Jackson Faces Major Financial Hurdles Operation Threatened

Written by Risa Polansky on June 26, 2008

By Risa Polansky
Ongoing and future funding constraints on Jackson Health System are threatening its 90-year open-door mission.

The health system needs to fill a $200 million gap in its budget this year. President and Chief Executive Officer Marvin O’Quinn believes it can be done.

But next year, he said it’s "highly unlikely." In 2010, he thinks it won’t happen. And by 2011 or 2012, short of changing the public hospital’s mission, "we won’t be able to make payroll," Mr. O’Quinn said.

Public hospitals nationwide face the same problems, he told Miami-Dade County commissioners this week: More uninsured patients, declining reimbursements and a souring economy.

"People say county hospitals can’t close. Well they can and they do," he said, pointing to DC General Hospital, Philadelphia General Hospital and others.

Without funding solutions, Jackson may have to refuse care or cut off programs down the line, Mr. O’Quinn said.

The hospital has trimmed already $200 million in recent years to stay afloat.

But "there comes a point in time where we’ve done everything we can do," he said.

County Manager George Burgess said the county can use the summer ahead "to try to be as creative as we can" to help Jackson before solidifying next year’s budget.

But "the issues for the hospital aren’t just issues for the upcoming year budget. The issues for the hospital are far more significant than that," he said. "The issues are the long-term sustainability of that public hospital and all that it does for our indigent in this community. That model has to change. And the cost-side of the budget has to be addressed, or I don’t think in the long term it’s viable or it works."

Mr. O’Quinn agreed.

Jackson faces "twin problems," he said. Revenue shortfalls and a dearth of money needed to make capital improvements to facilities.

Jackson will end this year with nearly $100 million in unmet capital needs, he said.

Paying patients are key to the health system’s survival, said Ernesto de la Fè, chair of the Public Health Trust, Jackson’s governing body. And up-to-date facilities are a key element in attracting paying customers to Jackson.

"Without them, the burden to our taxpayers would be significantly greater," he said.

Potential fixes to the capital funding issues could be another half-penny sales tax, a general obligation bond toward capital projects or creating a community redevelopment agency in the area surrounding Jackson, Mr. O’Quinn said.

The redevelopment district idea has raised eyebrows since surfacing earlier this month, but "it would help," he said. "Any level of capital would help because we can’t generate it internally."

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