As senators worried about the effects of the governor's 14 percent cut in state aid for hospitals, Heather Howard, the state health chief, cited a recent report that found some New Jersey hospitals must close to improve the industry's financial woes.
"Unfortunately, because we have too many beds, some hospitals may need to close and when a hospital closes it may make other hospitals stronger in that area," Howard said during a Senate budget hearing.
Of the state's 78 hospitals, four hospitals closed in the last 18 months, four others announced plans to close and five filed for bankruptcy protection, with about half the others losing money. By comparison, the state had 112 hospitals 20 years ago.
"In some cases we may need to let market forces take effect, which may mean hospitals will close, and what our job is to make sure that we're saving the safety nets and preserving access," Howard said.
Corzine's proposed cut for hospitals is part of $2.7 billion in cuts to try to fix state finances plagued by deficits, high debt and taxes.
Much of the cut would come from money provided by the state to help treat the state's 1.5 million uninsured residents.
The New Jersey Hospital Association estimates the cuts would mean no state aid for 26 hospitals and less aid for 37.
"We fear the ultimate losers will be New Jersey's residents, many of whom will see more hospital closures, job cuts and service reductions in their communities," said Betsy Ryan, the association's chief operating officer.
Corzine's plan calls for $608 million in so-called charity care, but also calls for delivering the most aid to hospitals that treat the most uninsured residents. It also would create a special emergency fund to help struggling hospitals.
Sen. Kevin O'Toole, R-Essex, said the number of hospital closings in recent years is startling.
"I think it's unacceptable in this day and age that people are worried about where they go," he said.
Sen. Joseph Vitale, the Senate health committee chairman, worried the cut would increase health insurance costs and prompt more people to lose coverage.
Sen. Dana Redd feared "a statewide health care crisis" if urban hospitals close.
"Even in difficult times, we cannot turn our backs on the health care plight of the poor, and we cannot balance our budget on the backs of those people who are already struggling to make ends meet," said Redd, D-Camden, vowing to seek alternatives to health care cuts.
Corzine, speaking Wednesday on WOR radio, said he understands displeasure with his proposed cuts but argued he has no choice.
"We don't have the money," Corzine said. "If you don't have the money, you can't spend it."
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