New York hospitals are warning that they would lose hundreds of millions of dollars each in federal funding if Congress enacts President Bush’s budget that includes cuts to planned health care spending.

Industry officials said NewYork-Presbyterian Hospital stands to lose $67.5 million next year and $692.8 million over the next five years, while Montefiore Medical Center could lose $63.8 million next year and $559.2 million over the next five. Mount Sinai Medical Center could lose $45.6 million next year and $448.9 million over the next five years, according to the projections, compiled by New York hospital groups and publicized yesterday by Senator Schumer.

Source: Healthcare Association of New York State and Greater New York Hospital Association

“Those numbers are astronomical. There is no way that New York hospitals can absorb those kinds of cuts without cutting into the flesh and bone of the operations,” the president of Greater New York Hospital Association, Kenneth Raske, said.

The president’s $3.1 trillion budget for 2009, presented to Congress earlier this week, called for $183 billion over five years in reductions in previously planned spending on the country’s Medicare program, which funds health care for the poor and elderly, as well as doctor training. In New York, industry officials estimated that hospitals could lose $10 billion in federal funding over the next five years as a result of the reductions. New York City and Long Island would bear the brunt of those cuts, losing $7.5 billion in funding over the next five years, officials said.

“I can’t remember seeing cuts of this magnitude that are so aimed at teaching hospitals and hospitals that serve the poor,” Mr. Raske said. “We’re going to downsize, lay off, close services in order to keep the operations moving.”

In a statement, Mr. Schumer, a Democrat, said he would urge the heads of the Senate Budget Committee to remove the cuts from the congressional budget, to be released this spring. “New York hospitals and their patients depend on this funding to survive,” he said. “I am going to fight it tooth and nail every step of the way.”

Bush administration officials have said the Medicare system is inefficient and needs changing. Medicare spending grew to $396.3 billion in 2008, up from $52.6 billion in 1983, Mr. Bush’s Health and Human Services secretary, Michael Leavitt, said in a budget briefing on Monday. The proposed budget would increase that a further $29.2 billion in 2009.

“There are those who will be unhappy with this budget, but given the Medicare system we have, putting off solving the problem is no longer acceptable,” Mr. Leavitt said in a statement posted on the HSS Web site. The statement pointed out that the reductions in planned spending would slow the Medicare program’s annual growth rate over five years to 5% from 7.2%.

The hospital industry warned that cuts would be felt most acutely in New York because it is a hub of medical training. Statewide, there are 56 major teaching hospitals and 13 medical schools, which train an estimated 16,000 residents, or 17% of the nation’s physician residents, annually.

Yesterday’s analysis indicated that Manhattan’s 20 hospitals collectively could lose $259 million in federal funding in 2009 and more than $2.6 billion over the next five years. Among individual hospitals, NewYork-Presbyterian’s projected loss of $67.5 million in funding next year is the highest. NYU Medical Center could lose $17 million in 2009, and Bellevue Hospital Center could lose $8.3 million, officials said. Calvary Hospital in the Bronx, a specialty hospital that provides palliative cancer care, or care that aims to reduce pain without a cure, stands to lose the least, $15,000.

“If changes need to be made, they need to be made across the board. But so far what it looks like is that New York would suffer more,” Rep. Vito Fossella, a Republican of Staten Island, said. “New York City teaching hospitals are going to get hammered, and ultimately it will have an impact on access to care.”

Hospital industry officials said the first services to be downsized would be ones that are least profitable, such as outpatient clinics, dialysis, and obstetrical services. Staffing levels in emergency rooms could also be reduced.

“It could be any service that has been historically negative in terms of the bottom line,” GNYHA’s Mr. Raske said. “This is a question of survival versus a question of providing a well-rounded set of services.”

Health policy analysts said the impact of these proposed cuts would be felt for several years.

“The federal strategy is not only a cut strategy, it is a deep cut strategy and it’s a multi-year strategy,” the president of the United Hospital Fund of New York, James Tallon, said. He pointed to similarly steep cuts in 1997 that reverberated through the industry for several years.
He added that the cuts represented a “one-two punch from Washington,” following changes in Medicaid regulations proposed last year. “This is sort of the second shoe dropping,” he said. “Clearly, the administration decided to end its tenure with a very provocative and deep set of cuts.”

Mr. Raske also warned that federal budget cuts could undermine Governor Spitzer’s health care agenda in New York, which Mr. Spitzer outlined in a budget proposal earlier this month.

“Any programmatic change that the governor puts forward that is positive is totally undermined by the Bush budget,” Mr. Raske said.