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Massena supervisor forming committee to study future of hospital

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MASSENA — Town Supervisor Joseph D. Gray has announced that a committee will study the future of the municipally owned Massena Memorial Hospital.

Mr. Gray sent an email Thursday evening to the major parties associated with the hospital asking them to appoint representatives.

“Participation on this committee isn’t a request,” he wrote. “It will be formed and will convene before the end of September. We will meet behind closed doors to facilitate a frank and productive discussion.”

The chairman of the hospital’s board of managers reacted coolly.

“We haven’t come to any conclusion” as to the future of the hospital, Andrew T. Spanburgh said. “That’s why we think it’s a little premature to come and make the joint committee.”

But he later added, “At this time I really haven’t taken a close look” at Mr. Gray’s email, “and am not sure what to think.”

The committee will include members of the Town Council, the hospital board of managers and the hospital’s administration, as well as local representatives from the Civil Service Employees Association and the New York State Nurses Association, Mr. Gray said.

“All parties will be represented, and the public will be kept fully informed throughout the process,” he said. “As I have said repeatedly, we don’t yet know which direction the hospital will move in the future, but the public and Massena taxpayers can rest assured the Town Council has no intentions of closing the hospital or selling it to some outside corporation.”

The town supervisor said that the committee will look at numerous options for the hospital’s future and that everything will be on the table: vendor and employee contract issues, the budgetary impacts of salaries and benefits for all hospital employees, the profitability and necessity of various hospital clinics, physician performance, hospital expenditures and hospital board decisions and how they affect the hospital’s bottom line.

Meanwhile, hospital officials agreed last month to retain Hancock Estabrook LLP, a Syracuse a law firm, to explore transitioning from a municipal hospital to a private, nonprofit facility.

Hospital board members had agreed at their July meeting to hire the law firm at a cost not to exceed $100,000 for the study. The study will consist of three phases. Phase one will include the study of all contracts, such as with vendors and employees, to see if anything would prohibit changing their status.

Phase two would be the implementation phase. Following approval from the Town Council, the hospital could start filing paperwork such as the Certificate of Need to begin the conversion process.

The third and final phase would be going through the Internal Revenue Service to acquire tax-exempt status.

Phase one could take two to three months, according to estimates, while phase two could take one to two months and phase three could go from four to six months.

Mr. Gray said members of the committee he is forming need to be committed to the truth and accepting the final outcome of their work regardless of whether the results meet with their personal favor.

“We have a great hospital with a superior staff and a dedicated group of volunteers who serve on the MMH board. I am convinced that if we all come with open minds and put our heads together, we can find a workable scenario that guarantees Massena Memorial Hospital will continue providing top-quality care and great employment opportunities for many years to come,” Mr. Gray said.

The plan has the support of Town Councilman John F. Macaulay.

Mr. Macaulay, a Democrat, is the lone member of the board not up for election this year. Mr. Gray is a Republican.

“He’s got my support on this. The board has said all along that we need to have good communications on these things,” he said. “We’ve asked people to tone down the rhetoric, but that doesn’t seem to be helping. People seem to be making assertions. Joe wants to get everyone in the same room and talk about what changes needed to be made to keep it public or if it ends up going private, whichever way it goes. He’s got my total support.”

Mr. Gray challenged Mr. Spanburgh’s assertion that it might be premature to form the committee. “We should have a committee before we make a decision. If we’re interested in hearing from everyone, and keeping an open mind, I think the committee should come before the decision,” he said.

CSEA spokesman Mark Kotzin also expressed some concerns about the committee, noting the unions are being given only one representative each.

“We are quite concerned about equal representation on the committee,” he said, although he added that the union agrees the committee is a step in the right direction.

“Our overall goal is to work with the administration to save Massena Memorial and avoid giving up public ownership of the hospital,” he said.

Looking at a projected $15 million loss in reimbursements over the next 10 years and a directive by the state commissioner of health to explore options such as collaborating, affiliating, merging or sharing with other facilities, hospital CEO Charles F. Fahd II has said Massena Memorial Hospital has no choice but to investigate converting from a municipal hospital to a private, nonprofit facility.

He has said the facility’s options as a municipal hospital are limited, and it cannot absorb the projected losses it is projecting in the years ahead.

Mr. Fahd said that as a result of the federal Affordable Care Act, which took effect in April, the hospital expects to see a reduction of more than $10.5 million in Medicare reimbursement, or $1.05 million a year, over the next 10 years.

The hospital also is facing cuts of millions of dollars in Medicaid reimbursement over the next 10 years, he said.

State pension costs are another financial problem for the hospital.

The hospital’s contribution to the state’s pension program was $124,200 for approximately 350 employees in 2002. That skyrocketed to $3.8 million in 2012, and its contribution in December will be $4.4 million. Mr. Fahd said the state is projecting that the hospital’s December 2014 contribution for the more than 400 employees will be $4.8 million.

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