NNY hospitals say state aid will help reduce debt

North country hospitals say that millions of dollars awarded to them Friday by the state Department of Health will assist with paying off debt.

The funding is part of a $1.5 billion financial boost allocated through the state’s Capital Restructuring Financing Program and its Essential Health Care Provider Support Program.

Both programs were created by Gov. Andrew M. Cuomo to support the goals of the Delivery System Reform Incentive Payment program, which will reinvest $7.3 billion in Medicaid savings to New York’s hospitals and health care providers based on their ability to meet five-year goals.

Ogdensburg’s Claxton-Hepburn Medical Center received $14,376,607 — the largest grant awarded to a north country hospital.

President and CEO Nathan Howell said the state’s award will not only help the facility shore up its bottom line, but underscores the hospital’s irreplaceable role in the community and throughout the region.

In a press statement, he highlighted Claxton-Hepburn as a facility that provides access to “irreplaceable services” such as oncology, renal care, primary care, mental health services and wound care.

He said focusing on debt relief will allow the hospital to continue with current and future initiatives, including partnerships and collaborations with other health care organizations.

In 2006, Claxton-Hepburn was issued $20 million in bonds. Mr. Howell said $6 million has been paid back so far, leaving a balance of approximately $14 million. He said de-leveraging will help “ensure flexibility for careful and thoughtful reinvestment for the future.”

Furthermore, he said, the state grant is also proof that the hospital is continuing to make sound decisions that position it well for future sustainable growth.

“Through the application process, we had to prove our value to our community,” he said. “We demonstrated that value through our Sole Community Provider designation, serving the needs of a population that faces many health challenges, and trying to do those things that create opportunities for affiliations and collaborations with other organizations in the region.”

“We are very thankful for this award,” he said, “not only for the debt relief it provides, but also for the affirmation that we are doing the right things to create a sustainable model of health care for Ogdensburg and the surrounding areas.”

Also receiving funding in Jefferson County is Carthage Area Hospital, which was awarded $3,053,185.

CEO Richard A. Duvall said all of this money will be used to pay off debt.

“The monies awarded to use will eliminate the majority of the hospital’s long-term debt,” he said. “This is excellent news for us and will help increase cash flow for operations at the hospital.”

In September, Mr. Duvall told the Times that Carthage Area Hospital’s deficit stood at about $1.5 million, down from $7.6 million in 2011.

Claxton-Hepburn’s neighbor, Massena Memorial Hospital, received $5.8 million from the state.

Those funds will be used to help the hospital maintain a strong financial foundation as it transitions from a municipally-owned facility into a private, nonprofit one.

In Lowville, Lewis County General Hospital was awarded $6,580,000.

CEO Eric R. Burch said this represents about half of the $12 million the hospital applied for. He said the hospital plans to use the money to pay back $3.4 million it owes to the county.

He said the funds may also be used for future payments to the county, freeing up money for programs and other expenses.

“We do have a liability to the county, which we pay $100,000 a month,” he said. “Obviously that would provide us $1.2 million a year of additional cash flow.”

Finally, he said, money from the state may allow Lewis County General to pay off bonds, such as one issued to it for a new cooling and heating towers.

“I’m encouraged to see that all of the hospitals in the north country got a little help from the DOH,” Mr. Burch said. “We’ve been at the end of the food line for a while. It’s nice and I hope it’s a sign of things to come.”

By Eli Anderson, Watertown Daily Times