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February 26, 2009


As the Board knows, I expand my remarks at the February meeting to reflect on the general state of HHC, as well as the high-water marks we have reached and the challenges we have navigated during the past year. Of course, none of this happens in a vacuum — 2008, with the election of President Obama and the steady unraveling of our economy, was an astonishing and dramatic year — but the fundamental objectives of HHC remain tied to our immutable mission.

Our notable successes in the past year demonstrate that HHC is achieving national recognition as a leader in delivering on our mission-driven strategic initiatives around greater patient safety, clinical effectiveness and efficiency, and patient-centered care, even as we continue to provide the broad access to comprehensive primary and preventive care that improves the health of entire communities. And our challenges — in some instances, our failures — spoke just as clearly to the hard work required to remain true to our mission.

Since the continuing economic crisis frames so much of our current reality, I begin with the challenges. But I think you will agree that our accomplishments this past year remind us of how far we have come, and demonstrate the strength and resilience we derive from strong local leadership as well as an exceptionally committed and capable workforce.

Maintaining Quality Care in the Face of Economic Challenges

While the daily developments in city, state, and national budgets occupy a great deal of our current focus, it is important to note that, from HHC’s perspective, the fiscal rollercoaster began in early 2008. Last February, precipitated by the subprime mortgage crisis, the subsequent global credit crunch, and the downgrading of several bond insurance firms, the auction rate securities market failed, forcing HHC to finance $346 million in bonds.

HHC was able to quickly and skillfully navigate through this credit crisis, and by early September we successfully issued $269 million of fixed rate bonds and $189 million in variable rate demand obligations (VRDOs) backed by strong financial institutions, protecting our bond standing while at the same time securing $100 million of new money to finance ongoing capital projects for the next two to three years.

As part of this process, HHC has saved approximately $2.3 million of interest payment by issuing VRDOs rather than fixed rate bonds since inception. While initially problematically high, interest rates have settled to an extremely favorable level for HHC, and if the environment continues, future savings will even be greater.

In addition to its measured handling of credit matters, there was evidence throughout the year that our disciplined and conservative financial posture, whether established as a matter of astute practice or dictated by regulation, continues to protect HHC. For example, all of our institutional investments are safely placed in treasuries, and have never been exposed to fluctuating securities market conditions, or entrusted to fund managers.

Still, the financial picture is very much unsettled, and New York State is facing an unprecedented budget deficit, now projected at $54 billion over the next three years. Governor Paterson’s proposed budget for the next fiscal year would impose deep cuts to the State’s Medicaid program. Because HHC receives about 65% of its funding from the Medicaid program, we would be hit especially hard by these proposed cuts. We estimate that the proposed Executive Budget would reduce funding to HHC hospitals and nursing homes by nearly $300 million annually. These looming cuts come on top of the state Medicaid cuts already enacted earlier this fiscal year, local budget cuts to all City agencies – including HHC, and an escalating pension and benefits burden that is projected to add approximately $70 million to our annual budget.

The Governor has included a number of significant reforms in the proposed Executive Budget. HHC supports the proposals that will expand access to health coverage for the increasing numbers of New Yorkers without health insurance. However, there are other reform proposals that we support in principle but, as currently constructed, give us scant comfort. For example, one reform proposal would restructure Medicaid inpatient reimbursement (on the theory that those rates now exceed hospitals’ actual costs) to achieve both budget savings and a modest increase in ambulatory care rates. The current Medicaid reimbursement methodology is outdated and, by any calculation, reimburses outpatient services, including primary care, woefully below actual costs. However, whether inpatient reimbursement, in the aggregate, actually exceeds costs is questionable, as demonstrated by the state’s calculations for HHC.

While HHC hospitals account for a significant percentage of all Medicaid inpatient discharges in our City, we also operate a vast ambulatory care network that provides roughly five million outpatient visits annually. Nonetheless, according to the state’s calculations, its reimbursement reform would reduce HHC’s inpatient Medicaid reimbursement by $139 million, while increasing its outpatient reimbursement by $31 million, yielding a net loss of $108 million. It is counter-intuitive that HHC’s inpatient Medicaid reimbursement is actually in excess of our costs at this level of magnitude and our analysis of the state’s calculations reveal serious flaws and a misunderstanding of HHC’s cost structure. We have pointed these flaws out to the state and it remains to be seen whether those errors will be corrected to yield a more accurate and equitable result.

