The U.S. Department of Health & Human Services (HHS) on Thursday announced thousands of employee layoffs, resulting in a loss of nearly one-quarter of its full-time workforce.

The layoffs are part of a restructuring process in accordance with an executive order from the Trump administration known as the Implementing the President’s “Department of Government Efficiency” Workforce Optimization Initiative.

The restructuring initiative follows the recent appointment of new HHS Secretary Robert F. Kennedy Jr., who indicated the layoffs were designed to minimize bureaucratic challenges. The move is designed to realign with Kennedy’s priorities to addressing issues around chronic disease and serious illness, as well as rising health care costs, he said in a recent HHS statement.

“We aren’t just reducing bureaucratic sprawl. We are realigning the organization with its core mission and our new priorities in reversing the chronic disease epidemic,” Kennedy said in the statement. “This Department will do more — a lot more — at a lower cost to the taxpayer.”

The layoffs included roughly 10,000 employees. They coincided with HHS’ recent efforts to transform the agency’s workforce including offering staff early retirement options and the Trump administration’s Fork in the Road program, which offered three-month severance packages for voluntary resignation.

All told, roughly 62,000 workers remain at the agency, a 24.4% drop from 82,000 prior to the layoffs. The workforce reduction will save roughly $1.8 billion in annual tax payer dollars, HHS indicated in the statement.

Impacts include regional office closures and an overall reshaping of health care subagencies under the HHS including the U.S. Centers for Medicare & Medicaid Services (CMS), the National Institutes of Health, the U.S. Centers for Disease Control and Prevention (CDC) and the U.S. Food & Drug Administration, among others.

About 300 of the HHS layoffs occurred at CMS, representing 4% of the agency’s overall workforce, reported the Wall Street Journal.

Jeff Grant, the former deputy director for operations of the CMS division that oversees Obamacare and other programs, recently told Politico that the agency has been understaffed for years.

The restructuring initiative will “streamline the functions” of the agency, HHS stated. Half of its regional offices will close following the layoffs, while its current 28 divisions will face a consolidation process. The remaining 15 new divisions will include the Administration for a Healthy America (AHA), among others.

Kennedy has said that the department’s priorities include an emphasis on improving quality for terminally ill patients and their families. Kennedy has stated a commitment to reduce rising health care spending across the continuum, much of which is focused on managing chronic diseases.

A new assistant secretary for enforcement position at HHS will be created through the restructuring process. The secretary will oversee the Departmental Appeals Board (DAB), Office of Medicare Hearings and Appeals (OMHA) and Office for Civil Rights (OCR) to combat waste, fraud and abuse in federal health programs such as hospice and home health.

The restructuring is designed to improve Americans’ health care experiences by making HHS a more responsive and efficient agency while also ensuring that Medicare, Medicaid and other health services “remain intact,” according to the agency.

Programs that support seniors and people with disabilities will be integrated into other HHS agencies, including the Administration for Children and Families (ACF) and CMS. The reorganization will not impact Medicare and Medicaid services, the HHS indicated.

“Over time, bureaucracies like HHS become wasteful and inefficient even when most of their staff are dedicated and competent civil servants,” Kennedy said in the HHS statement. “This overhaul will be a win-win for taxpayers and for those that HHS serves.”

Hospice industry organizations contacted by Hospice News had no comment, pending further details.

The family caregiver advocacy group Caring Across Generations released a statement late Thursday.

“The Department of Health and Human Services has long been a vital resource for older adults, disabled people, and especially our country’s 100 million family caregivers,” Nicole Jorwic, chief of campaigns and advocacy at Caring Across Generations, said in the statement. “We are deeply worried that organizational changes and workforce reductions will only exacerbate our country’s patchwork care infrastructure that millions of families are already struggling from. Rather than fulfilling campaign promises to help families, President Trump is relentlessly continuing to pursue his political agenda even if that means causing continued harm to older adults, disabled people, caregivers and care workers.”

The layoffs would impede access to essential health care for many patients, particularly those with cancer, according to Dr. Wayne A. I. Frederick, interim chief executive officer of the American Cancer Society and the American Cancer Society Cancer Action Network.

“Public servants at CMS help the almost 148 million people who have health insurance through Medicaid, including roughly 1 in 3 children with cancer, and Medicare nationwide,” Frederick said in a statement. “Reducing a workforce dedicated to providing health insurance coverage that makes it possible for individuals to see a doctor regularly, get cancer screenings and access cancer treatment or survivorship care could have life-threatening consequences.”

Katie Smith Sloan, president and CEO of LeadingAge, the association of nonprofit providers of aging services, raised three areas of concern about the staff reductions:

• Consolidating HHS field offices from 10 to 5 may, for instance, impact the ability of the Centers for Medicare and Medicaid Services (CMS) to carry out survey, certification and enforcement activities in a timely manner. CMS locations, working out of HHS field offices, oversee the nursing home survey process, consult with states on providers’ compliance with requirements and more. CMS locations are also responsible for waiving certain requirements and oversight of disputed citations. 
• Decreasing overall staff by almost 25% is a massive downsizing that should be undertaken with the utmost care and sensitivity to impact – particularly on the millions of older adults who rely on HHS programs and services. We are concerned that carrying out staff reductions at a dramatic scale such as this on a tight timeline does not allow for a thorough consideration of short- and long-term impacts to our country’s older adults and those who care for them.  
• Redistributing the programs currently overseen by the Administration for Community Living, including programs authorized by the Older Americans Act, must be done in a way that supports and augments their value, rather than simply moving them solely for the sake of reducing the HHS office or employee count. These important programs that deliver vital services, including home care, food and transportation to millions of older adults in need nationwide, must be supported and not pushed into obscurity. 

“The Department of Health and Human Services, through its agencies and offices, operate many of the programs and provide critical services and guidance that our nonprofit and mission-driven members–including providers of care in nursing homes, in home health care settings, hospice, adult day and Programs of All Inclusive Care for the Elderly (PACE) — rely on to serve older adults and their families,” Smith Sloan said in a statement emailed to Hospice News. “We are closely monitoring the execution of today’s announcement. We urge HHS to ensure that older adults and the providers who serve them will not be an afterthought in this reorganization.”