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LI Hospitals Cut Even More

State Budget Amendments Not All Hospital Friendly

(Hauppauge, NY ... February 17, 2010) Long Island’s hospitals could see even steeper Medicaid cuts than originally proposed in the Executive Budget, thanks to budget amendments set forth last week bythe governor. Cuts to Long Island hospitals total nearly $46 million, an increase of about $6 million, and spare no hospital from reductions.

In his 21-day budget amendments, the governor backed off his proposal to redirect Indirect Medical Education and indigent care dollars, a proposal that would have benefitted a few hospitals on Long Island but hurt most. Under the amended proposal, the net effect is negative for all Long Island hospitals. What remains from the governor’s original budget proposal is an increase in the gross receipts tax (GRT) on inpatient services, elimination of the Medicaid trend factor, a $186 million cut to indigent care, and a proposed reimbursement cut to hospitals with high rates of readmission.

“The GRT was originally instituted as a temporary assessment. Yet, it is plainly a tax and now the governor seeks to make it permanent. This move alone will decimate Long Island’s hospitals, as it represents nearly half of the proposed Medicaid cuts,” said Kevin Dahill, president/CEO of the Nassau-Suffolk Hospital Council (NSHC), the association that represents Long Island’s hospitals.

Long Island’s hospital administrators say these cuts – the seventh to occur in just two years – make the daily operation of a hospital difficult and dangerous. These frequent disruptions in revenue affect staffing and services. Since April 2008, Long Island’s hospitals have endured $180 million in Medicaid cuts, according to the Healthcare Association of New York State (HANYS).

“In recent years, we’ve seen some maternity units eliminated, hundreds of hospital employees laid off, and a significant decrease in health screenings, educational programs, and related services that communities rely upon,” said Dahill. “Little by little, Albany has eroded the foundation of hospital-based health care services on Long Island.”

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