UC Irvine Health, an arm of the California university that includes its medical facilities, began cutting 175 employees as Obamacare weighs on its operations.

UCI officials said the medical center is “confronting market forces, health trends and government policies that threaten our ability to fulfill our mission,” according to the Orange County Register.

Healthcare reform that came into law with the Affordable Care Act, or Obamacare, “strains our capacity” and insurance companies “are changing the way health systems are reimbursed,” officials said in a memo to staff.

UC Irvine Health employs 4,930 people in its healthcare facilities, not including the medical school. In addition to this week’s cuts, the facility eliminated 79 vacant positions.

Officials forecast the cuts may save the university $40 million for the remainder of this fiscal year that ends June 30, and another $100 million in fiscal year 2018, a spokesperson told the newspaper.