MVP Health Care laid off 68 employees Thursday in a restructuring tactic company officials say will ensure that MVP can keep its health plans affordable to customers.
Forty-one of the layoffs occurred in Schenectady, where the company employs about 1,000 workers between its headquarters at 625 State St. and an office a few blocks away at Center City. MVP’s office in Rochester had 19 layoffs, with eight more across the rest of the company’s locations in the Northeast.
“This was a difficult, yet necessary, decision,” company spokeswoman Robin Wood said in a news release.
In addition, 19.5 vacant positions were eliminated. Wood could not specify which positions were eliminated, or from what departments. But she said they were across all levels and functions.
“The cuts are across the entire company, designed to minimize the disruption to customer service and ongoing work,” she said.
This is the second round of layoffs at MVP in the last year. In May 2012, the company laid off 48 workers, including 22 locally. Those layoffs came on top of an earlier cost-cutting effort in which 63 employees took early retirements.
The company now employs just more than 1,600 workers at its nine locations in New York, Vermont and New Hampshire.
Both rounds of layoffs were designed to lower health plan premiums. Medical costs and administrative costs affect premiums the most, Wood said, and MVP has already implemented “innovative changes” to lower medical costs.
Last year’s layoffs came after the company had already tried to trim costs by reducing travel, consulting costs, integrating computer systems and spending less on postage and paper. At the time, company officials said they weren’t expecting any additional layoffs in the future.
“It is more critical than ever to address administrative expense,” Wood said. “This workforce restructuring is one of many steps we are taking to decrease administrative costs and maximize MVP’s ability to be successful.”
In its statement, MVP said it has aggressive goals to reduce administrative costs. Wood said the company will not disclose how much it expects to save through the latest round of layoffs, or by how much it is trying to drive administrative costs down.
“This restructuring is an effort to better align MVP with the needs of our customers,” Wood said. “We pride ourselves on our excellent customer service. A key part of that commitment to our customers is keeping health insurance affordable, and so this is about controlling those administrative costs.”
The restructuring should have no effect on MVP’s participation in New York state’s health exchange, which state officials expect to debut later this year.