Uncertainty of federal, state cuts stymies hospitals, health care programs

For the region's hospitals and other health program providers, the word sequestration is sounding like a dreaded epidemic they're not going to be able to avoid.

Both Lawrence + Memorial Hospital in New London and The William W. Backus Hospital in Norwich would see a 2 percent reduction in anticipated annual reimbursements from Medicare if the automatic federal cuts take effect as scheduled Friday. For L+M, that would mean a $2 million reduction in its Medicare reimbursement of $100 million, and for Backus, a $1.7 million cut in its $85 million annual reimbursement.

But till Friday comes, the hospitals are holding out hope that Congress and the president will agree to stop the cuts, even as the chances of that appear increasingly slim.

"We're waiting just like everybody else," L+M spokesman Mike O'Farrell said Tuesday. "The issue is, this would be an annual thing, not just a one-time thing."

L+M "has no set plan" as yet for how it would address the cuts, he said. The hospital's administration has been more focused lately on a bigger looming budgetary threat - the $21 million it would lose if Gov. Dannel P. Malloy's proposed budget is enacted, O'Farrell said.

As part of a campaign against the governor's budget, Bill Stanley L+M vice president for development and community relations, handed out postcards Tuesday to employees and visitors in the hospital cafeteria to be signed and sent to local lawmakers. The postcard campaign comes three days after Stanley testified before the state legislature about the impact of the cuts.

The postcard begins: "I am writing to express my shock and outrage at the Malloy Administration's budget proposal ... I am urging you in the strongest possible terms as your constituent and as an L+M supporter to reject Gov. Malloy's devastating cuts and support our community hospital for the good of our region. I will be watching this issue carefully and will vote accordingly in the next election."

At Backus, the impact of Malloy's proposal also is overshadowing what sequestration could bring. Backus is fearing a $21 million cut over two years if the governor's budget is enacted, spokesman Shawn Mawhiney said.

"We continue to reduce costs throughout our system of care, but these cuts go well beyond efficiency and will require us to take a difficult look at every program and service, and how we provide them," he said. "This comes at a time when the health and hospital services in our regional community are needed now more than ever."

The Community Health Center, which has clinics in Groton, New London, and more than a dozen other communities across the state, would lose about $500,000 in federal grants that help support its primary care, dental and behavioral health programs, health center executive director Mark Masselli said. The uncertainty about exactly how the cuts would play out, however, makes it impossible to figure out in advance how to adjust accordingly, he added.

"It has me worried and anxious, but it's very hard to plan," he said.

He emphasized, however, that patients can be assured that the CHC still will provide the services they need.

"We encourage patients to continue to rely on us," he said.

Uncertainty about the cuts also poses a problem for the Thames Valley Council for Community Action, which relies on federal dollars for its Women, Infants and Children and Head Start programs in New London County, said Deborah Monahan, TVCCA executive director.

She said its WIC program, which supplies about 5,000 pregnant women, infants and children with nutritious food, and Head Start, which provides preschool education for 529 children, "could limp along through March" if the cuts take effect, but after that, the future is uncertain. The WIC program receives $600,000 annually from the federal government, and Head Start receives $3.7 million.

"We don't want to start panicking, and we don't have to start doing waiting lists yet for participants," she said, "but we have been very cautious in terms of our expenditures, and it's really difficult to do any long-range planning."

Other programs indirectly funded by federal dollars that first go to the state and then are distributed also could be impacted, she said.

"It's very, very daunting," she said.

j.benson@theday.com

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