Optum to lay off more than 500 workers in California

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Brief description of the dive:

UnitedHealth’s health services segment, Optum, plans to lay off 524 employees in California, according to a worker adjustment and retraining notification filed with the state on July 18.
According to a letter from Optum to the California Department of Employment Development, the layoffs and “unit closures” will affect urgent care facilities, primary and specialty care clinics, and infusion centers in California, as well as office workers and more than 160 employees working remotely.
The cuts will be made in eight waves, starting this fall and starting in early 2025, the letter said.

Diving Insight:

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

“We are continually reviewing 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 impacted team members with hiring resources and will work to place them in any open positions across the company, to the extent possible.”

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

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

The health care conglomerate is also facing mounting costs following a cyberattack on its Change Healthcare subsidiary in February. The attack on the technology company and major medical claims processor is expected to cost the company between $2.3 billion and $2.45 billion this year, UnitedHealth said in its second-quarter earnings report earlier this month.

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

Optum reported revenue of $62.9 billion in the second quarter, compared to $56.3 billion in the same period last year. Operating income was $3.9 billion, an increase of 5% compared to the three months ended June 30, 2023.