Budget Shortfall Looming for Public Hospitals in NYC

Over the next four years, the New York City Health and Hospitals public system could face a deficit of $6.1 billion according to recent projections from the New York City Independent Budget Office. This shortfall is expected in spite of the fact that the system – which runs 11 hospitals in the area – is slated to receive more than $2 billion in investments annually during this period, reports the TimesLedger.

The budget office’s report attributed the shortfall to a combination

of factors. To begin with, patients on Medicaid account for 45 percent of visits to NYC Health and Hospitals. An additional 25 percent of patients who visit the system are uninsured. In recent years the system has also seen a decline in inpatient care, and a rise in expensive outpatient care. These factors have all contributed to a significant rise in expenses for NYC Health and Hospitals. Mayor Bill de Blasio’s administration has developed a plan for internal reform in the system, but the budget office’s report found that it won’t be enough to offset the massive shortfall.

“Although the mayor has explicitly precluded closing entire hospitals, dismissing staff or privatizing services,” the report said, “H and H have already begun reducing staff through attrition and plans to further reduce personnel and other maintenance services by downsizing inpatient or other underused services.”

The report concluded by recommending that the system find ways to expand outpatient care to boost revenue and offset losses from underinsured patients. Part of the NYC Health and Hospitals “transformation plan” involves pushing for greater reimbursement from Medicaid and uninsured patients as well.

To avoid lapses in quality of care, NYC Health and Hospitals will have to act fast to institute comprehensive budget reforms. Otherwise, it could be patients who wind up suffering due to downsizing and personnel shortages.