There is another element of the Governor’s reform agenda that we welcome: the creation of a new pool to support indigent care by teaching hospitals. Initial calculations suggest that HHC – having served nearly 450,000 uninsured patients last year – would benefit significantly from such a pool. However, because the new indigent care pool would come at the expense of graduate medical education funding, we doubt that it would be enacted. Moreover, even if the new indigent care pool were to be enacted as part of the proposed Executive Budget, HHC would still face a net additional loss of funding in excess of $100 million.

I say “additional loss of funding” because, on February 4, the Governor and legislative leaders reached agreement on a plan to close the State’s current fiscal year gap of $1.6 billion that includes a $25 million Medicaid cut to HHC. This brings the Medicaid cuts to HHC enacted this year to a total of $65 million, on top of new unfunded expenses in excess of $100 million (consisting primarily of collectively bargained salary increases and supplemental contributions to our pension fund required by the stock market tailspin.) Accordingly, the $65 million of already-enacted cuts will need to be addressed by a combination of efficiency initiatives and targeted service reductions. We are working hard to limit the service reductions under consideration and to ensure that patients who are reliant on the potentially affected services can be accommodated elsewhere within our system or through community resources with available capacity.

On the national front, the American Recovery and Reinvestment Act of 2009 (ARRA) was signed into law by President Obama on February 17. Members of the New York State Congressional Delegation, including Senator Charles Schumer, Congressmen Eliot Engel, Anthony Weiner and House Ways and Means Committee Chairman Charles Rangel, a conferee, were critical in advocating for the inclusion of many constructive health-related provisions in the federal stimulus package, as well as achieving a further moratorium on several dangerous federal regulations that would have reduced funding to HHC and other public hospitals dramatically. To them, we owe a debt of gratitude for their leadership.

The ARRA will bring about $87 billion dollars in increased federal Medicaid funding to the states over a 27 month period, retroactive to October 1, 2008, with New York State slated to receive $12.7 billion. New York State can effectively count on $5.2 billion (after deducting the share that will go directly to counties) for the coming state fiscal year 2009-2010. In contrast, the Governor’s proposed budget includes approximately $2 billion in state savings from cuts and taxes on hospitals, nursing homes, and home care. While the state clearly will receive more than ample new funding to hold HHC harmless from further Medicaid cuts, the state has discretion to use the federal funding for purposes unrelated to the Medicaid program and the outcome on further Medicaid cuts remains uncertain.

It is ironic that the proposed cuts to HHC’s funding will undermine the very services that our reform-minded Governor wishes to promote for more effective, safe, and efficient care: the extensive access that we provide to comprehensive primary and preventive care (including, for example, smoking cessation programs, routine HIV testing, cancer screenings, outpatient mental health services, child and adult immunizations, and promotion of breast feeding) and our more effective chronic disease management efforts that are demonstrably improving the health status of our patients with diabetes, hypertension and asthma. The proposed Executive Budget would cut HHC’s nursing homes by more than $44 million, at the same time as we are engaged in the culture change, quality improvement, and restructuring efforts that the State is promoting. The proposed cuts also would undermine HHC’s ability to meet the vast and growing numbers of uninsured patients that are now seeking its services – up 8% over the last year.

Negotiations between the Governor and the State Legislature on the balance of the Governor’s budget proposals will continue through March and we will continue to advocate against further cuts to HHC’s funding. However, I need to stress that any further cuts to HHC will most assuredly result in further service reductions.

Driving Cost Savings While Protecting Quality

Whatever may occur in the months to come, HHC recognized and began to prepare early for the consequences of shortfalls in the state’s and our other funding partners’ budgets. Late in 2008 we proactively initiated a freeze on all hiring, promotions and raises, except those salary increases to which we are committed under existing union contracts, and began strategic planning for deeper cost-containment. Other cost-cutting steps that we have already taken include severe restrictions on any out-of-state travel and non-essential expenses or purchases. To keep staff across HHC informed about these steps and to lay out the possible hard road ahead, I issued a video message in December and I will continue to speak to employees directly about the fiscal challenges we face.

