Health and social service agencies, already faced with rising demand for services, now will be forced to cope with a 5 percent reduction in state funding for many programs.

Gov. Dannel P. Malloy announced Wednesday $170 million in spending reductions this fiscal year to help close a $365 million budget gap.

Because the announcement came halfway through the fiscal year, agencies must make adjustments quickly to keep their own budgets balanced.

"We are in line to take a hit of $482,000," Mike O'Farrell, spokesman for Lawrence & Memorial Hospital in New London, said Thursday. That amount, he said, is about 5 percent of the total state funding the hospital receives as reimbursement for uncovered services provided to low-income Medicaid patients and to HUSKY B patients, he said.

The governor has the statutory authority to rescind the current budget by up to 5 percent, but will need legislative approval for deeper cuts. The initial cuts will reduce the expected shortfall to about $162 million. The legislature is expected to meet for a special session in December to consider a plan for further reductions.

Like other recipients of state funds, L&M is awaiting details on how the reductions will be distributed to determine the exact impact, O'Farrell said.

The William W. Backus Hospital in Norwich also is beginning to assess the impact of the cuts, spokesman Shawn Mawhiney said.

Among the programs and services affected are agencies that provide home-care services. These include programs funded by the state Department of Social Services for home care for the elderly, disabled and chronically mentally ill.

Mary Lenzini, executive director of the Waterford-based Visiting Nurse Association of Southeastern Connecticut, said home nursing care keeps people out of nursing homes and other institutions. Cuts to these programs could mean fewer people receiving services, potentially forcing them into Medicaid-funded nursing homes, which in the end costs the state more.

"I don't see how that's saving money," Lenzini said. "The small amount of care we give helps keep them at home. It's very cost effective."

About 25 percent of the 3,000 clients using VNA annually receive some free or subsidized care, she said.

Hospice, personal care and home-care agencies also are slated for cuts, said Deborah Hoyt, president and chief executive officer of the Connecticut Association for Home Care & Hospice.

"We're not sure what the real numbers are yet, but this is pretty significant," said Hoyt, whose organization represents about 100 nonprofit and for-profit agencies. "Some home-care agencies will not be able to survive. This is a real threat, because there are more and more people in the community who need our help."

Together, the 100 agencies care for about 14,000 state residents per day and provide five million home-care visits annually.

"We're keeping 14,000 people per day out of the hospital," Hoyt said. "We are a cost-effective solution."

Cheryl Jacques, chief executive officer of the Southeastern Mental Health Authority in Norwich, said her agency and the private nonprofit agencies that it oversees are looking at whether there are any underutilized services that can be reduced or eliminated to absorb the cuts and have the least impact on clients. SMHA is part of the state Department of Mental Health and Addiction Services.

The nonprofits are being asked by the DMHAS commissioner to recommend how they will reduce their current budgets by 5 percent, Jacques said.

j.benson@theday.com