Rising labor costs and lost revenue under proposals to balance city and state budgets are projected to leave the system with a roughly $1.15 billion budget gap for the year that begins in July, Aviles said. Losses are projected to continue to grow in coming years to $1.51 billion in 2014. The estimated $1.51 billion deficit for 2014 does include any corrective action in the projection.
“We have no intention of passively watching this evolving budget crisis unfold,” he said.
State Medicaid cuts since 2006 have reduced the public system's funding by $240 million and New York's budget for the year that begins April 1 would reduce Medicaid revenue to the Health and Hospitals Corp. by another $70 million, Aviles said.
The system, which owns a dozen hospitals, is also bracing to lose another $300 million in local and federal subsidies for low-income patients, known as disproportionate-share payments, he said. Lost New York City funding will cut another $7.8 million for child health, HIV testing and developmental evaluation clinics, he said.
Ana Marengo, a spokeswoman for the 12-hospital system, said it's unclear how many jobs will be cut through layoffs and said the 2,600 figure could climb should the $300 million in proposed disproportionate-share payment cuts go through.
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