Even as we struggle to make do with less, we are determined not to sacrifice the higher standard of quality and patient safety that we have achieved in recent years. Now, and in the coming months, our patients will need us and the care we provide more than ever. I know that maintaining our hard-earned gains will not be easy, but we will not allow this crisis to take us backward.

During the past three and one-half years, we have hired additional direct care staff across HHC, including more than 2,000 nurses and patient care technicians. In some instances, these new employees have replaced per diem or agency personnel who had not made a long-term commitment to our organization or our mission. As a result, while we are certainly not overstaffed, our current staffing level gives us some ability – at least in the near term — to cope with the attrition that will result from our current hiring freeze.

Against this uncertain financial landscape, the importance of our initiatives to further reduce expenses and improve efficiency is clearer than ever. Over the past few years, and with considerable success, HHC has aggressively undertaken multiple initiatives and projects to improve our supply-chain efficiency – ensuring that we procure and obtain high-quality products, in a timely way, at the lowest possible cost. Those efforts include achieving broad efficiencies in pharmaceutical procurement, resulting in pharmaceutical expenses remaining flat from FY 2007 to FY 2008, while others in the industry experienced double-digit inflation; engaging Cardinal Health as a Medical/Surgical product prime vendor/distributor, reducing our inventory to just-in-time levels and, as a result, dramatically reducing distribution expenses; optimizing pricing discounts by sourcing products through multiple Group Purchasing Organizations (GPOs) and using existing Federal, State, City, GPO, and regional contracts through our membership in various industry associations to mine for the lowest available pricing at any point in time; leveraging our purchasing volume and system size by adding that volume to other hospitals’ and health systems’ volume to achieve best tier pricing from major manufacturers; and developing market-share contracts with manufacturers and suppliers to achieve most-favored-nation discount pricing.

In 2008, we began another significant project in supply-chain transformation — the use of a new supply-chain information technology system throughout HHC that will be tied to our existing e-commerce and financial systems. This Web-based system will enable HHC to standardize procurement data enterprise-wide, to introduce an electronic item master catalog, and to make informed pricing, contracting, and product standardization decisions. The ability to standardize products across all HHC facilities will enable HHC to further reduce our supply expenses significantly.

A little more than a year ago we embarked on Breakthrough, a system of principles and tools based on a process improvement philosophy known widely as “Lean,” which was first developed in the manufacturing industry and more recently adapted for healthcare.

Through Breakthrough, we are training our staff in a performance improvement methodology and a framework for an organizational culture that systematically reduces waste and long-term costs, brings clinical services more efficiently and rapidly to the patient, and improves patient and staff satisfaction. With 10 facilities and our central corporate office actively engaged thus far, we have collectively conducted more than 85 Breakthrough improvement events in various venues and departments including emergency departments, operating suites, materials management and human resources. We saved $3.2 million in 2008 through our initial learning phase (with projected annualized on-going savings of $9 million) and found just under $2 million in new, recurring revenues. We expect far greater savings during the coming year as the number of discrete improvement events, as well as our mastery of the methodology, increase dramatically.

There is one more thing I want to mention, something that can be seen as a grace note in the financial dialogue of the past year. During the holidays, even as we all confronted our own new fiscal realities, nearly 50 HHC employees volunteered to participate in a special New York City and Daily News-supported Financial Help Line phone bank, counseling and encouraging New Yorkers who are struggling with unexpected or unfamiliar financial hardships, and helping them understand their healthcare options. It was, to me, a small but significant example of the way HHC staff cares about New York, and contributes to making life better in our city.

Changes in Leadership

We are fortunate to have strong support and guidance from a committed, knowledgeable, and engaged Board of Directors. While Charlynn Goins, our exceptional Board Chair for the past four years, stepped down in September, our new Chairman, Dr. Michael A. Stocker, brings extensive experience from various sectors of healthcare and has impressed us all with his energy, strategic insight, and quick grasp of HHC’s complexities.

Receiving National Recognition as a Leader in Public Health

This year we received the prestigious John M. Eisenberg Patient Safety and Quality Award from the National Quality Forum and The Joint Commission for our efforts in promoting unprecedented transparency around quality and patient safety. We have given the crystal award a permanent home on display in our Central Office Board room.

