MMH board votes to privatize Massena hospital
Thursday, March 27, 2014 - 2:51 pm

By ANDY GARDNER

MASSENA -- Massena Memorial Hospital’s Board of Managers has voted to recommend the institution becomes a private, non-profit.

“Now the decision moves to the Massena Town Council, since we are a municipal entity,” MMH director of public relations and planning Tina Corcoran said.

The decision came after a 9-0-1 vote on March 24. The abstaining vote was newly-appointed board member Loretta Perez.

The hospital is looking at going broke by 2017, according to a recent study by FreedMaxick CPAs. Although MMH officials have released limited information, its board will share with the public their full findings on April 10.

Massena Memorial Hospital finished February nearly a half-million dollars in the red for the month alone, according to a financial and statistical summary they released Monday night.

The document shows the institution suffered a $425,865 net loss. The number defied the hospital’s estimate – they figured on a $60,740 loss for the month of February. Year-to-date, MMH has reported losing $388,181 and budgeted to lose $188,261. The difference is due to an approximate $37,000 net gain for the month of January.

Over the same time last year, they lost $1,044,030. In February 2013, they lost $655,094.

MMH chief financial officer James Smith said the February 2014 loss is due to about 40 fewer in-patient discharges than budgeted.

“It comes out to about $300,000 in lost revenue, that’s the main factor,” Smith explained during a Thursday phone interview.

He said that although the budget estimates a loss for February, it balances over the course of the year.

“Our budget for 2014 is essentially to break even for the year,” he said, adding that they calculate their annual numbers based on the last three years.

Supervisor Reacts

Town Supervisor Joseph Gray said he figured the hospital board would decide as they did, but is surprised it happened so quickly.

“I think it would make sense to wait until we have a public meeting about it,” he said Thursday.

But, Gray said, he realizes “the clock is ticking” for MMH and “their reserves are dwindling every month.”

He said it’s not certain, but the town board may vote in favor of privatization when it comes up.

“It’s hard to say, but I have a gut feeling the board doesn’t see a lot of other options,” he said.

Before his board votes, Gray wants “to get everybody in the same room” – town leaders, MMH officials and union heads.

“It won’t be pretty, it won’t be fun,” he said.

Union officials have claimed at several town board meetings that they have ways to save money to avoid privatization, but hospital administration won’t listen.

“If the union says you can save money, you show us how. If the hospital says it won’t work, prove that,” he said.

But the ultimate goal has to be retention, the supervisor said.

“We need to keep the hospital open and mitigate any possible impact on the taxpayers of Massena … keep as many jobs and keep as many of those salaries as possible,” according to Gray.

Study To Be Made Public

Corcoran said the FreedMaxick study in its entirety will be made public prior to the April 10 meeting. She said the union and all MMH department directors will have copies to share with their membership and employees. It will also be posted to the MMH website.

Wayne Lincoln, a vice president of the local CSEA chapter that represents MMH employees, said at a March 19 Town Council meeting that hospital leadership was refusing to give them the FreedMaxick documents, which were made public by the hospital board in February. He said the entire union is frustrated because they feel the administration is shutting them out.

“We’ve told them we want to be part of the solution, we’ll do anything … but there’s been nothing,” Lincoln said.

Councilman Albert Nicola reminded Lincoln that no matter what the MMH board decides, the ultimate decision rests with the Town Council and the state Department of Health.

Town Board Wants More Info

“We’re not going to make any decisions until we’re satisfied we have all the information,” Nicola told a room of about 25 at the March 19 town board meeting.

Councilman Samuel Carbone said he won’t feel confident casting a vote until he learns more than what was shared with town officials in a February 24 executive session. He wants to see a list of all employees, who is in what state retirement tier and potential downfalls of privatization.

Gray said the board may take its time coming to a vote because of having two new councilors, Carbone and Thomas Miller.

“They need time to understand this, and make sure all their questions are answered,” Gray said Thursday. “I don’t think anybody [on the board] is completely satisfied yet.”

In the February meeting, FreedMaxick gave the results of their look into the hospital’s future under three scenarios: status quo, becoming a private non-profit and becoming a public benefit corporation.

A limited amount of their findings were made public. By remaining a town entity, MMH will be $3.2 million in the red by 2017, the study suggested.

“If you’re going to go bankrupt, none of you are going to have jobs,” Councilman John Macaulay told the MMH contingent at the March 19 town meeting.

If they privatize, they could have $7.4 million on-hand by that same year. The numbers were based on projections based on 2010 – 2013.

According to Macaulay’s calculations, the town would have to grossly inflate the tax rate to make up the $3.2 million deficit.

“Every person would pay triple their town taxes,” he said.

At the February meeting, Fahd said another option would be to cut about $4 million from their current operations.

Lincoln said he thinks it could be done because MMH is “spending money like crazy. If we’re in dire straits, why are we spending so much money?”

MMH Employee Concerns

Many hospital employees are worried about losing their state retirement benefits. Some are only a year or two away from being able to get the maximum payout when they hang up their scrubs.

Heather Gardner, an obstetrical and nursery RN said at the March 19 town board meeting that the state retirement is part of what makes hospital jobs so attractive and some may seek employment out of the area to stay in the system.

“The New York state retirement is so important for us, some of us would have to move,” she said.

Gardner is concerned that hundreds of people that were making decent money, paying taxes and helping fuel the local economy could hurt Massena.

“What are we going to have left? What is our community going to be?” she said.

The town board and the hospital workers all agreed on one thing – no matter what happens, the hospital must remain open.

“When people talk to us on the street, that’s the first question – ‘Are we going to have a hospital?’” he said.