Dear Colleagues,

Recently, there has been misinformation conveyed about the financial state of Keck Medicine of USC and the tentative agreement offered to our nursing colleagues that are members of the California Nurses Association (CNA). In the pursuit of honesty and fairness, it is important for me to set the record straight with all members of our community.

Keck Medicine Finances
There have been reports that Keck Medicine had a 2024 revenue surplus of $500 million. This number is false. Rather than a surplus, our 2024 revenue, less expenses, resulted in a shortfall of $33 million for the health system.

In 2025, our financial performance declined even further. The financial pressures confronting hospitals and health systems nationwide have challenged us as well, and those burdens include significant reductions in federal and state funding, decreases in insurer payments and a spike in medical-supply inflation.

It has been suggested in various forums, that with our falsely reported “revenue surplus,” we should have spent more on our workforce, but the surplus never existed. Nevertheless, we are very committed to ensuring our workforce receive market competitive wages and benefits and are afforded the ability to work and provide care in an environment with the necessary tools and resources to meet the physical and emotional demands of the care we provide.

In fact, demonstrating Keck Medicine’s commitment to competitive compensation, it is worth noting that in Keck Medical Center’s 2024 990 tax filings, which are publicly available, three of the top 25 highest paid individuals listed in the filing are union-represented nurses, with the salary for these nurses ranging between $383.4K, and $541.8K.

Maintaining Stability and Quality Care
Unfortunately, the 2024 shortfalls and 2025 industry pressures led to budget cuts and eventually, lay-offs last August. While a very difficult decision to make, it was essential for the financial sustainability of Keck Medicine and to not adversely impact the many critical programs that serve our workforce and patients.

Some have implied that these cuts compromised patient care. This is untrue, we were very intentional in not impacting the high quality and safe care patients have come to expect from Keck Medicine. For example, we made certain that not a single bedside nursing position was eliminated. Our patients continue to receive the same excellent care as before under the watch of our talented and expert health care professionals.

In Closing
As many of you have heard directly from me, I strive to create a culture of trust at Keck Medicine, founded in integrity, respect and transparency which is why I am committed to separating truths from falsehoods.

Be assured that I value and support every one of you and the tremendous impact you have on our patients, colleagues and community.

I close with great appreciation for all you do for our patients, their loved ones, and each other every day.

Sincerely,

Rod Hanners
Chief Executive Officer
Keck Medicine of USC