Late in the year, The Commonwealth Fund, the national private foundation that advocates for a high performance healthcare system, published a comprehensive case study about HHC that praised the improvement initiatives we have undertaken in recent years. The report noted that we were becoming a “provider of choice” and achieving higher levels of performance through our advanced use of clinical information systems, our work to improve chronic disease management, our collaborative team approach to identify and implement clinical best practices, our efforts to bolster our financial health, and our continued commitment to expand access and create a patient-centered healthcare system.

All four of our long-term care facilities were rated at or above the national average by the federal Centers for Medicare & Medicaid (CMS) under its recently launched rating system for nursing homes. Two of our facilities, Gouverneur Healthcare Services and Sea View Hospital Rehabilitation Center and Home, received the highest rating available – five stars – which was received by only 12% of the 15,800 nursing homes rated nationally.

Expanding Services for Staten Island Residents

In 2008, HHC continued to expand primary care services for low-income, uninsured residents of Staten Island. We have added adult primary care services to the Mariner’s Harbor Family Health Center and with final State approval, will add adult services to the Stapleton Family Health Center in March 2009. HHC has continued to provide significant financial support and technical assistance to the non-profit Community Health Center of Richmond. The Center’s volume has roughly tripled since opening in mid-2006, providing 18,800 visits in 2008, and we are funding renovations that will further expand its capacity.

For almost three years, HHC has supported the Staten Island Health Access Program (SIHA), a temporary initiative to expand access to primary care services for low-income patients through contractual arrangements with local community physicians, as more permanent solutions are put in place. Scheduled to expire on December 31, 2008, the SIHA program has been extended by three months to March 31, 2009, to ensure a smooth transition for all program participants to a new medical home. Program participants will have the option of choosing to receive care at the Mariners Harbor and Stapleton Family Health Centers, the Community Health Center of Richmond, and from a new state-of-the-art mobile medical unit. The unit is outfitted like any small doctor’s office, with two exam rooms, a waiting room, and computer connectivity for electronic medical records within the South Brooklyn/Staten Island Network. The mobile medical unit will deliver care at five locations across the Island, and is expected to accommodate roughly 4,000 primary care visits annually. Uninsured patients who use HHC’s Staten Island facilities will have access to affordable medications through their HHC providers.

Unquestionably, there is growing need for ambulatory care services in Staten Island, and HHC is committed to continue working with all Staten Island stakeholders to make additional investments, increase service capacity, and improve access. Among many planned service expansions, we are developing two larger ambulatory care sites in high-need areas; these sites are expected to be on line in 2012 and will provide primary and specialty care, as well as imaging and dental services.

Keeping our Patients Safe

As you know, it is our goal to make HHC one of the safest healthcare systems in the nation by the end of the year 2010. Last year we continued to make steady progress toward that goal.

During 2008, six of our hospitals piloted the use of surgical safety checklists in our operating rooms as recommended by the World Health Organization to foster better surgical team communication and reduce the risks of complications and death in surgery. Effective this month, HHC has now implemented the surgical safety checklist across all of its operating rooms and becomes the first hospital system in New York City, and among the first in the nation, to do so.

In 2008, we also began to implement the Colors of Safety program in our hospitals and long-term care facilities, which uses standardized color-coded wristbands to quickly communicate patients’ high-alert medical conditions and help prevent medication errors, allergic reactions, and falls. Nine of our facilities have now adopted the Colors of Safety and full implementation will be completed system-wide by the end of this year.

This past year we also continued our system-wide efforts to aggressively reduce hospital-acquired infections, achieving reductions in central line bloodstream infections and ventilator-associated pneumonia for the third straight year. From 2005 through 2008, we have achieved a 65 percent reduction in the rate of central line bloodstream infections and a 90 percent reduction in the rate of ventilator-associated pneumonia among adult patients in our intensive care units. Notably, Lincoln Hospital did not have a single central line infection in its medical Intensive Care Unit during the entire year.

