1. Michigan Medicine’s economic recovery plan

    May 5, 2020

    Dear Colleagues:

    Over the last several weeks, Michigan Medicine has provided life-saving care to the people of our region and state. Health professionals have courageously stepped up on the front lines of the COVID-19 pandemic and worked around the clock. Hospitals and clinics quickly transformed the way they work to maximize employee and patient safety.

    All of these important actions are a quintessential part of the University of Michigan’s mission to serve the public – but they were also extremely costly from a financial standpoint. As we have shared, the pandemic has created a set of challenges for our health system similar to those that medical centers across the nation and around our region must confront. By postponing non-emergency procedures and focusing on COVID-19 care, Michigan Medicine faces significant losses in the current and next fiscal years.

    Earlier today, Michigan Medicine announced an economic recovery plan to address these challenges. The plan includes organizational restructuring, postponing most construction projects, and reducing personnel costs through leadership salary cuts, attrition, strict limits on hiring, suspension of the employer retirement match, and reductions in force –  and they are in addition to those previously announced for all of U-M. These were difficult decisions made by Michigan Medicine leadership to meet these financial challenges and uphold our high standards of patient care while preserving as many jobs as possible.

    The measures taken by Michigan Medicine today reflect both the severity and rapid onset of financial difficulties from the COVID-19 pandemic. Our Medical School is inextricably linked to Michigan Medicine in its funding and operations – so, along with the health system, it is facing different challenges than our other schools and colleges.

    Every part of our university is being challenged differently, at varying speeds and with outlooks based on their unique circumstances. And while some of our actions will necessarily be specific to a part of our institution such as those outlined by Michigan Medicine, others such as those I described in my previous messages affect the entire university. These include restrictions on discretionary spending and travel, hiring and salary freezes, and voluntary temporary furloughs. I want to remind everyone that the deadline for non-Michigan Medicine staff to request a temporary furlough or temporary reduction in hours is this Friday, May 8.

    It may seem incongruous to be taking these actions while all parts of our university, including Michigan Medicine, continue to plan for the gradual resumption of more normal activity. This is the reality we are facing amid the uncertain future presented by the pandemic, even as we remain hopeful in our work.

    All of our efforts will help the institution weather this crisis and continue delivering its mission as we ramp up our research, education and patient care.

    Our Ann Arbor, Dearborn and Flint campuses will continue to plan for a public health-informed fall semester on campus. As Ann Arbor’s Interim Provost Susan M. Collins shared Friday, our commitment to excellence for our students has not changed – and we are excited to welcome the Class of 2024 to our campuses this fall. Recent weeks have only reinforced the fact that our society needs talented, hard-working, educated students, with the knowledge and skills to solve big problems.

    All across our university over the past two weekends, we celebrated the accomplishments of the graduating Class of 2020. Our Ann ArborDearborn and Flint campuses shared messages of congratulations from our amazing community, and we saw many graduates’ stories of perseverance and achievement. The strength of a U-M education, the potential of our graduates, the pandemic response of Michigan Medicine, and the promise of our COVID-19 research are parts of our mission that we can all find hope in. Each makes us excellent, and I again thank everyone for your contributions to the enduring impact of our university.

    Sincerely,

    Mark S. Schlissel, M.D., Ph.D.
    President