Paul Swibinski, spokesperson for BMC, called the situation "manageable."
"Everyone very surprised to learn that Bayonne Medical Center had an unexpected shortfall," he said.
Staff discovered the shortfall shortly after the departure of Robert Evans, who served as president and chief executive officer for BMC until last month. Evans has since taken up duties in the Cathedral Healthcare System in Newark.
"The operating deficit has raised concerns, partly because it was unexpected" Swibinski said. "But we believe this is a manageable situation."
Swibinski said the situation would not affect the purchase of St. Vincent's Hospital in Staten Island, which is expected to be finalized before the end of year.
Last week, Rep. Vito Fosselia, from Staten Island, asked for a disclosure of BMC finances in an effort to determine if the financial problems at BMC would affect the sale.
Swibinski said one situation has nothing to do with the other and the sale will be completed shortly.
Swibinski could not confirm or deny purchasing and other cutbacks staff claims are underway at BMC, but said it would be logical for the facility to seek to cut expenses in areas that do not affect patient care.
"We should have known about this revenue deficit earlier this year," Swibinski said. "It is caused by a 10 percent decline in patient volume."
In order to address the situation, BMC board must take aspects into consideration, how to fill the shortfall for 2006 and how to keep it from happening again in 2007.
"You have several options to fill the shortfall: cut expenses, increase revenues or sell property if you have real property to sell," he said. "In the '06 budget year, we have to come up with interim financing that will close the gap. But it is not a cause for any great concern."
On Dec. 12, Herman Brockman, chair of the BMC board of trustees, requested a $3.9 million advance payment on the balance of the state Charity Care funding for the state's fiscal year ending in June 2007.
"Bayonne Medical Center is finalizing a plan of restructuring in order to respond to a 10 percent drop in patient volume which as reduced patient revenue by more than $12 million annually," Brockman said in his letter to the state Department of Health and Human Services.
Swibinski said the state has agreed provided BMC provide a plan of action to alleviate the problem for 2007
"Going forward we need to develop a plan for 2007," Swibinski said.
Although the purchase of St. Vincent's Hospital has no connection to the operating budget of BMC, Swibinski said it has the long term effect of helping to reduce some of the operating costs in Bayonne.
"No money is going from Bayonne Medical Center for St. Vincent's and no money is coming from St. Vincent's to Bayonne Medical Center, but through various purchasing agreements there will be saving. But those will take time. You have to do some preliminary work before you get to those savings. It could take as long as six months."
Coalition and BMC are talking
Earlier this year, Bayonne residents, workers and doctors at the BMC, formed the Coalition to Save Bayonne Medical Center, raising questions about cutbacks and the purchase of St. Vincent's to determine if there was a connection and if there was a problem with management at BMC.
"There is no shock amongst Coalition members, just dismay and heavy hearts," said Mary Jane Desmond, spokesperson for the Coalition in response to the recent reports. "We are committed to our original goal of Saving Bayonne Medical Center. We continue to work with elected officials, state officials, community members and dedicated staff and representatives of BMC to save our facility now and see it grow to meet the healthcare needs of our community in the future."
Desmond said communication has improved between the BMC board and the coalition.
"In recent days through the office of Mayor (Joseph) Doria, there has been encouraging dialogue and commitment from both the Coalition and members of the Board of BMC," she said. "We will stay the course until a proper plan for reorganization is agreed upon and implemented which will address the financial and administrative disarray that has created fear and concern in both the Bayonne and Staten Island Communities. As the Mayor says, there is one thing that everyone does agree on, and it is our primary focus, that is, that Bayonne Medical Center must remain open to serve the needs of our community and to save jobs for 900 plus employees and their families."
Desmond believes some progress has been made.
"We believe we are on the right track, with much hard work still ahead," she said. "But, nothing can be accomplished without the honest, open dialogue and the genuine selfless commitment of all involved. We must all work to reestablish trust between the community and BMC as well as between BMC and its dedicated workforce and physicians. We believe we can get this done."