HOUSTON – "The reality is that healthcare has changed," MD Anderson President Ronald A. DePinho, M.D. said.
MD Anderson leaders say it's what they've been working hard to avoid -- up to 900 employees will be looking for a new job.
"Physicians will not be impacted by the reduction, which will allow us to continue providing exceptional patient care," DePinho said.
DePinho said the decision wasn't easy and was influenced by many factors.
Raw video: Officials answer questions about MD Anderson layoffs
"Escalating health care costs of our nation, progressive reductions in reimbursement of care. And expanding health care needs due to the aging of america," DePinho said.
Another strain is the march implementation of electronic health records. It was a long, arduous transition, one DePinho says they had to prepare for.
"Perhaps we staffed up a little more than we should have," Executive Vice President of Administration and Chief Financial Officer Dan Fontaine said.
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The layoffs will concentrate on areas that have grown because of that transition, focusing on employees in finance and administration, including some management roles.
The hospital also accepted fewer patients during that time to help ease the switch-over, which is another factor.
"We are seeing a recovery trend, but more time is needed," DePinho said.
And with uncertainty in Washington over the future of how we pay for health care, the team says they're trying to look to the future.
MD Anderson layoffs: expecting to save $120 million/yr through layoffs and previous retirements @KPRC2
— Samantha Ptashkin (@SamPtashkin) January 5, 2017
"If we're going to put ourselves into a position of having financial security to be here for patients for years to come, we've got to take some steps now," Fontaine said.
The layoffs began Thursday morning, and will continue taking place over the next week. Many of those employees have not yet been notified.