In addition to progress in preventing hospital-acquired infections, the 2007 data posted on HHC’s web site show that our system-wide mortality rate continued to stay below relevant national benchmarks. Overall, the system-wide mortality rate for HHC hospitals decreased by 11 percent from 2003-2007, resulting in roughly 1,350 fewer patient deaths over that period of time. Our data for 2008, which will be posted to our website next month, reflects a further decrease in system-wide mortality compared to 2007.

Flu immunization of healthcare workers remains an integral part of our patient safety campaign, since it can prevent transmission of influenza to patients in fragile health. We offer, and actively promote, free flu vaccines to our staff at their facilities. Last year we raised our employees’ flu vaccination rate to 49%, well above the reported city-average for hospitals of 32%. This past year we set a goal of 60% for acute and ambulatory care facilities and 70% for long-term care facilities, and 8 of our facilities had met those goals by early January. Although the final numbers are not in, we expect to exceed last year’s vaccination rate.

Extending Transparency

We remain committed to sharing meaningful clinical data with the public because it builds trust with our communities, helps us to drive performance improvement, and strengthens our focus on our declared clinical priorities. And, from a business perspective, high performance and public accountability can only further our competitive position in the healthcare marketplace.

This year we will update and expand the HHC in Focus website to publish more performance indicators reflecting the quality of our patient care. The updated data will show further improvements in our system-wide mortality and hospital-acquired infection rates, as well demonstrate gains in the health status of the more than 50,000 diabetic patients in our care. By this summer, we will add new performance indicators on our website related to psychiatric, perinatal, and surgical care. Performance data on patient satisfaction and emergency department care will be published by the end of the year.

Joint Commission Surveyor Calls HHC a Model Healthcare System

In 2008, The Joint Commission conducted accreditation surveys of five of our hospitals – Bellevue, Harlem, North Central Bronx, Queens and Woodhull – and our long-term care facility at Coler-Goldwater. All achieved successful survey results and unconditional accreditation. Alan V. Funtanilla, The Joint Commission’s 2008 Survey Team Leader for HHC facilities, summarized our 2008 surveys by stating that “HHC was among … the best healthcare organizations reviewed by The Joint Commission.”

Coney Island Hospital, Kings County Hospital Center, Lincoln Medical and Mental Health Center and Sea View Hospital Rehabilitation Center & Home are scheduled to be surveyed in 2009.

Transforming and Reforming Behavioral Health

HHC provides more than one-third, of hospital-based inpatient and outpatient mental health services in this city. Because we run the majority of our City’s Comprehensive Psychiatric Emergency Programs (CPEPs), we also care for the majority of New Yorkers with the most serious and persistent mental illness.

Earlier this month, we opened the new 300,000 square foot behavioral health pavilion at Kings County Hospital Center, after completing its construction late last year on time and on budget. The new seven-story building features 230 private and semi-private inpatient beds, a new psychiatric emergency center with double the space of the previous one, and a wide range of outpatient and day treatment programs. This modern, efficient space is long overdue and allows us to consolidate services that were provided in seven antiquated buildings spread across the campus.

As the Board knows well, the neglect and death of Esmin Green on June 19 in the former CPEP located in the “G” building at Kings County was a tragic and reprehensible event that deeply affected staff throughout HHC. Immediate steps were taken to terminate responsible staff directly involved, as well as two senior managers with oversight responsibility. I appointed Dr. Ann Sullivan, one of our Network Senior Vice Presidents with a distinguished career as an exemplary director of psychiatric services, as the interim administrator to accelerate necessary program reforms as well as changes to front-line and supervisory staff.

The reforms underway are slowly yielding the desired results. Dramatic reductions in both the average length of stay and the average number of patients in the CPEP at any one time have been achieved over the course of the last year. New procedures ensure much closer monitoring of all patients during the entirety of their stay in the CPEP. More generous staffing ratios are enabling more expeditious and more effective screening, evaluation and treatment. New personnel known as “behavioral health associates” with training in de-escalation of aggression and crisis intervention have replaced uniformed security personnel in the CPEP, and peer counselors have been deployed across all three tours in the CPEP as a further resource for engaging patients in crisis constructively.

