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Committee on Paid Time Off Programs

A message from Health System leadership about the Committee on Paid Time Off Programs

We have seen a significant improvement in our finances across all units of our Health System during the past eight months, and that is no small achievement.

We have and can continue to credit the collective efforts of Health System faculty and staff, who have delivered exceptional care to more patients than ever before; reduced waste and created greater efficiencies in all areas of our institution; and garnered external research grants in an increasingly difficult funding period nationally.

But we work within an incredibly challenging health care environment, one that requires us to remain vigilant about our costs, demonstrate our value and make sound strategic investments. One only needs to read the news to learn of institutions facing huge budget gaps that require severe measures. Our own planning suggests we must improve our margin to close a projected $200-250 million gap by 2017. Doing so will allow us to meet our near-term objectives, assure our long-term success and enable our tripartite mission.

We face the same pressures as other hospitals and academic medical centers to increase productivity, make smart operational and capital spending decisions, and reduce labor and supply costs. We place a high value on our people and the benefits they receive working in our Health System, and benefit expenses are among our largest financial investments. Benchmarking shows we spend significantly more on benefits than our peers, so we must thoughtfully review those expenses.

Later today, the university’s executive vice presidents will send a message to the University community about a faculty-led committee charged with reviewing and making recommendations on retirement savings and retiree health benefits. Retirement savings changes would be implemented starting in 2015. Any recommendations for changes to eligibility or contributions toward retiree health benefits will apply only to future employees.

In addition, the Health System leadership has separately charged a committee to review and make recommendations regarding options for reducing the costs of current paid time off programs for Medical School and HHC staff. Our goal is to maintain a market competitive program while generating cumulative savings to UMHS of at least $15 million by 2018. The committee will meet this fall, and make recommendations – including when changes should occur -- to Health System leadership by November.

The programs in paid time off, retirement savings and retiree health are part of a benefits package that has long been part of what makes the University of Michigan an employer of choice. Any changes we make to these important programs will be done with great thought using some of the most capable experts in the country to help guide us. Knowing such changes will require planning on the part of staff, these will be implemented in a manner that includes advance notice to our community. 

Your feedback is important as well, and both processes will include avenues for input, which will be provided to the committees. And, we will provide regular updates on progress.

More details about the committee and its charge, as well as a list of frequently asked questions and how input will be gathered, may be found here.

Ora Hirsch Pescovitz, M.D.
Executive Vice President for Medical Affairs, University of Michigan
CEO, U-M Health System

Doug Strong
CEO, University of Michigan Hospitals and Health Centers

James O. Woolliscroft, M.D.
Dean, University of Michigan Medical School
Lyle C. Roll Professor of Medicine