we serve,” a UnitedHealth spokesperson told Healthcare Dive. “As always, we will support affected team members with job placement resources and seek to deploy them where possible to any open roles within the company.”

The spokesperson added that UnitedHealth has more than 10,000 job openings across the country, and the company employs more than 20,000 people in California. 

The layoffs come months after Optum said it would close a facility in Ohio this summer, laying off 129 workers. Optum laid off more than 100 workers in its naviHealth division in April, according to reporting by Modern Healthcare. 

The healthcare conglomerate is also facing growing costs from a cyberattack against subsidiary Change Healthcare in February. The attack against the technology firm and major medical claims processor is expected to cost the company between $2.3 billion and $2.45 billion this year, UnitedHealth said in a second-quarter earnings report earlier this month.

The company had previously said costs arising from the cyberattack could reach $1.6 billion this year. 

Optum reported revenue of $62.9 billion during the second quarter, up from $56.3 billion in the same period last year. Operating earnings were $3.9 billion, increasing 5% from the three months ended June 30 in 2023.