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Town may get financial relief related to sale of Massena Hospital

Posted 5/27/22

BY JEFF CHUDZINSKI North Country This Week MASSENA — The town of Massena may soon receive a new lifeline to sort out the remaining debts following the sale of Massena Hospital in January 2020. …

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Town may get financial relief related to sale of Massena Hospital

Posted

BY JEFF CHUDZINSKI
North Country This Week

MASSENA — The town of Massena may soon receive a new lifeline to sort out the remaining debts following the sale of Massena Hospital in January 2020.

Officials say a bill in the State Assembly and Senate may potentially assist in covering the costs of said liabilities through bonds that can be paid out over a number of years.

Town Attorney Eric Gustafson said that despite the efforts of the town in recent years to handle the situation, the town is not necessarily in a position to bond to cover the liabilities just yet.

“We’re not actually in a position where we’re ready to issue bonds to respect any of the potential liabilities in the hospital. But, pending before the Senate and the Assembly is a bill that would authorize the town of Massena to issue up to $5 million in bonds for a period of about 30 years,” he said.

Gustafson said the bills could be crucial to handling the situation with the hospital, while also freeing up the town to bond further if necessary.

Under the terms of the bill, the town of Massena would have an expanded borrowing limit under local finance law.

Town officials voted to authorize issuing bonds to cover pension contributions due to the hospital employees during the Board’s May 18 meeting.

Gustafson and town officials alike are hopeful bonding is not necessary to cover the trailing liabilities but stressed the town should be prepared for a “worst case scenario” should a bond be necessary.

“It’s something we hope we don’t have to use, but we don’t want to be caught flat-footed. It’s just good planning,” Gustafson said.

Massena Hospital, formerly Massena Memorial Hospital, was embroiled in controversy for a number of years due to poor financial circumstances and what some officials felt was mismanagement prior to its sale to St. Lawrence Health.

Prior to accepting an agreement for St. Lawrence Health to manage the facility, officials had sought to align with Crouse Health, through a management and operational deal with Claxton-Hepburn.

The decision was made in May 2019 to eventually align with St. Lawrence Health in a management and operations contract that saw St. Lawrence Health assume responsibility for the hospital’s day to day operations.

The New York State Department of Health had full oversight of the new alignment and in July 2019 agreed to issue a $20 million grant on behalf of St. Lawrence Health to purchase Massena Hospital, contingent upon the creation of a new, nonprofit organization to purchase Massena’s assets. At the time of the agreement, St. Lawrence Health also agreed to pay $8 million towards the purchase, with Massena Hospital in dire straights to even make payroll at the time.

The deal for SLH to purchase Massena Hospital was officially ratified by Massena Hospital’s board of Managers in Aug. 2019 and approved through a referendum vote on Nov. 5, 2019. The final tally was 1,963 to 174.

Full management and operational responsibilities were officially transferred from the town to SLH on Jan. 1, 2020.

Following the transfer to SLH, hospital officials claimed all services and staff would be retained, however officials closed the maternity unit on July 12, 2020 in what was deemed a “financial necessity” after years of financial losses.

At the time of the unit closing, 10 nurses were affected, all of whom could transfer to other jobs in the SLH system, officials said at the time.

Officials also approved closing the Massena Hospital clinic based in Brasher Falls as part of a Critical Access Hospital application.