Alameda County Officials Look to Stave Off Mass Hospital Layoffs as Medicaid Cuts Loom

Alameda County leaders are sounding cautiously optimistic about stopping mass layoffs at the East Bay’s public safety-net hospital system ahead of a hearing on the layoff plan on Wednesday.

The latest proposal from Alameda Health System would cut 187 positions, down from earlier plans for close to 300, as executives brace for major reductions in Medicaid revenue because of HR 1 — the so-called “Big Beautiful Bill” signed into law by President Donald Trump last year.

The 187 full-time-equivalent positions equate to 211 individuals, AHS said, some of them working part-time. Those 211 employees have already received layoff notices with a March 9 separation date, though that could change. The cuts would affect nurses, therapists, food workers and administrative assistants, among others, and would eliminate some programs completely, including two that provide outpatient behavioral health services.

At a rally outside Wilma Chan Highland Hospital Campus in Oakland on Tuesday, Alameda County Supervisor Nate Miley urged health care workers to weigh in at the hearing.

“Speak your mind, let us know how these reductions in force, the reduction in labor, is going to impact safety net services so that the Board of Supervisors can come to the rescue,” he said.

The layoff plans come as AHS expects to lose over $100 million a year by 2030 as a result of HR 1 and its Medicaid cuts, a spokesperson previously told KQED. Medicaid payments make up about 60% of the health system’s revenue.

Miley, who leads the Board of Supervisors’ health committee, said he met with AHS leaders last week and sees a path for the county to come up with funding to suspend the layoffs — at least in the short term.

The current estimate, he said, is that AHS needs between $44 million and $52 million to hold back layoffs for a year. AHS officials confirmed that they are in conversations with the county “about ways they can help us, given the extensive funding cuts we’re facing,” but wouldn’t confirm the figures Miley provided, saying it was “premature.”

“My hope is the county is going to be able to kick in at least the initial $11 [million] to $13 million so that we can suspend the layoffs for a period of time,” Miley said.

He aims to create a working group made up of labor leaders, county staff, supervisors and Alameda Health System administrators and trustees to develop a more long-term plan.

Miley suggested that revenue from Measures W and A — sales taxes approved by voters to raise money for medical and essential services, among other things — could help offset some of the cuts.

He also floated the idea of the county easing up, at least temporarily, on repayment of what’s known as the “net negative balance,” essentially a county line of credit that Alameda Health System uses to cover expenses when bills come due before large state or federal reimbursements arrive.

“There are avenues we can pursue,” he said, noting that cuts to non-safety-net services might be left standing. “There might be some things that are good to have but are not necessary.”

Supervisor Nikki Fortunato Bas agreed that the county can likely stanch the bleeding in the near term, but she emphasized that the real solutions are systemic: “It’s about single payer. It’s about making sure that we close the loophole in Prop. 13 and really address how resources and wealth are distributed in our country, as well as our state and our communities.”

In the meantime, she said she would seek to hold AHS accountable for doing everything possible to raise revenue and ensure officials there are “very clear and thoughtful about what they’re looking at, and that they’re actually talking in good faith with our labor partners to make sure that we’re addressing all the potential impacts.”

Some AHS employees and their unions have criticized system executives for acting rashly.

“These layoffs are anticipatory,” said Dr. Elijah Lustig, a resident physician at Highland Hospital and union leader with the Committee of Interns and Residents, part of Service Employees International Union.

“They’re not talking to our department heads before instituting cuts or proposing layoffs,” he said of the process. “The people who are deciding who gets fired, frankly, do not have a good grasp on how this hospital runs, on what services are crucial, on what services are impacted.”

In a statement, AHS said it “must take a proactive approach” to reducing costs. “We do not approach this painful decision lightly,” it said. “However, AHS reasonably predicts that it will run out of funds within six months, by August of 2026, if it does not act now.”

Wednesday’s hearing is required by law to give the public an opportunity to comment on the proposed cuts to health care services. Supervisors won’t take any action there, but Miley said he hopes the board will reach a decision on allocating funding to prevent layoffs as soon as March 3.

The hearing takes place at 3 p.m. at the Alameda County Administration Building, Board of Supervisors’ Chambers, Fifth Floor, Room 512, 1221 Oak St.