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MMH invites in two firms to continue exploring privatization

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MASSENA - As signs that read “It’s My MMH” begin popping up in yards around Massena, Massena Memorial Hospital officials are moving forward with a preliminary plans to see what would be involved in turning from a municipal hospital to a private, not for profit facility.

MMH Board of Managers Chairman Andrew Spanburgh told fellow board members Monday night that they’ve invited two firms to meet with the Executive Board on July 8. Each firm will have an hour to present their information on what they would need to do should they decide to move ahead with privatization.

CEO Charles F. Fahd II said several firms had expressed in an interest in assisting the hospital.

“Seven firms advised us they had the ability to assist us during this project,” he said.

“We whittled that down based on their letter,” Mr. Spanburgh said.

Tina R. Corcoran, senior director of public relations and planning for the hospital, said it was something the hospital had to explore as a way of containing costs. She noted that the hospital is the third largest employer in Massena behind Alcoa and the Massena Central School District, and they needed to determine what they could do to sustain the facility. They are also one of only two municipal hospitals in the state.

She noted in 2002 the hospital paid $149,000 into the state pension plan. In 2012 that number climbed to $3.8 million. Their bill this year was $4.4 million, and the projection for 2014 is $4.8 million. Becoming a private, not for profit facility would remove employees from the state pension system.

“If we go to a private, not for profit there is no New York state retirement,” she said.

A consultant would determine the hospital’s options in providing retirement benefits for its employees rather than the state pension plan should the hospital privatize.

But that’s only one piece of the problem, according to Ms. Corcoran. She said that 18 months ago hospital CEOs in Northern New York area suggested the only way they would survive would be to work together.

But, as a municipal hospital, Massena Memorial can’t do a joint venture and put potential tax dollars at risk, she said.

“As a municipal hospital we can’t do that,” she said. “The board evaluated what we can do to make it possible. We can’t cooperate with any other institution.”

For instance, she said, if Massena Memorial joined with another hospital to put a clinic in a town and shared the expenses, tax dollars would be at risk if that facility went belly up.

“We can’t jeopardize our tax dollars with somebody else’s. It could fall back on the taxpayers,” Ms. Corcoran said.

Mr. Spanburgh said that, following the Executive Board’s meeting with the two firms, the full board will have an opportunity to hear the information. There will also be an opportunity for the public to attend a meeting, one that board member Darrel Paquin suggested be at a larger venue such as the Massena Town Hall because of the anticipated size of the crowd.

But it’s still early in the process, according to Ms. Corcoran.

“No decisions have been made,” she said.

Not everybody is in favor of the potential move, though. The My MMH Community Coalition has been urging taxpayers via Facebook and a website to tell Massena Town Board members that “Massena Memorial is our community’s hospital” by sending letters to councilmen and signing a petition at https://www.change.org/petitions/keep-mmh-public. As of Monday night, the petition had 558 supporters.

Civil Service Employees Association spokesperson Mark M. Kotzin said previously that everyone should be concerned about the potential privatization of the hospital. He has been working with hospital employees who are members of the CSEA, which represents MMH employees who are not employed as nurses, “to build a community coalition against the potential privatization or sale of the hospital.”

“In a nutshell, right now this hospital belongs to every single taxpayer in the town of Massena. It’s their hospital. They have control over its destiny, control of the quality of care provided, control of what services are provided or not provided. The hospital really belongs to the community,” he has said.

Faced with possible revenue cuts of $2 million per year, Massena Memorial Hospital officials are beginning to explore turning the municipal hospital into a private, nonprofit corporation. Privatization could save the hospital the costs of paying into the state employees retirement fund.

If the hospital were to switch to a contributory pension system, such as a 401(k) plan, the amount an employee contributes to the plan would define his or her retirement benefits.

MMH officials have said they are considering all their options to compensate for a slew of federal cuts that may reduce the hospital’s revenue by approximately $15 million over the next 10 years.

Mr. Kotzin, however, has said that CSEA members have put forth idea-saving suggestions and were willing to work with hospital administration and management to come up with cost-saving ideas.

Town Supervisor Joseph D. Gray has also noted that, should the hospital no longer be financially viable, “the town taxpayers will be on the hook for the bill and we don’t want to go there.”

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