Public Reports and Testimonies

Remarks by Alan D. Aviles
President, NYC Health and Hospitals Corporation

Good evening, I am Alan Aviles, President of the New York City Health and Hospitals Corporation, our City’s public hospital and healthcare system. Thank you for being with us tonight. This is the first of our five annual public meetings for fiscal year 2014. As always, I am eager to hear what HHC’s communities have to say about our performance, especially during what continues to be a very challenging time in healthcare generally and for HHC specifically.

At the outset, let me recognize HHC’s senior executives here in Staten Island: Arthur Wagner, Senior Vice President of the South Brooklyn/Staten Island Network and Angelo Mascia, Executive Director of Sea View Hospital Rehabilitation Center and Home, our host this evening. My thanks to both of them and their talented staff for the stellar work they do every day serving Staten Island residents.

I also want to acknowledge the support and guidance of our Board of Directors, under the leadership of Dr. Michael Stocker, as well as the members of our Sea View Community Advisory Board and the Auxiliary, who advocate on behalf of our patients and our public system. We especially appreciate that our Community Advisory Board members help to keep us grounded and responsive to the needs of our patients and community. Finally, I want to thank our local elected officials for their continued support of HHC and its mission.

Hurricane Sandy

Last year, I spoke about the impact of Hurricane Sandy on the city and on HHC. As we all know, Staten Island was one of the boroughs most affected by the storm. A year later, there are people still displaced and some rebuilding and mitigation work will take years to complete. I’d like to thank the staff at Sea View for their work, during and after last year’s storm, at their own facility and for the time they spent staffing Special Medical Needs Shelters on Staten Island. In the aftermath of the storm, HHC deployed to Staten Island both of our mobile medical offices, which were open 12 hours a day and traveled throughout the borough for many weeks offering medical care to members of the community.

Across our public system, we have had to repair several damaged facilities, notably Coney Island Hospital, Bellevue, and Coler Specialty Hospital and Nursing Facility. Additionally, we have been working to make our at-risk facilities more resilient to minimize the impact of any future severe storm. These resiliency efforts will focus on protecting our facilities’ critical systems by elevating or hardening electrical switch gear, communications equipment, and fuel and water pumps. We must also create redundancies at these facilities to ensure continuity of operations, for example, by adding quick connections for external generators, boilers, and chillers.

The Challenges

As you would expect, the storm added an additional burden to the significant financial challenges we already face. These challenges will continue to intensify as we confront projected reductions in revenue and a daunting budget gap.

Medicaid cuts and reforms in the State’s budget will reduce HHC’s reimbursements from the state by more than $50 million this coming year. Over the past five years, HHC has absorbed cuts that now total an astonishing $540 million annually.

In addition, we will receive nearly $10 million less in our annual Medicare revenue going forward as a result of the federal sequester.

Yet even with these deep cuts, we are increasingly in an environment where we will be expected to deliver better care, with better patient outcomes, and to do so at lower cost. More and more of our funding will be tied to our ability to accomplish these three things.

While healthcare providers throughout the country are also dealing with these same expectations, the challenges for HHC are greater because we provide care for so many uninsured patients. For example, more than 70% of the adults we serve in our Staten Island-based primary care services are uninsured.

As you have heard before, HHC has worked hard to control costs internally. Over the past four years, we have implemented a cost containment and restructuring plan that, in the aggregate, has reduced our projected budget shortfalls by more than $1.7 billion since FY 2010. As part of that plan, by the start of this fiscal year on July 1st, HHC also had successfully met its workforce reduction target of 3700 full-time equivalent positions one full year ahead of schedule, which contributed to an annualized $600 million reduction to our budget gap. Most of this workforce reduction has not involved direct patient care positions and, to the credit of our dedicated employees, we have maintained virtually the same service capacity across virtually all care settings.

Going forward, our financial plan assumes another $193 million in savings in FY2014 based on our implementation of remaining restructuring initiatives as well as additional cost containment measures. These measures include efforts to consolidate targeted services, centralize procurement, improve revenue collection and maintain our lowered workforce headcount. These efforts, when fully implemented, aim to achieve savings of $390 million in FY15, $386 million in FY16, and $383 million in FY17.

HHC’s senior leadership team is committed to keeping our financial plan on track while continuing to provide high quality, safe care to our patients. Let me stress that we are looking at every conceivable way to close our budget gap without adversely affecting our capacity to serve the communities that depend on us, reducing access to care, or diminishing the stellar gains in safety and quality that we have made. That said, given the reductions in federal funding that started this year, it will be considerably harder to achieve these aims.

And under the Affordable Care Act, beginning in 2014 the federal government will make significant reductions in supplemental Medicaid and Medicare funding that supports public hospitals. These cuts increase dramatically by 2017 and ultimately could reduce HHC’s federal funding by more than $325 million annually. There is very little prospect of Congress re-visiting the wisdom of these looming, devastating cuts.

It is important for our communities to understand what we are up against, and why we have resorted to measures such as targeted layoffs, the closure of some small community clinics, and the outsourcing of certain services. And it is important that all stakeholders understand the severity of our financial challenges and the advocacy required to preserve HHC’s mission and to enable us to continue to meet community needs. While in the past we have relied on increases in governmental funding to keep our system solvent in the face of rising costs that were outside our control, the current economic conditions at all levels of government, the clamor for reducing healthcare costs, and gridlock in Washington, make additional significant government support unlikely for the foreseeable future.

Our willingness to make tough and, at times, painful decisions has enabled us to avoid closing any major HHC facility and allowed us to remain faithful to our core mission of serving all New Yorkers without regard to insurance or immigration status. However, the unrelenting financial pressure we are experiencing represents a grave threat to our mission and to our long-term ability to maintain sufficient service capacity to meet the needs of our patients across the City. And more tough decisions surely lie ahead.

