FreedMaxick Healthcare has been working with the hospital to assess the fiscal impact of a few options, including maintaining the status quo and converting from a municipally owned hospital to a nonprofit organization, according to the report.
Certified public accountant Alan Gracie, a director with FreedMaxick Healthcare, has determined the nonprofit scenario would be best for the hospital, which would have a small operations loss in 2018 but $6.6 million in cash and equivalents on hand if it converted. Otherwise, Massena Memorial Hospital CEO Charles Fahd has said the facility would either have to cut $4 million from its budget annually to survive or tax the town of Massena to fund the deficit. He has dismissed taxing the community as a viable option, according to the report.
The hospital faces numerous financial pressures, according to Mr. Fahd. He has cited looming losses over the next decade, including a $10.5 million reduction in Medicaid reimbursement under the Patient Protection and Affordable Care Act, a $2.7 million Medicaid pay cut due to inpatient coding adjustments and an additional $1.9 million Medicare reimbursement reduction because of sequestration.
The New York State Department of Health has encouraged Massena Memorial to transition to private, nonprofit status. Last year, the hospital launched a privatization study because of concerns about costs and its inability to share services with other healthcare providers because of Massena Memorial’s municipal status.
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