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State funding cuts weigh heavily on AMC

SARANAC LAKE - Over the last 17 months, the Adirondack Medical Center in Saranac Lake has withstood repeated rounds of state budget cuts, resulting in a $649,000 impact to the hospital's bottom line.

According to AMC spokesman Joe Riccio, the hospital has endured these cuts in stride, managing to provide the same quality of care while avoiding cuts to programs and services.

One of the most substantial losses the hospital has faced is the gross receipt sales tax, also called the sick tax. Riccio said the state has siphoned $112,000 in revenue from AMC since April 2008.

"Gross receipt sales tax or the sick tax is basically a tax on every dollar of revenue that we earn at the hospital - a piece of that goes to the state," he said. "And in this case, since April 2008, that represents $112,000 worth of tax on our revenue that's gone to New York State."

Because of the cuts, AMC has been forced to pursue other avenues in relieving the impact of state budget cuts. Chandler Ralph is the hospital's president and chief executive officer.

"From this point forward, we must do everything we can to fight further cuts," she said in a prepared statement. "We cannot absorb any additional cuts."

Riccio explained that AMC - like most hospitals in New York - has a very thin operating margin.

"At the end of the year if we do have any excess revenue, it's used to reinvest in new equipment, new technology, staff training - all the things we do to continually do to improve the level and quality of care at AMC," he said. "So obviously, things like the sick tax that eat away at that small amount of excess revenue that we use to improve the situation, every little piece that we lose affects those positive gains that we like to make."

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