Even as we struggle to make our system more efficient and to manage the formidable financial challenges we face, we continue to offer essential and high quality services to the communities that we serve. In our effort to promote wellness, we continue to strengthen the primary and preventive care services we provide, with an emphasis on the early detection of disease and the effective management of chronic diseases such as asthma, diabetes, and hypertension.

We are continuing to transform how we deliver care through our Patient Centered Medical Home, Health Home, and Accountable Care Organization efforts. Our health plan, MetroPlus, will play a key part in the success of all of these activities aimed at delivering better care, helping our patients become healthier, and at the same time reducing costs.

The investments we are making in information technology will have a significant impact on our success in these areas, as well. HHC has purchased a new electronic medical record system that will be phased in over the next five years. Our new system will enable our providers to share information more easily to better coordinate care, as well as give patients access to their health information, facilitating their ability to partner with their caregivers to improve their health status. By meeting certain objectives for using certified electronic medical record technology to improve patient care, HHC has qualified for meaningful use designation from the federal government that will result in the receipt of $122 million in federal dollars to help offset the cost of the new electronic medical record.

Additionally, we are completing installation of a new billing and appointment scheduling system. The new scheduling system will be more patient friendly and will enable us to ultimately consolidate multiple call centers.

As the Bloomberg administration draws to a close, I would like to thank the Mayor for the support he has shown for public health in New York City, and for our system in particular, over the last 12 years. We have prepared extensive transition materials for the incoming administration, and expect to begin briefings soon. Based upon his public statements during the campaign, Mayor-elect de Blasio certainly understands the critical importance of the public hospital system and we anticipate that he will continue the same strong support for its mission during these challenging times.

Our Work on Staten Island

Despite our financial challenges, we remain committed to strengthening the primary care infrastructure here on Staten Island.

Design documents for a $23 million state-of-the-art diagnostic and treatment center at 155 Vanderbilt Avenue are completed and construction will commence in the spring of 2014. We expect the center to be completed by 2015. The 21,000 square foot, three-story building will provide adult, pediatric, diagnostic and specialty care, as well as behavioral health services. I want to especially acknowledge City Council Member Rose and her colleagues for appropriating $7 million towards the Vanderbilt project – which will help to cover one third of the cost of the project.

Four years ago, HHC rolled out a Mobile Medical Office on Staten Island, which has been very successful. In the past year, the Mobile Medical Office accommodated nearly 500 patient visits; 84% of these patients were uninsured, and the majority of them were undocumented. A second mobile medical office opened in 2012, and it has been serving patients three days a week. This specially outfitted mobile unit offers ophthalmology and podiatric services, especially needed by patients with diabetes which is prevalent on Staten Island. More than 1,000 patients have received podiatry services over the past year, and ophthalmology services have been provided to 422 patients.

We also continue to make primary care services available at our two Family Health Centers, Mariners Harbor, and Stapleton. These health centers provided 5,600 visits last year. Additionally, there were a total of 3,521 referrals made, by all HHC primary care providers on Staten Island, to Coney Island Hospital for specialty care services.

Over the past year, HHC continued to provide breast cancer screening and diagnostic services using equipment at Sea View. Since the unit became fully operational, we have performed 801 mammography and 66 ultrasonography procedures for HHC’s Staten Island patients.

Even as we have developed greater primary care and preventive health capacity in the borough, HHC provided more than $11 million in start-up funding and operational support over the last seven years to the Community Health Center of Richmond, an independent federally qualified health center serving the North Shore. This transitional, temporary funding has provided the health center the foundation to secure state and federal funds for its ongoing operations.

On the long-term care front, we are especially proud of Sea View’s accomplishments. Sea View maintained its five-star rating from CMS. This rating is based on quality indicators, nursing staff levels, and prior State surveys. Sea View received five stars in each category, and the highest overall score ever awarded since this particular rating system began in 2008. Also, Sea View patients suffering from dementia are now part of a program introduced at HHC called Music and Memory. With donated iPods, staff set up personalized playlists for patients that often tap deep memories that can restore the capacity for interaction for some residents. The work is rooted in neuroscience research, and the results can be quite significant, including restoring the ability to converse and socialize.

HHC is also collaborating with Meals on Wheels on Staten Island. A 22,400 square-foot meal preparation and distribution center will be built on a 65,000 square-foot unused parcel of land at our Sea View facility. The new facility will house a full capacity kitchen for food preparation, storage, and administrative offices. Sea View provides a central location from which the entire borough may be accessed. In addition to an increase in demand over the past three years, as the elderly population of Staten Island continues to grow, Meals on Wheels will need this facility to meet the increasing need for its services.

We are also committed to collaborating with our colleagues at the Richmond University Medical Center and Staten Island University Hospital as they develop strategic plans to improve health care access for Staten Island residents. We have initiated discussions about ways we can collaborate on prevention and health promotion efforts, as well as opportunities to collaborate on cost containment activities in business operations, such as procurement or lab consolidation.

Conclusion

We appreciate that expanded primary care capacity for low-income residents is needed on Staten Island, especially on the North Shore, and we are committed to continuing our efforts to create more such capacity. At the same time, we are working hard on many fronts, as I’ve outlined, to make our entire system as efficient and effective as possible. And we are advocating strenuously at every level of government to fend off additional cuts that would undermine our ability to provide high quality services to patients and communities.

We appreciate the strong advocacy support that we continue to receive from our elected officials, partners in labor, community advisory boards and auxiliaries, and the many community-based organizations that care about our mission. Our strong connection to, and support from, the communities we serve continues to be one of our most important assets. Thank you all for your attention and for being here. I now will turn the program over to tonight’s moderator Mr. Russo. I look forward to hearing your comments.