OGDENSBURG, New York (WWNY) – Under the weight of so much debt, Claxton-Hepburn Medical Center in Ogdensburg has announced major changes.
Claxton-Hepburn will continue to run some of the hospital, but a majority of the services will be operated by Carthage Area Hospital.
The CEO of both hospitals Rich Duvall says Claxton-Hepburn couldn’t survive otherwise because it’s swimming in debt, and this option is more favorable than others that were on the table.
“Options such as restructuring, possible bankruptcy, possible cutting services,” said Duvall.
Those things are not happening as Claxton rolled out a new plan Tuesday.
“Carthage will run the acute care medical side of the facility, and Claxton-Hepburn will run the inpatient mental health and behavioral health services on the opposite side of the facility,” said Duvall.
He explains the revenue from the mental health facility and lease payments from Carthage Area Hospital to run the rest of the medical campus will help Claxton-Hepburn to pay its estimated $30 to $50 million debt.
Carthage will run things like the emergency department, the wound care facility and the Richard E. Winter Cancer Center.
“There are no service reductions slated or eliminations slated, and it will have minimal impact on the way we operate and deliver health care,” said Duvall.
There will be one change: the leased facility is planned to become a critical access hospital, which will get it a more favorable reimbursement rate from the government. In exchange, it cuts the number of acute beds at Claxton from 87 to 25.
“The reality is, looking at the data, since 2012 forward, our average daily census is between 25 and 30 patients, so converting to a critical access hospital, we’ll have 25 acute care beds, and we’ll have a 10-bed distinct part unit specifically for observation patients,” said Duvall.
As for the 500 to 600 jobs at Claxton, they stay. Duvall doesn’t anticipate layoffs.
Those in the mental health facility will stay with Claxton-Hepburn. All other employees will become workers of Carthage but remain in Ogdensburg. Duvall hopes the new plan is understood and supported by employees and the community.
“We are concerned and aware that some people may not support this type of change. But the reality is, it’s the best way to preserve services, and stabilize the financial condition, and protect the employees and their pension plan,” said Duvall.
A bulk of Claxton-Hepburn’s debt is related to pension costs estimated to be $30 to $35 million. Duvall believes this new plan is the best for retirees, current employees and the community.
“It was clear that our mission was to preserve as many services as we can, as many jobs, and do the best we can to make sure that pension is protected for those folks who have been committed to our organization for years,” said Duvall.
Claxton’s debt also was created by faulty billing practices, Duvall says, costing millions each year. That came to a head last June when the hospital laid off 41 people and outsourced its billing department.
Duvall says the state needs to approve this plan, but things look good for that to happen.
What will the new medical campus run by Carthage be called? Duvall says town hall meetings will be held soon to have the community and the employees have a say on the new name.
The changes are expected to be made in the next few months.
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