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Bad debt plagues rescue squad, Massena Hospital

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MASSENA — The Massena Volunteer Rescue Squad saw a dramatic decrease in its reimbursements last year, according to a member of the squad’s board of managers.

Rescue squad board member Roger M. Bennett told the Massena Town Council last week that reimbursements from insurance companies for 2012 amounted to only 37.53 percent of what was billed. That’s a significant decrease from 2011, when the rescue squad received 64.3 percent reimbursement for its emergency services.

“I know we won’t recover 100 percent, but they’re not paying like they used to pay,” Mr. Bennett said. “I’ve never had reimbursements this low.”

The decrease in revenue is a serious concern for the rescue squad, a volunteer service that relies on insurance reimbursements for funding. Mr. Bennett said the squad had budgeted for $450,000 in reimbursements last year, but ended up receiving $363,530. Noticing the sharp decrease, Mr. Bennett said, the squad curtailed spending. The squad underspent its 2012 budget of $449,000 by $83,000.

“When the funds were down, we backed off on buying equipment,” Mr. Bennett said. “I don’t think there’s anything we missed that was critical.”

Mr. Bennett said there typically is a three-month lag from the time the service is used and the date the insurance company pays, so more reimbursements from 2012 calls are expected.

The decline in reimbursements came during one of the rescue squad’s busiest years. The squad responded to 2,312 calls and provided 1,853 transports, an increase of about 60 percent since 2006, when the squad responded to 1,441 calls.

Mr. Bennett is afraid that if reimbursement rates don’t pick up, the squad might not be able to purchase essential equipment in years ahead. “It will impact our purchase of equipment, radios, mortgage payments, insurance,” he said. “All those bills have to be paid.”

The rescue squad isn’t the only organization suffering from low reimbursements.

A lack of reimbursements for medical service, otherwise known as “bad debt,” has long been an issue hurting the finances of Massena Memorial Hospital. In 2012, the hospital wrote off approximately $3.2 million of bad debt, during a year when the hospital generated a net loss of almost $2.4 million, according to Tina R. Corcoran, senior director of public relations and planning at the hospital.

If not for the bad debt, “we would have been $800,000 in the black,” Ms. Corcoran said.

The hospital has experienced annual bad debt of about $3.2 million for the past three years, more than what it used to be. In 2007, its bad debt was approximately $2.5 million, according to Sean M. Curtin, chief financial officer for the hospital. Bad debt comes from providing medical care to people who don’t have insurance or to people who have insurance but do not pay their copayments or deductibles.

Ms. Corcoran said bad debt is an issue facing hospitals across the region and the country.

“It’s hard,” she said. “We have to do more with less.”

She said hospitals have the responsibility to provide care to patients, regardless of whether they can pay.

“We still have to take of the people in our community,” she said. “It’s what we do.”

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