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Federal Fiscal Cliff Will Impact Claxton-Hepburn

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The federal fiscal cliff financial crisis has been averted with the arrival of the new year, yet Claxton-Hepburn Medical Center will soon feel its impact.

The Ogdensburg hospital won’t escape unscathed, but will also post some encouraging bottom lines thanks to some measures taken earlier in 2012.

“It is getting increasingly difficult to generate an operating profit to reinvest in the organization,” Mark Webster, Claxton-Hepburn’s president and chief executive officer said Wednesday in prepared statement. “We will continue to explore opportunities to improve efficiencies and continue to be good stewards of community resources.”

Mr. Webster’s cautious optimism, however, is set against a backdrop of some bleak numbers.

As part of the American Taxpayer Relief Act of 2012, Claxton-Hepburn is projected to lose $1,011,000 from Medicare between 2014 and 2022, according to Laura C. Shea, the hospital’s director of community relations and planning.

Also, she said, the reduction doesn’t include the expected $806,000 decrease in reimbursements this year as part of the federal Patient Protection and Affordable Care Act. The PPACA, which began in 2010, will take $18,465,000 from Claxton-Hepburn over the 10-year phase-in period.

Bracing fiscal predicaments, according to Mrs. Shea, prompted the hospital to react accordingly.

Last year, Mrs. Shea said, was financially challenging for Claxton-Hepburn Medical Center. Facing cuts from both the state and federal levels, the medical center addressed the decrease in reimbursement by implementing a profitability plan in June 2012, which included some employee layoffs, position eliminations and realignment of staff duties.

The hospital laid off eight workers in July and eliminated a total of nine positions in December, including six layoffs.

The profitability plan has focused on enhancing revenues and reducing expenses, and yielded a savings of $1.4 million last year.

Mrs. Shea said the hospital finished 2012 with surplus from operations of $1,758,131, which she called a “modest” 1.87 percent profit.

This year could also see the continuation of a positive trend.

The medical center, Mrs. Shea said, has been profitable from operations for four of the last five years and has budgeted a 2.06 percent profit for 2013.

Last year was busy for the hospital.

Claxton-Hepburn saw an increase in volume in its Emergency Department in 2012, caring for just over 19,000 patients, Mrs. Shea said. Also, the hospital’s health centers saw a decrease in business due to the loss of two providers. New providers will be added to the Hammond Health Center in March and to the Claxton-Hepburn Health Center in April.

Business volumes in outpatient departments such as wound healing, cancer services, and pain management saw strong growth in 2012, according to Mrs. Shea.

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