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Oracle cuts jobs in troubled Cerner health unit

By Nithya Bose in US business news, posted June 16, 2023

Oracle has reportedly conducted layoffs, revoked job offers, and removed open positions within its health unit.

Sources said the job cuts affected hundreds of employees.

Severance packages for laid-off workers include four weeks' pay, an additional week for each year of service, and compensation for unused vacation days.

Oracle Health, which encompasses health IT leader Cerner, was acquired by Oracle last year in a deal valued at approximately $28 billion.

Current and former employees have said that Oracle has ceased promotions and raises.

It laid off thousands of people within the unit following the acquisition.

The recent cuts are primarily linked to challenges faced by Cerner in its contract work with the US Department of Veterans Affairs.

The government agency enlisted Cerner to replace its in-house medical records system with Cerner's technology.

However, the project, initiated in 2020, has encountered numerous setbacks and delays.

Most recently, the VA paused the rollout in April due to issues encountered at deployed sites where Cerner's records were implemented.

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In May, the VA and Cerner renegotiated their contract to hold Cerner more accountable, but this resulted in reduced government-related work for Cerner, leading to the recent job cuts.

Cerner holds significant importance for Oracle as its largest acquisition.

Chairman and CTO Larry Ellison has made it a primary focus, envisioning a groundbreaking cloud-based health data system enabling healthcare providers and public health officials to access patient data across organizations.

Ellison believes this system will showcase Oracle's cloud business to the world as a game-changer in the industry.

Oracle has declined to comment on the matter.

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