Earlier this month, following the retirement of Jean G. Leon, Antonio Martin assumed the role of Senior Vice President of the Central Brooklyn Network and Executive Director of Kings County. At the same time, Dr. Joseph Merlino took over as the hospital’s new Administrator of Behavioral Health Services. Mr. Martin and Dr. Merlino have shown themselves to be outstanding leaders during their tenure with HHC and they both have a solid track record of successfully driving culture change and organizational performance improvement in their previous positions. They will continue to lead the necessary reforms and improvements across the behavioral health program including, among other things, the further deployment of behavioral health associates and peer counselors to inpatient units, and the more effective management of chronic medical conditions, such as diabetes and hypertension, common among patients with mental illness.

Prevention, Screening, and Chronic Disease Management

To fundamentally improve the health of the communities we serve, we continue to promote broadly accessible and robust primary and preventive care. Our system-wide efforts to promote smoking cessation, cancer screening, and routine HIV testing have produced significant and measurable benefits for our patients.

Over the past three years, we helped more than 25,000 patients to quit smoking successfully. Research suggests that at least one-third of these patients, or about 8,000 former smokers, will avoid smoking-related disease and premature death as a result. We also continue to focus heavily on cancer screening, performing more than 90,000 mammograms and 165,000 cervical cancer screenings last year. We performed more than 20,000 colonoscopies during 2008, almost twice the number performed just five years before.

The incidence of diabetes in New York City has doubled over the past ten years and is still growing. HHC has more than 50,000 patients with diabetes who are receiving primary care at our facilities. The medical and financial implications of poorly controlled diabetes for these patients and their families are enormous. Diabetes is the leading cause of kidney failure and adult blindness, as well as amputation of extremities. It also is a major contributor to heart disease and stroke.

Our web-based electronic diabetes registry has been an effective tool in helping us to better manage the health of our diabetic patients and during 2008 we achieved improvements in the percentage of our diabetic patients with well-controlled blood sugar, blood pressure and cholesterol levels. In collaboration with our colleagues at the New York City Department of Health, we finalized treatment guidelines for hypertension and high cholesterol and began disseminating those guidelines to staff. By the end of 2008 we had started to deploy a newly developed electronic cardiovascular risk registry to assist with the more effective management of hypertension and high cholesterol in our non-diabetic patients. That new electronic registry is now fully implemented and in use.

HHC’s telemonitoring program, House Calls, is another promising approach to chronic disease management for some patients. The House Calls program, supported by our MetroPlusHealth health plan and staffed by nurse practitioners and other staff from our Health and Home Care Division, uses telehealth technology to remotely monitor the health status of diabetic patients while they are in their homes. Blood sugar levels of the large majority of patients supported through this program have improved significantly, and complementary telemonitoring of blood pressure is now being introduced. Begun in October 2006 with a small test group of patients, House Calls expanded its enrollment roster during 2008 to nearly 275 patients. Another 125 are expected to join by summer 2009.

New York remains the epicenter of the continuing HIV/AIDS epidemic. Among New Yorkers under 65, HIV is the third-leading cause of death. Alarmingly, an estimated 20,000 New Yorkers – nearly 1 of every 5 people living with HIV – do not know they are infected, and 1,000 New Yorkers each year first learn they have HIV when they are already sick with AIDS.

HHC continues to work to make rapid HIV testing a routine part of medical care. We tested more than 160,000 patients across inpatient, outpatient and emergency department settings during fiscal year 2008, a near three-fold increase from four years ago and a 20% increase from fiscal year 2007. Our testing efforts identified more than 1800 HIV positive patients in 2008. Most of those who tested positive were unaware of their HIV status and are now connected to potentially life-saving care at one of our Designated AIDS Centers.

Developmental Care and Breastfeeding

HHC’s 11 hospitals delivered more than 23,000 babies in 2008. We treat a disproportionate number of the City’s high-risk pregnancies and, last year, more than 5,000 babies required treatment in our neonatal intensive care units. In these units, we are reengineering the environment to minimize stress factors and maximize comfort and developmental support, evidence-based measures that have been shown to improve survivability and outcomes for fragile infants born very prematurely.

We continued our commitment to improving the health of the babies born in our facilities by promoting breastfeeding of newborns through educating expectant mothers about the health benefits of breastfeeding and actively supporting successful breastfeeding post-delivery. To encourage new mothers to breastfeed their babies, we discontinued the formerly routine practice of distributing free formula samples and formula marketing materials to all mothers, while still making formula available to mothers who cannot or who choose not to breastfeed.

