Belt-tightening in Washington is deepening Jackson Health Systems financial problems, reverberating not only through this fiscal year but next year as well.
The Senate's rejection last week of Federal Medical Assistance Percentages -- the method used for determining matching funds from the federal government -- means that Jackson won't get $50 million earmarked by the Florida Legislature and it could lose another $2.3 million a month, or about $27 million a year.
``This is going to be a challenge,'' said Chief Executive Eneida Roldan after the news was announced at the monthly Public Health Trust meeting Monday. ``We're calling together the senior team to decide what to do.''
The system was originally expected to lose $230 million this year, but between staff cuts and other measures, it had winnowed the expected loss to about $80 to $100 million. Jackson executives refused to predict what the news from Washington might do to that projection.
Ted Shaw, the interim chief financial officer, said the loss will hurt not only the bottom line, but also cash availability, the key measure for the hospital continuing to pay its bills.
Roldan refused to speculate about what the system might have to do to adjust to the cuts, which include another $4 million in lost state funding caused by a Crist veto.
In other developments at the Trust meeting:
• The board postponed giving $1.1 million to Jackson Memorial Foundation to administer the system's grants program after board member Judy Rosenbaum noted that the foundation had obtained only $427,000 in new grant funding in fiscal 2009.
``I think that's a lot of money,'' Rosenbaum said of the budget for the foundation. ``I don't know what they do for that.''
She noted that a handout indicated that the foundation managed more than $20 million in existing grants, but she wasn't certain how much work that required.
No one had an answer. The board decided to send the contract back to the fiscal committee for further study.
• With two dissenting votes, the board voted to close the obstetrics unit at Jackson South because it's projected to lose $2.57 million in fiscal 2010 and averages only eight patients daily. Roldan said those pregnant women would be welcome at Jackson Memorial.
Commissioner Javier Souto, a Trust member, objected to denying poor mothers the chance to give birth close to home. ``We're not here to make money. We're here to give service while trying to make ends meet,'' he said.
He warned the board: ``Maybe you don't know what you're getting into, but maybe you're getting into some ugly things.''
Trust member Abraham Galbut said Jackson had to make cuts ``unless the county commission wants to write us a much bigger check,'' something Souto didn't volunteer to support.
The obstetrics vote came at the beginning of a three-hour meeting. Near the end, Vice Chairman Angel Medina allowed two people to speak about why the unit should be left open. Obstetrician Ronald Sancetta said Jackson South had many reasons to attract patients, including a Cesarean section rate of 33 percent, which is quite low by Miami-Dade standards -- if Jackson had properly marketed the program.
After the meeting, Martha Baker, president of SEIU Local 1991, complained that ``No one has done anything to make it flourish.''
The Sibery Group, consultants hired by the local, raised two pages of questions about closing the OB unit, but Jackson officials didn't provide them with the information to complete their analysis.