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Criticism and Restructuring

UMass Memorial Healthcare faced a downhill financial slide over a 5 year period, starting with an operating surplus of $83 million in 2009 to a $55 million operating loss in the 2013 fiscal year. The organization was criticized for being inefficient. In addition, changes in healthcare reimbursement impacted the Medical Center more severely that other hospitals as its proportion of Medicaid patient business, the state-federal health plan for the poor that tends to be less lucrative for hospitals, is 25% higher than the statewide average (24% in 2012 compared to state average of 19%). The financial decline culminated to the downgrading of the system's rating by Moody's Investors service in 2013.
In response to this criticism and challenges, UMMHC underwent significant restructuring towards a more lean business model. Shedding of assets included the sale of UMass health care and hospice business , UMass outreach laboratories and the Caitlin Raymond International Registry (although dissociation from the latter has been postulated to also relate to the public criticism of the Registry's practices). A number of employee positions (reportedly over 500), predominantly in non-patient contact areas were also eliminated, in an effort to improve system efficiency. In December 2013, UMMHC announced its intend to transfer ownership of Wing Memorial hospital to Baystate Health in Springfield, MA. Following the above changes, along with an effort to standardize clinical and busines sprocesses, the system reported a stabilization of its financial position.