Up to 650 employees are being laid off at Nashville, Tenn.-based Vanderbilt University Medical Center as it plans to reduce operating costs by more than $300 million in response to government-sponsored medical research and anticipated reductions to Medicaid reimbursement.

VUMC said in May that an unspecified number of positions were being eliminated and hiring would be paused for “most research and administrative positions.” A spokesperson said in a June 20 statement shared with Becker’s that the layoffs affect those working primarily in research, administrative and other support areas.

“While this is extremely difficult, the staffing loss represents less than 2% of VUMC’s total workforce,” the statement said. “To support affected employees, VUMC is providing severance packages and other assistance.”

VUMC said it is continuing to hire frontline clinical staff for the opening of the 180-bed Jim Ayers Tower, which is expected to open later this year.