Possible Medicaid cuts worry hospitals

Hospitals are urging residents to contact their legislators to ask them to oppose the bill.

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Two hospitals in Southeast Washington are among 38 rural hospitals in the state facing significant cuts to their revenue resources if the Legislature moves ahead with a bill that would eliminate the Medicaid Critical Access Hospital payment structure.

Dayton General Hospital and Garfield County Public Hospital in Pomeroy will face making reductions in services if the bill is passed.

House Bill 2130 is scheduled for a hearing Friday at 3:30 p.m., and hospital officials along with the Washington State Hospital Association are urging state residents to contact their legislators to ask them to oppose the bill.

The bill, if approved, would impact not only rural hospitals but urban hospitals, according to Cassie Sauer of the hospital association. Urban hospitals are likely to see more patients in their emergency rooms and to experience increased numbers of Medicaid and uncompensated patients.

Critical Access Hospitals are located in rural areas that generally have more elderly and lower-income families relying on Medicare and Medicaid payments than urban hospitals, according to Dayton General Hospital CEO Charlie Button.

The Critical Access Hospital designation allows those hospitals to break even on Medicaid services.

The proposed cut would take cost-based reimbursement away and replace it with a fee schedule that will pay on average 48 percent lower than cost-based reimbursement, a 76 percent reduction for Dayton General Hospital.

The overall impact of the proposed cuts to the 38 hospitals is $54 million, which is the loss of Medicaid plus federal matching funds. State Medicaid managed care payments would likely by cut by an additional $15.5 million, with a loss of matching federal funds, for a total cut of $85 million statewide

For Dayton General the cuts represent 5 percent of the overall budget, or $404,000. The hospital cannot sustain those cuts, Button said.

Dayton General Hospital employs 130 people, and is the largest employer in Columbia County. Cuts in reimbursement would be felt in critical health-care services and jobs in the community, Button said.

HB 2130 would not have as devastating an impact on Garfield County Hospital, which was the first Critical Access Hospital in the state, designated in 1999. If the bill is passed, the budget blow would be about $250,000.

This is because Garfield County has a relatively small Medicaid-eligible population, according to hospital CEO Andrew Craigie.

"I am very, very concerned. This is going to cause a crisis in the healthcare system in the state of Washington. There are hospitals in our area and in our region that are very threatened by this," Craigie said this morning.

Craigie said he is more concerned about what is happening at the federal level, where there is talk of eliminating Critical Access funding. That could result in closing the hospital, he said.

Garfield County hospital officials have taken steps to reduce the impact of cuts by mothballing eight beds in the nursing home that aren't being used.

In the past eight years, the nursing home occupancy has dropped from a high of about 94 percent to 80 percent, Craigie said. There are a number of reasons for the decrease, including a 25 percent drop in population in the county since 1976, and modern medical procedures that do not require hospitalized rehabilitation.

Also, families are choosing to take care of family members instead of having them admitted to a nursing facility, Craigie said.

For more information

More information and a list of legislators to contact is available from the Washington State Hospital Association, www.wsha.org.

Charlie Button can be contacted at 509-382-9355 or by email, charlieb@cchd-wa.gov.

Andrew Craigie can be reached at 509-566-4120, or by email, Andrew.Craigie@garfieldCountyPHD.org.

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