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Paterson budget seeks to cut $46M from LI hospitals

Long Island hospitals stand to take a $46-million hit if the governor's proposed budget is approved by the legislature, with the North Shore-LIJ Health System feeling the most pain.

When Gov. David A. Paterson first proposed the 2010-11 budget last month, the impact to the Island's 24 hospitals added up to about $40 million. But the governor, under pressure to close a more than $8-billion budget deficit, has since added amendments that raise that total to $45.8 million, according to Kevin Dahill, chief executive of the Nassau-Suffolk Hospital Council.

Under the governor's proposal, hospitals would pay an additional $20 million in taxes on their gross revenue, get $23 million less in Medicaid reimbursements and take an additional $3 million in miscellaneous cuts.

The North Shore-LIJ Health System's hospitals on Long Island would lose $19 million - including $10 million at North Shore University Hospital in Manhasset alone.

When other North Shore institutions off of Long Island are considered, the system would lose about $40 million, said its chief executive Michael Dowling.

While bemoaning the proposed reductions, both Dahill and Dowling acknowledged that with a state budget deficit of $7.4 billion, hospitals are likely to incur some losses.

"Once again, health care is taking it on the chin," Dahill said. But, he said, "we're not going to be so unreasonable as to say we won't have to feel some of the pain."

Dowling said the health system, which is large enough not to be dependent on one source of revenue and is able to move people and consolidate programs, would look for ways to be more efficient without having to lay off employees.

"We're in the midst of a classic predicament," Dowling said. "The state is in a bad situation and the hospital business in many places is struggling."

Both men said they were hoping to sit down with legislators to come up with alternatives. "We're just going to have to work through it," Dahill said.

State Sen. Thomas Duane (D-Manhattan), head of the Senate health committee, said he plans "to make a strong pitch" to use some of about $1 billion in federal Medicaid stimulus money for health care - a move also favored by State Sen. Kemp Hannon (R-Garden City).

That money is now being used by the governor to plug the deficit. "I'm going to make a strong argument that that money is more valuable for health care," Duane said.

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