BILL FARRELL
Observer-Dispatch

An already weakened health care system in New York state is likely to need life support if Gov. George Pataki's proposed budget is enacted, health care officials say.

The governor has proposed a zero-growth, $90.8 billion budget plan that would sharply cut state aid to education and health care, among other things. Pataki has said the state is facing a potential $11.5 billion revenue shortfall, mainly due to the economy and the aftermath of Sept. 11, 2001, terrorist attacks.

State legislators have agreed to restore $1.9 billion to the budget, targeting health care, K-12 education and higher education, but have not settled on how the money will be divided. Those three areas stand to lose roughly $3 billion total under the governor's budget.

This is also the 19th straight year that New York lawmakers have failed to adopt a budget by the April 1 start of the fiscal year.

Meanwhile, health care workers, such as educators and librarians, are not only complaining but warning of dire consequences from potential cuts.

Besides rallying last month in Albany and meeting with their local elected representatives, they've taken their concerns to the airwaves. A TV commercial appearing statewide shows a woman running with her child to the hospital emergency room only to find the doors closed.

"We're telling Albany (through the ad) to make the better choice: raise taxes on the wealthiest New Yorkers and corporations," said Debra Pucci, director of the Healthcare Education Project, a collaboration among healthcare unions and the Greater New York Hospital Associations.

The proposed Pataki budget would force hospitals to cut some 15,600 jobs, "having a $1.5 billion economic impact and causing the loss of $100 million in combined state and local personal income taxes and sales taxes," according to a new study by Healthcare Association of New York State.

Local hospitals themselves are speaking up.

"The health care industry has been enduring pain from both state and federal budget cuts since the late 1990s, and the (governor's) proposed budget will make continued operations, as our community has known us, very difficult or impossible," said Sister Rose Vincent Gleason, president and chief executive officer of St. Elizabeth Medical Center in Utica.

Pataki's budget would add nearly $881,000 in new cuts and taxes for St. Elizabeth, on top of $939,823 in old cuts, hospital officials say. Add that to a projected $616,554 in federal Medicare cuts, and the overall decrease in revenue is more than $2.4 million.

Officials say that just the close to $881,000 in cuts would force St. Elizabeth to consider, among other things, reducing its Family Practice Residency Program from training 25 physicians per year to 18, and delaying or possibly eliminating the expansion of community medicine locations to other areas that are not currently served by physicians or health care services.

"There will be a negative impact on all our hospitals and nursing homes throughout the region," Assemblywoman RoAnn Destito, D-Rome, said.

However, she said budget cuts will hit St. Elizabeth hardest because of its high number of Medicaid cases and high expenses for charity care.

Destito said restoring funds to health care is a priority, but the health spending and Medicaid systems do need reform.

"We aren't restoring all of the cuts," she said. "By no means are we able to do that. We want to just mitigate the ones that are most egregious."

Rome Memorial Hospital and its skilled nursing facility are facing $1.5 million in proposed cuts and new taxes under the governor's budget, said President and CEO Darlene Burns.

"We have been able to keep our overall non-salary expenses almost flat by standardizing products and taking advantage of bulk purchasing discounts. However, many of the cost pressures are beyond our control," Burns said.

"If these cuts are implemented, our community may lose needed services that we can no longer afford to provide."

Burns said payment shortfalls from Medicare and Medicaid make it difficult for the hospital to meet current challenges.

Medicaid payments for an emergency department visit have not been increased since 1991, she said. The hospital receives $95 from Medicaid regardless of the cost of providing care.

"A single dose of a clot-busting drug to save the life of a heart attack victim costs the hospital more than $2,200," Burns said. "Patients do not receive a bill for the difference, so hospitals have to absorb the loss."

Nursing homes are not immune from the proposed cuts.

Ralph Reid, chief executive officer at Mohawk Valley Nursing Home in Ilion, said the governor's budget would cut $550,000 in Medicaid payments. The nursing home took a 15 percent to 20 percent cut in Medicare in October.

If the state budget goes through as is, "we'd have to cut back on some of the programs that we receive no reimbursement for, like social day care and child care," Reid said. There would also be staff cutbacks.

"We've been contacting and working with our representatives (in Albany) asking for some kind of relief," he said.

Faxton-St. Luke's Healthcare is in the midst of an approximately $16 million consolidation of programs and services.

That venture will result in one acute care, inpatient facility at the St. Luke's campus in New Hartford, one primarily outpatient facility at the Faxton campus in Utica, and one long-term care facility at St. Luke's Home on the St. Luke's campus.

The consolidation was undertaken with the knowledge that resources in the health care system would continue to shrink, said Keith Fenstemacher, president and CEO over both campuses.

"We also knew that federal and state budget requirements were going to cause cutbacks and shrinkages in the reimbursements formulas to pay us in caring for the patients," he said.

Scott Pella, executive vice president and CEO at both facilities, said that "our best guess" for cuts under the Pataki budget is $2.4 million and another $300,000 in cuts at the St. Luke's Home.