Duluth-based medical system laying off about 900 employees due to pandemic-related losses

Essentia Health Photo: Courtesy of Facebook. Essentia Health

Kyle Brown
Updated: May 21, 2020 08:53 PM
Created: May 21, 2020 08:50 PM

A Duluth-based health care system is laying off roughly 900 workers, citing a decline in patient volume since the beginning of March.

Essentia Health, which employs about 14,500 people, said the permanent layoffs would reduce its staff by 6%. Another 850 employees are on administrative leave with benefits through the end of July. The company said those employees could be called back as needed.


Before announcing the layoffs on Thursday, Essentia said it had furloughed workers, flexed hours, cut pay for physicians and executives, among other cost-saving efforts.

“Despite our best efforts, the many cost-reduction measures we’ve taken over the last several weeks are not sufficient to preserve our mission and the health of the organization,” says Essentia Health CEO David Herman. “This has prompted our leadership team to carefully consider the most difficult decision we’ve faced since I joined Essentia five years ago and move forward with permanent layoffs.”

In a news release, Essentia said its operational losses since March total nearly $100 million while its hospitals and clinics put many operations on hold to direct its resources toward fighting the coronavirus pandemic.

Although its facilities are able to resume elective surgeries and procedures, the company said it is taking a slow approach to preserve personal protective equipment supplies for front-line doctors and nurses and keep hospital beds for an expected increase in COVID-19 patients.

Essentia operates 13 hospitals, 69 clinics and 12 congregate care facilities in Minnesota, Wisconsin and North Dakota.

Copyright 2020 - KSTP-TV, LLC A Hubbard Broadcasting Company

Comment on Facebook

LIVE COVERAGE: KSTP is tracking the latest on the situation in the Twin Cities amid unrest

UPDATE: Details of curfew extensions in Twin Cities metro

Minneapolis Police start to arrest protesters out after curfew

Looking for ways to help? Here are some community, donation resources in Twin Cities