The release of Mayor Bill de Blasio administration's turnaround plan for the municipal hospital system on Tuesday morning raises a simple question, but one that won't be clear for several years: Will it work?
One key watchdog is skeptical.
The 56-page transformation plan that accompanied the mayor's executive budget focused on some initiatives that already are in place, such as enrolling more uninsured New Yorkers in MetroPlus, reducing personnel through attrition and making investments that improve access to outpatient services. But details remain vague.
In his budget, de Blasio filled NYC Health & Hospitals' operating deficit with an additional $160 million cash infusion on top of the $337 million the city had promised in January. But the city will have to do more if it hopes to plug a budget gap that is projected to total $1.8 billion in 2020.
The strategies presented in the turnaround plan underwhelmed Charles Brecher, research director for the Citizen's Budget Commission, a watchdog that has played a role in shining a light on the system's ill financial health.
He said the report differed little from the city's initial proposal to address the budget gap through cost savings and new revenue, mostly through government subsidies and some growth in enrollment in its insurance product, MetroPlus.
“I'm disappointed. It doesn't seem to have much specification beyond what has already been their plan,” said Brecher, who is professor emeritus of public and health administration at NYU Wagner. “Part of why they've had to pump in money during the last year is because that plan hasn't been working. There doesn't seem to be a whole lot of change or new specification of how they will alter it going forward.”
Dr. Herminia Palacio, deputy mayor for health and human services, told Crain's in an interview that the initiatives and cash infusions outlined in the report and the mayor's budget are crucial to putting the system on solid financial footing.
She said the system had to invest in changes that would improve access to health services while also cutting costs.
“One is central to our mission around quality and equity," she said, "and the other is very essential to our fiduciary responsibility to be good stewards of the taxpayers' dollars.”
The city plans to lobby for state action during the 2017 legislative session to mitigate the impact of declining funding for safety-net systems. Health & Hospitals projects that the funding will drop 36% to $1.4 billion by fiscal 2020.
The city paid Manatt Health $3 million to create the report, although the consulting firm's name did not appear on the final copy. The new report, however, was included to please labor advocates, a feat that certainly wasn't a given. At a rally earlier this month at City Hall, unions and elected officials laid down the parameters of an acceptable plan. They were firmly against any privatization of services or job cuts.
“We believe that the system is long overdue for the comprehensive retraining that is necessary to ease the transition of some facilities from hospitals to primary care, and expect to work closely with Health & Hospitals to ensure this happens smoothly and effectively,” said Henry Garrido, executive director of DC 37, which represents 18,000 workers, more than 40% of the health system's workforce.
Details in the plan, though, remain vague. Officials did not commit to a number by which it would shrink the workforce. The lack of specificity around labor changes or sources of new revenue troubled Brecher, who doubted whether the city would be able to close Health & Hospitals' budget gap.
“They're deferring some of the hard decisions about adjusting the scale of the operation,” he said. “The precedent so far has been for the city to backfill when the plan falls short.”