Last year, more than 30% of infants across our system were exclusively breastfed at discharge, and nearly 80% of babies were breastfed at least part of the time before discharge from the hospital. In 2008 Harlem Hospital became the only hospital within New York City, and only the second in our State, to be certified as “Baby-Friendly” by the World Health Organization based upon its successful promotion of breastfeeding.

Palliative Care

While exhausting all clinical life-prolonging efforts may meet some patients’ wishes, it sometimes magnifies, rather than mitigates, the suffering and anguish of patients and their families. When death is foreseeable and near, palliative care — with its focus on reducing the severity of pain and other disease symptoms in the most humane way possible — offers the alternative of dignified, comfort care in the presence of family without the intrusion of futile, invasive treatment and technology.

Palliative care consultation teams offer physicians help with complex symptom management, on-site monitoring of symptom treatment responses, and coordination of nursing, rehabilitation, hospice, and homecare services. Studies – as well as our experience – demonstrate that palliative care programs generally improve patient symptoms, restore a sense of control and dignity to the patient, and mitigate the family anguish that so often accompanies end-of-life.

During Fiscal Year 2008, HHC invested approximately $3 million to develop palliative care programs for nine hospitals in the system as well as expanding existing programs at Bellevue and Coney Island Hospitals. Last year about 1,600 patients received palliative care services. This year we expect that number to increase as our palliative care services, supplemented by contracted home hospice services, mature further.

In 2008, Metropolitan Hospital announced the opening of its Pain Medicine and Palliative Care Center. In addition, the hospital received a $200,000 grant from the Fan Fox and Leslie Samuels Foundation to establish a Fellowship program to train doctors in palliative medicine, the first such program established in a public hospital in the nation.

Expanding Services to World Trade Center Victims

Last year, HHC’s World Trade Center (WTC) Environmental Health Center expanded from its hub site at Bellevue Hospital to two new locations: Gouverneur Healthcare Services in Lower Manhattan and Elmhurst Hospital Center in Queens. More than 3,000 individuals are under care for 9/11-related illness at these sites. Evaluation, comprehensive medical treatment, and most medications for 9/11-related illnesses are provided at no cost to those who qualify.

The Centers for Disease Control and Prevention (CDC) awarded HHC a three-year, $10 million per year grant to provide medical examinations, diagnostic testing, referral and treatment for residents, students, and others in the community that were directly affected by the dust and debris from 9/11. This is the first allocation of federal funds to support treatment of those adversely affected by the 9/11 attacks who were not rescue and recovery workers.

Last September, we began a marketing campaign to promote awareness of the WTC Environmental Health Center. The campaign, which featured ads in multiple languages, was developed in close conjunction with community members and 9/11 health advocates. As part of the campaign, 10 community-based and other organizations received $2.1 million in grants to conduct outreach to hard-to-reach groups, host educational forums, conduct health fairs, and provide patient navigation services to improve access to care.

Updating our Information Technology

Even as we thoughtfully plan for the next generation of electronic medical record technology, HHC’s previous investments in developing robust information systems that electronically retain and process critical patient medical data continue to position us as national leaders among all hospitals. In 2008, we used our strong IT foundation to build sophisticated functionality to enhance patient safety, support evidenced-based medicine, and ultimately improve patient outcomes.

Several key projects came to fruition, including completion of the design phase of a system-wide electronic platform that will improve blood utilization and the management of blood products used for transfusions. When fully implemented, the new system will replace 11 legacy databases, will offer significantly greater ability for quality checks, and will allow for a standardized process that supports safety as well as data collection.

In addition, an HHC-wide Deep Vein Thrombosis (DVT) Taskforce continued its efforts to improve safety around anticoagulation, designing decision-support tools that now guide clinicians toward safer medication dosing and monitoring. One such tool, now in use across the Corporation, alerts users when prerequisite blood tests have not been completed.

