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WellSpace Health, the Sacramento region’s largest low-income community health care provider, is laying off 135 employees and closing several of its services amid ongoing funding issues.
In a letter sent to employees informing them of the restructuring on Friday, WellSpace CEO Jonathan Porteus called it “a sad day for the organization.”
“This was not an easy or quick decision, but it was one I have made for the good of our patients and the future of our mission," the letter stated.
WellSpace provides a variety of medical, dental and behavioral health services to low-income patients in Sacramento, Placer and Amador counties, largely funded through Medi-Cal, Medicare and other public programs and service contracts.
“In recent years, reimbursement has not kept pace with inflation and, in many cases, reimbursements have been delayed or not received at all,” the letter said. “Therefore, it is critical that we align our services with the funding that sustains them."
Layoff notices have gone out to 14% of the organization’s workforce. In addition, WellSpace will be closing three of its health centers — in Amador, Folsom and South Sacramento — and canceling several of its service provider contracts. The layoffs, facility closures and program changes are expected to be completed by June 30.
It’s also implementing cost-saving measures including cuts to the executive team’s pay and limiting new hiring and business travel.
WellSpace’s federally qualified health centers, certified community behavioral health centers, operations of the 988 suicide and crisis hotline, and behavioral health programs will continue. Its plans to expand to build the Community Wellness Campus on Stockton Boulevard and Placer Community Health Center will also continue.
“Through these measures, we are protecting and stabilizing our organizational finances so we have the capacity to carry our mission forward on solid financial ground,” Porteus wrote.