Massena Memorial Hospital Heading Toward Bankruptcy, Consultants Say

Financial consultants have determined Massena (N.Y.) Memorial Hospital will continue to lose money and go bankrupt by 2017 under the status quo, according to a Watertown Daily Times report.

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.

More Articles on Hospital Finances:
Top 10 Risk Management Concerns for CFOs in 2014  
State Approves $3M Budgetary Loan for St. Bernard Parish Hospital  
12 Recent Notable Quotes From Hospital & Health System CFOs 

© Copyright ASC COMMUNICATIONS 2019. Interested in LINKING to or REPRINTING this content? View our policies by clicking here.

 

Top 40 Articles from the Past 6 Months