We have also taken steps to consolidate and protect the data we gather. All data centers throughout the Corporation will be consolidated into two Corporate Data Centers. This which will give us the opportunity to develop, implement and standardize policies, processes and procedures for operating an enterprise-wide IT environment and the opportunity for operational savings through consolidation of services, maintenance contracts and equipment.

This year, we also conducted the first major network upgrade in a decade, including the first ever redundant/backup network for Disaster Recovery complete with 24/7 monitoring of all network activity.

Network Reconfiguration

In 2008, HHC reconfigured two of our regional Networks, with Metropolitan Hospital Center shifting from Generations Plus to South Manhattan. The administrative reconfiguration brought Metropolitan Hospital Center into partnership with the two long-term care facilities under the South Manhattan Network – Coler-Goldwater and Gouverneur. This alignment opens up collaborative and referral opportunities that can further strengthen the rehabilitative services, palliative care, and geriatric programs at Metropolitan.

Capital Investments that Support Better Healthcare and New York City’s Economy

To ensure that HHC is positioned to meet the needs of the next generation of New Yorkers, we have continued our ambitious capital program. To date, we have systematically rebuilt much of our aging infrastructure, created therapeutic environments that better support the practice of modern medicine and enable the use of technology to realize better outcomes for our patients. Over the past three years, we have completed construction on major modernization projects totaling nearly $500 million on the campuses of six facilities. Over the next five years, we plan to complete projects that will help to advance our facilities’ ability to care for patients while contributing nearly $900 million to the New York City economy through construction contracts and employment.

In 2008, we invested in new equipment and upgrades to our facilities, including the new six-story cancer center at Elmhurst Hospital; Jacobi Medical Center’s new Ambulatory Care building; Lincoln Hospital’s Ambulatory Care Pavilion; Coney Island Hospital’s new Computer Tomography Suite; and Woodhull Hospital’s new digital mammography unit and fluoroscopy system.

In recognition of the special needs of seniors, we opened a comprehensive geriatric center at Metropolitan Hospital. Its outpatient center offers “one-stop” patient services with easy access to the onsite pharmacy and transportation services. Wheelchair accessible exam rooms have motorized tables and extra space to accommodate caregivers who often accompany elderly patients. Metropolitan projects the center will provide more than 16,000 outpatient visits this year.

Capital progress was achieved at two other important HHC facilities in 2008. The Harlem Hospital modernization project, which includes a new patient pavilion and the renovation of key nursing and clinical units in the Martin Luther King Pavilion, proceeded apace. And we held a groundbreaking ceremony at Gouverneur Healthcare Services for a four-year modernization project that will expand primary and preventive care services, transform the clinical and residential environments, and create a larger, modern, 295-bed nursing facility to serve the Lower East Side and Chinatown community.

Fulfilling our Mission in Times of Uncertainty

There is no doubt that we face difficult times. At the same time, in many ways we are a stronger organization then we have ever been. But if the economic crisis is prolonged and the budget woes of New York State and the City deepen, HHC, like every other public institution, will be profoundly affected.

The case study of HHC by the Commonwealth Fund noted that we have weathered financial difficulties in the past and that we “have achieved notable success in adapting to meet the challenges of its external environment, while also maintaining [a] core commitment to provide broad access to care without regard to patients’ ability to pay or their immigration status.” That vote of confidence is welcome, as is the Fund’s acknowledgment that we are transforming “our organizational culture, systems, and care processes to achieve essential attributes of a high-performing integrated delivery system.”

I remain confident that our positive transformation will continue and that we will demonstrate, by our example, that increasingly safe, effective and efficient healthcare is possible for all New Yorkers under a reformed healthcare system.

In this past year, our Board, our senior leaders across our system, our labor partners, our volunteers and auxiliaries, our community advisory boards, Mayor Bloomberg, and virtually all of New York’s elected officials have given HHC and its patients strong support. Such critical support will be more essential than ever as we strive to meet growing patient needs with scarcer resources and as we face the uncertainties of the coming year and beyond. As we meet these challenges together, I know that I can rely upon the Board for its wise counsel and thoughtful insight.

And I know that I speak for all of HHC’s dedicated men and women — those who work on the front lines of healthcare every day — when I say that in these times of growing need we will continue to do everything possible to ensure that we carry out our fundamental mission as our City’s healthcare safety net.