Hospital execs strike urgent note on alternatives to Medicaid expansion
by Ted Carter
Published: March 15,2013
The Mississippi Legislature is set to adjourn April 7 with no deal in sight on a federal offer to expand Medicaid.
The ticking clock has executives of hospitals around the state worried that time will expire and hospitals and the entire health care sector will suffer the consequences, putting about 9,000 jobs at risk.
Ahead are “devastating” cuts in the federal money hospitals receive for treating the uninsured if the state does not come up with “some offsetting solutions” to which federal officials can agree, said Chris Anderson, CEO of Singing River Health System and main speaker at a Mississippi Hospital Association press conference last Monday.
Part of the solution Anderson and his fellow health care executives want would maintain about $152 million in Disproportionate Share Hospital, or DSH, payments from the federal government scheduled to be eliminated with implementation of the Affordable Care Act provision for expanding Medicaid to the state’s working poor.
The other part of the solution would involve accommodating the flat refusal of Gov. Phil Bryant, Lt. Gov. Tate Reeves and the Republican leadership of both houses of the Legislature to take Washington up on an offer to cover the full cost of expanding Medicaid to the state’s working poor. Full funding of the expansion would occur for three years and be reduced in annual increments until the percentage of the federal expansion funded would level off to 90 percent by 2020.
Medicaid, which covers about 700,000 Mississippians, is today limited to very low-income women and children and low-income disabled seniors. Under the Affordable Care Act, an additional 300,000 or so of the state’s uninsured with incomes within 138 percent of the federal poverty level would be added to Medicaid rolls. The expansion would take in individuals making up to $9,000 annually and households with total incomes of about $14,000.
Going forward, hospital executives should assume Bryant and others will not have a change of mind on growing Medicaid, Anderson said. “The governor is not going to support Medicaid expansion – that is going to be a dead-end.”
The solution then, is to agree on an approach that preserves the money for treating the uninsured and expands health care to more uninsured, he added.
“I know that we cannot solve it if we don’t get in a room with a lot of smart people and talk,” Anderson said.
Discussions could include plans proposed by the governors of other states such as Florida and Arkansas.
Florida Gov. Rick Scott is trying to persuade the Legislature to accept a plan that would allow private health management organizations to treat new patients added to Medicaid. Further, Scott persuaded the Department of Health and Human Services to let the state back out of its Medicaid expansion commitment after three years.
In Arkansas, Gov. Mike Beebe has gained a tentative nod from Washington to allow the Medicaid expansion money to be used by eligible uninsured Arkansans to buy private health insurance on the state’s health care exchange. Analysts say the Arkansas plan could be more costly than Medicaid expansion and end up covering fewer of that state’s uninsured.
Anderson said he was encouraged by a joint statement from Bryant and Mississippi Hospital Association chair Claude Harbarger in which they pledged to seek a solution satisfactory to the various interests involved.
Bryant’s comments noted his opposition to expanding Medicaid, but emphasized: “I recognize the situation facing our hospitals and my administration is committed to helping to resolve those issues.”
Harbarger noted a fight against time is underway. “We must arrive at solutions in this calendar year or face significant reductions in health care services in the state of Mississippi,” he said.
Anderson’s press conference comments detailed the challenges facing Singing River Health System, which includes clinics in the coastal Mississippi region as well as Ocean Springs Hospital and Signing River Hospital in Pascagoula. Noting his challenges appear similar to hospital systems of like size throughout Mississippi, he said the Singing River Health System has laid off a couple hundred workers in the past two years in addition to cut backs in employee benefits.
Singing River Health System expects to lose $11.7 million in federal dollars by 2016 and up to $30 million in the years that follow. A portion of the $11.7 million is in federal Medicare reimbursements that Obamacare eliminates regardless of what occurs with federal money to cover hospitals’ costs for treating the indigent and uninsured, Anderson explained.
“Some of the reductions have taken place and will accelerate in coming years,” he said.
Ultimately, the “size of the fund cut is so large it is going to have a large impact on how we provide care in our communities,” he said, though he noted that cuts so far have not led to diminished services.
“I contend that 9,000 jobs in our state are at risk,” the CEO said.
Bryant, meanwhile, says Mississippi will sue the Obama administration if it withdraws the $152 million in annual payments that go to offset the cost of treating the uninsured in the state. He said he will rest his claim on the U.S. Supreme Court’s prohibition against the federal government taking punitive actions to force states into expanding Medicaid.
However, the Supreme Court did not directly address the portion of the law that specified replacing Disproportionate Share Hospital payments with Medicaid expansion dollars.
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