MASSENA Even if pension costs go down over the next few years, as predicted by the state comptrollers office, Massena Memorial Hospital administrators say the relief wont be enough to stave off a gloomy financial future.
Those decreases will not be large enough or fast enough to reverse Massena Memorial Hospitals course if we maintain the status quo, said Tina R. Corcoran, senior director of public relations and strategic planning at the municipally owned hospital.
Matthew Sweeney, press secretary for the comptrollers office, said last week that employer contribution rates to the state pension system are expected to decline for 2015 and 2016.
Massena Memorial Hospital will pay $4.2 million this year, up from approximately $125,000 in 2002, Mrs. Corcoran said.
She said that even with a decrease of 0.8 percent in pension contributions in 2015, the hospital still will run out of money in 2017 if it maintains the status quo, as consultants from Freed Maxick Healthcare have suggested.
The hospital, which experienced years of escalating state pension costs, lost $3.3 million in 2013. Another sign of its continued struggles came Monday night, when Chief Financial Officer James L. Smith told the board of managers the hospital lost $840,839 from January to March of this year.
Its about $156,000 better than 2013, but not a glowing financial result for three months, he said.
Revenue was under budget because the hospital saw fewer patients than expected, he said.
The hospital board of managers hired the consulting firm last year to examine the financial implications of maintaining the hospitals status as a public entity or converting to another type of organization, such as a nonprofit. It predicted the hospital would be in the red by 2017 at its current pace.
Lloyd Arakelian, a certified public accountant with Freed Maxick Healthcare, recently said the hospital faces a projected loss in net income of $1.4 million in 2014, $1.2 million in 2015, $2.5 million in 2016, and it just gets worse as patient volumes decline.
In 2017 our money will be very scarce, Mrs. Corcoran said. We dont believe we can stake the outcome on the hopes that the pension contribution will drop to a level not seen in a decade in just a few years.
Although the hospital expects larger decreases in pension contributions in about 10 years, it needs those savings now to stay afloat, she said.
The hospital is not generating, and based on projections, will not generate enough revenue to cover its costs, including the pension costs. To remain open, the hospital must remain solvent. Revenues must match or exceed its costs. For the most part, the hospital does not control its revenues, so it must control its expenses, she said.
Hospital Chief Executive Officer Charles F. Fahd II spelled out the hospitals predicament during an April 10 public information session at Massena Town Hall, and Mrs. Corcoran said there will be more of those meetings in the weeks ahead.
Were reaching out to different community groups, she said.
Any group that would like to arrange for a presentation can call Mrs. Corcoran at 769-4305.