N.H. Gov. Shaves $20 Million from Hospitals – Cites Exec. Salaries

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January 16, 2011; Source: Foster’s Daily Democrat | Democratic Governor John Lynch of New Hampshire is proposing to take $20 million out of the uncompensated care fund, which goes to the state’s nonprofit hospitals. He has said that the money will be redirected to help maintain Medicaid optional services which funds nursing services, prescription drugs for seniors, and wheelchairs among other things, but this means it is simply replacing an expenditure now being made by the state’s general fund.

His real rationale – beyond just reducing expenditures – seems to be encompassed in a statement he made about executive salaries. “Hospitals can afford this change. Hospitals get millions of dollars in tax breaks for being nonprofits. But according to their latest public filings, the top 200 executives of our 24 nonprofit hospitals made a collective $60 million."

Salaries at these hospitals became an issue last year when the attorney general expressed a concern about the $1.4 million in compensation being paid Alyson Pitman-Giles, the CEO of Catholic Memorial Hospital in Manchester. The governor has also expressed concern about overbuilding in the healthcare arena, not because it is requiring state contribution, but because the expansions and upgrades, in his opinion, are discretionary and will only drive insurance premium costs up even further.

While individual hospitals are still digesting the information, Steve Ahnen, the president of the New Hampshire Hospital Association responded, "The investments that have been made over the last several years and that are being planned in the future are designed to provide high quality, state-of-the-art health care to the patients and communities our hospitals serve, including upgrades to a number of our state's smaller, rural hospitals that had not been renovated for decades . . .The governor's call to place a moratorium on new hospital projects is unfortunate and not realistic as hospitals struggle to advance projects, such as information and clinical technology, which will improve patient care."

Lynch is a popular 4th-term Democratic governor in what was, until 1992, a traditionally Republican state. His wife is a pediatrician working at Concord Hospital.—Ruth McCambridge