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Massena Memorial Hospital board member shares concerns about bad debt write-off

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MASSENA — On a night when the Massena Memorial Hospital Board of Managers agreed to write off $637,387 in bad debt for April and May, one board member said he never envisioned the numbers would be so high.

Paul B. Morrow said the board once wrote off $20,000 to $30,000 per month, “and I used to have a fit.”

“Did we drop the ball or did we start being complacent and just don’t care if they paid when they left?” he asked.

The bad debt write-off approved Monday night brought the yearly total to $1,425,439.94. At the same time, the hospital reported recoveries of $278,970.25 year-to-date.

In other financial business, Chief Financial Officer James L. Smith said the hospital had a net loss of $713,075 in May, pushing the year-to-date total to $2,023,990.

“Discharges were down considerably,” Mr. Smith said, noting inpatient discharges, which had been budgeted at 209, finished 16 percent below budget, at 175, a 16 percent drop over the same time period in 2013.

Observation visits were up 3 percent over the same period in 2013, but were below budget. The hospital had budgeted 82 observation visits and finished the month at 69.

Outpatient registrations, however, finished ahead of budget by 3 percent, with 12,434 recorded for the month.

“Unfortunately, they were down in very key visits,” such as emergency room visits (14 percent below budget) and ambulatory surgical unit visits (31 percent below budget), he said.

The hospital finished May with $3.8 million in net patient revenue, 10.85 percent below budget, and other revenue came in at 45.55 percent below budget, at $169,582. That left a total operating revenue of $3.96 million. At the same time, however, the hospital had $4.7 million in operating expenses.

One of Mr. Morrow’s concerns was the bad debt situation, and he wondered how much the hospital had been collecting.

“Bad debts are actually going very well,” Mr. Smith said. “We’ve had a significant increase in our collections for the accounts that are prior to going bad debt.”

Mr. Morrow wondered if the hospital was “wasting time” trying to collect old bad debt.

“We’re not spending any time internally trying to collect that money. Collection agencies are spending their time collecting that money,” the CFO said.

Mr. Smith said the hospital also receives some money from indigent care pool distribution forms, which he said was formerly known as bad debt charity care pools.

“That money, it doesn’t make us whole. It doesn’t pay us dollar for dollar for our bad debts. But it does pay back to the hospital relatively significant portions of those bad debts,” he said.

Board member Loretta Perez wondered if the hospital was on top of its billing practices based on her personal experience.

“When my child was young and we had to bring her to the emergency room, our insurance at that time was $50. I swear to God, I have not seen bills for that emergency room visit,” she said.

During the public comment period Monday, Town Councilman John F. Macaulay wondered how much patients with no insurance were billed compared with those with insurance, and if offering discounts could prevent some of the bad debt write-off.

Mr. Fahd said those with no insurance are usually charged the highest rate by the hospital.

Mr. Smith said patients who are under 300 percent of the poverty level automatically receive a discount “that is comparable to our insurance rates.”

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