Hospitals Worried By Report

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The New York Sun

Panic is setting in among New York’s money-hemorrhaging hospitals as Governor Pataki’s health care commission nears completion of a first draft of proposals for revamping the state’s troubled health industry.

Late next week, commission members are set to receive confidential advisory reports that will likely include lists of hospitals and nursing homes marked for downsizing or closure. Although the reports are nonbinding, they represent the first time the commission is formally considering recommendations and are the object of intense speculation and fear in the industry.

“If you’re on this preliminary list, it’s going to be hard to turn this around,” the director of government affairs for the Business Council of New York State in Albany Elliott Shaw, who specializes in health care policy, said.

Representatives of some of the most vulnerable hospitals in the city said yesterday they did not know of the contents of the preliminary proposals, which the commission is aiming to keep under tight wraps until its deadline of December 1, when it is supposed to submit its final report to Mr. Pataki in the last days of his governorship.

There are growing signs that hospital executives are girding for a massive public relations battle — along the lines of the protests that greeted Mayor Bloomberg’s firehouse closings in 2003 — that will grow with intensity in coming weeks and draw into the debate city leaders, state lawmakers, and the front-runner in the governor’s race, Attorney General Eliot Spitzer.

In preparation for worst-case scenarios, hospitals are quietly retaining lobbying and public relations firms and reaching out to local lawmakers for support, according to advisers to the commission.

The behind-the-scenes maneuvering by the hospitals is expected to give way to a full-scale campaign, entailing television advertising, protests, and lawsuits, that could be coordinated with the expected return of lawmakers to Albany after the November elections for a special session.

Also looming in the background is the powerful health care workers union, 1199/SEIU, which earlier this year spent millions of dollars on a television and print advertising campaign that lambasted the governor for trimming Medicaid funding for hospitals and nursing homes. The ads were thought to have contributed to a further dip in the approval rating of Mr. Pataki, who later agreed to restore much of the cuts in a budget deal with lawmakers.

“They are not coming out and holding press conferences,” a member of a regional advisory committee said. “They are preparing themselves to attack the commission, to take legal action, and to lobby, lobby, lobby.” One struggling downtown hospital has hired the lobbying firm of a former senator, Alfonse D’Amato, according to the committee member, who did not wish to be identified because of the confidential nature of the commission’s work.

Last year, Mr. Pataki formed the New York State Commission on Health Care Facilities in the 21st Century to come up with a plan for overhauling the state’s hospital industry, which is plagued by deficits and saddled with excess capacity that have contributed to the state’s soaring Medicaid costs.

The chairman of the commission, Stephen Berger, a former executive director of the Port Authority of New York and New Jersey, told The New York Sun that the commission is “digesting vast amounts of material,” but he would not comment on which hospitals might be on the cutting block.

He said he expects that any money saved by the restructuring and closings proposed by the commission would be reinvested back into the health care system, either in the hospital industry or in other areas such as primary care or managed care. He does not anticipate an actual reduction in total Medicaid spending, which is approaching $50 billion a year.”The issue is how you stop the growth,” Mr. Berger said.

Mr. Pataki picked the majority of the commission’s members. Others were selected by the Democratic Assembly speaker, Sheldon Silver, and the Republican Senate majority leader, Joseph Bruno, who rely on the hospital industry and health care union for contributions and other forms of support.

Since then, the commission has held 19 public hearings, collected testimony from hundreds of people, and conducted hundreds of meetings with the more than 230 hospitals in the state, some of which have entered into discussions about voluntary mergers and consolidations with other hospitals.

Using data supplied by the state health department, the commission is employing a complicated set of metrics to help it decide the fate of hospitals. The metrics take into account such factors as profitability, the racial makeup and economic status of patients, volume of visits, the economic impact the institutions have on surrounding communities, the quality of care, and commute times to neighboring providers.

The preliminary reports are to be submitted by 72 advisory committee members to a smaller group of regional commissioners, who are free to make any adjustments. Their final reports are supposed to be presented to the full commission in early November.

After the commission releases its final report, Mr. Pataki can approve or reject it. If he accepts, the proposals become law as long as the Legislature does not act to amend or block it.

Mr. Spitzer, a Democrat, has said that as governor he would not be bound by the commission’s report, but he has said he is not opposed to closing hospitals. If he disapproves of the recommendations, Mr. Spitzer could seek to pass legislation that could put it in permanent limbo.

For now, hospitals executives are tracking the commission’s progress with caution. “It’s inconceivable to me that anybody would consider closing a hospital like ours,” the chief executive officer of New York Downtown Hospital, Bruce Logan, said.

Yesterday, the hospital marked the opening of a $25 million emergency room with an event that drew Mr. Silver, whose district includes the Lower Manhattan hospital, and the borough president of Manhattan, Scott Stringer.

The hospital, which is the only one serving Lower Manhattan with 170 beds in use, treated many of the victims of the September 11, 2001, terrorist attacks, and took a financial hit after the disaster. It has recovered somewhat. Mr. Logan said the hospital was projecting a $9 million loss this year, compared with a $17 million loss in 2002.

The New York Sun

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