Budget cuts from Albany combined with the recession will likely translate to a lean 2009 for Cobleskill Regional Hospital.
But President and CEO Eric Stein is confident that prudent money management will carry the hospital through without reducing services to patients.
Released earlier this month, Governor David Paterson’s proposed cuts would reduce payments to hospitals statewide by $1 billion and reinstate a gross receipts tax.
Mr. Stein’s not sure how those numbers will affect CRH, but it’s not good. In past cuts proposed by governors, the legislature has managed to restore some if not all of the proposed reductions.
“There will probably some restored this year, but no where near as much as in the past,” Mr. Stein said.
The hospital’s board of directors approved CRH’s 2009 budget the day before Governor Paterson released his proposals. Because of the timing, Mr. Stein is unsure how the two will mesh.
Without the Governor’s cuts figured in, the budget projects a small increase in revenue.
“It’s a very conservative budget,” Mr. Stein said. “The challenge will be how the Governor’s budget affects it.”
Another looming unknown is a hospital budget line for bad debt and charity, or care that patients can’t pay for. The hospital budgeted $2.3 million for those items in 2009.
With a recession crippling the economy, Mr. Stein believes there may be more charity patients next year.
The recession may force more patients onto Medicaid, and the Governor’s plan to cut Medicaid payments to hospitals may pinch CRH, Mr. Stein said.
“Medicaid-eligible people will probably increase,” he said. “It does complicate things for us.”
Mr. Stein supports the Governor’s budget cuts in theory but said health care and education are shouldering too much of the burden.
“Health care is willing and able to help address New York’s budget crisis,” he said, “but a disproportionate amount is falling on education and health care.
“The only industry that’s hiring is health care. From an economic standpoint, you don’t want to mess that up.”
Help in offsetting the proposed cuts may come from Washington. The federal economic stimulus package may provide more dollars for Medicaid, Mr. Stein said.
“It would soften the blow but not compensate” for all of the planned cuts, he said.
In response to the cuts, the hospital may defer projects scheduled for early 2009, put some on hold and may trim costs on others, Mr. Stein said.
There will be no hiring freeze, “but we’ll scrutinize every position,” Mr. Stein said. “We already run a pretty lean operation here.”
Most importantly, there will be no changes in services to the public “and we hope it never comes to that,” he added.
Financial problems in 2009 may be difficult but not insurmountable, Mr. Stein said.
“The sky is not falling,” he reassured. “It’s cloudy and gloomy, but we’ll do everything we can to maintain this community resource. I’m sure we can pull it off.”