Mid-year budget cuts that have come out of the executive chamber in Albany target several hospitals in the Western New York region, three of which serve patients in the area.

According to a recently released document, hospitals in the eight-county region of Western New York are slated to see a total of nearly $14.5 million lost to the proposed cuts in Medicaid reimbursements. The cuts are proposed to continue into 2010, and into 2011, ultimately cutting almost $29 million out of the operating budgets of hospitals in the region.

For Olean General Hospital, their share of the cuts, for the time frame of Nov. 15 to March 31, 2010, is proposed to be $192,000, with an additional managed care loss of $157,000.

Cuba Memorial Hospital would be facing a total loss of $80,000 in Medicaid funding. Jones Memorial Hospital, in Wellsville, would see cuts of $157,000 in Medicaid reimbursements, and an additional $2,000 loss in managed care and other related expenses as well.

These cuts are not the solution to closing the budgetary gap that the current administration in Albany is seeking, said Timothy J. Finan, president and CEO of Upper Allegheny Health System.

“The answer to resolving the budget crisis is not further cuts in health care,” he said in a statement. “Every single year, for the past 15 to 20 years, health care providers have had to bear the brunt of the state’s inability to live within its means. Health care providers are now reimbursed at levels less than the costs they expend to provide care. The state would be well-advised to reduce the size of the government it has created rather than consistently attempting to reconcile the financial mess it has created by marginalizing our health care system.”

John Bartimole, president of the Western New York Healthcare Association, said the proposed cuts, and the history of them, has become something his organization cannot take.

“The situation is intolerable,” he said. “We recognize that the state is in a financial dilemma of historical proportions, but we can’t sacrifice hospitals by putting them on the precipice of making choices that will involve the curtailment of services and access.”

The proposed cuts, Mr. Bartimole said, are something the hospitals in the area have become used to seeing.

“These cuts have been happening every year,” he said. “There is a history of budget cuts in health care for the past year and a half. It actually goes back to the Spitzer administration. His were the most onerous cuts, but always seemed to be rolled back. Health care has always been a target.”

But the problem lies much deeper than just the state cuts, Mr. Bartimole said. It seems that when state money is cut, in this instance, federal dollars go with it.

“The problem is, when you cut the state Medicare funding, you are also cutting the federal match,” Mr. Bartimole said. “In essence, when you cut a dollar, you are really cutting three.”

Robert Bruckner, chief financial officer of Jones Memorial Hospital, agreed that this is more of the same thing hospitals have been seeing for the past 17 months.

The governor’s proposed deficit reduction effort “actually means additional cuts,” he said. “We will see an additional $318,000 in reduction to our Medicaid reimbursements.”

And those cuts, if enacted as written, will mean cuts of some sort in the hospital.

“This is what we use to pay salaries,” Mr. Bruckner said. “We would have to come up with $318,000 in savings, if the cuts go through.”

Mr. Bruckner said it is “crucial that we get to members of the Senate and Assembly and encourage them to reject these cuts in medical coverage.”

A special session of the Legislature was convened to address the growing state budget deficit earlier this week, only to be adjourned without any action on the cuts proposed by Gov. David Paterson.

Cuba Memorial Hospital CEO Andrew H. Boser III could not be reached for comment on how the proposed cuts would impact operations at his facility.

Upper Allegheny Health System is the parent organization that controls Olean General Hospital and Bradford Regional Medical Center.

(Contact reporter Chris Chapman at cchapman@oleantimesherald.com)

Impact charts for Olean General and Cuba Memorial

Hospital........Nov. 15 to March 31, 2010 cuts...........Next 16.5 months

Olean General......$192,000...............................$384,000

Cuba Memorial......$80,000................................$160,000

Jones Memorial.....$$157,000..............................$314,000

OGH will lose an additional $157,000 from Nov. 15 to March 31, 2010 in the form of Managed Care, Workers’ Comp. & No Fault impact. Over the next 16.5 months, the hospital stands to loose $314,000. Jones memorial will see an additional $2,000 come out for the same thing over the short-term, with $4,000 in the longer term.

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