Medicaid cut hits home for Doctors Hospital

With the passage of the fiscal year 2006 budget, which takes effect July 1, 2005, those cuts became evident.

The governor recommended – and the state legislature passed – $580.6 million in cuts to the state’s Medicaid funding. Blunt has offered assurances that funding will remain at the same levels for children and pregnant women.

Lost revenue

But the cuts are affecting more than just individuals.

Doctors Hospital in Springfield receives 40 percent of its annual revenue from Medicaid, and another 40 percent comes from patients who pay using Medicare, according to Alexis Brown, director of communications for Doctors Hospital. The reduction in funding could result in a loss of $500,000 to $600,000 for the hospital in the state’s 2006 fiscal year.

Brown said there could be other effects of the funding cuts as well.

“There’s a lot of talk about people who lose their Medicaid eligibility coming into the (emergency room), but that’s going to be very hard to predict,” she said.

Hospital CEO Paul Taylor said he expects to see an increase in self-pay patients.

“We don’t have the advantage of some providers of shifting some of the cost and burden of providing care to the uninsured by focusing on delivery of health care to those patients who are insured,” he said. “We are situated in such a way that without changing our niche and our focus, (changing) would be difficult to do.”

Delayed payment

Cuts in the budget aren’t the only issue. The state also suspended payouts of Medicaid money to hospitals, saying the money was needed to pay income tax refunds.

Jessica Robinson, spokesperson with Blunt’s office, said the decrease in spending is necessary to keep the program sustainable.

“It’s now a program that the state can actually afford that also provides care for those citizens who most need it,” she said. “The reality is that the program’s expenses were growing so uncontrollably and had been left to grow so unchecked that within 10 years (Medicaid) would have consumed all of the state’s budget.”

As for the delayed payments to hospitals, Robinson said all payments will be received by the hospitals before June 30, the end of the fiscal year.

Taylor said that withholding hurts the hospital as much as future cutbacks will.

“We’re weathering that storm, and then we’ll prepare for the next one,” he said. “There are several different kinds of impact here. We’re simply going to make less money providing care to this population. There’s no doubt about that.”

In the state’s FY 2006 social services budget, the administration says that the Medicaid system “has grown out of control,” citing a 108 percent increase in state Medicaid funding over the last seven years.

The budget also cited a finding from the National Association of State Budget Officers that said that growth in state spending for Medicaid “threatens the ability to budget adequately for other critical areas.

“Without taking aggressive action to control spending increases, the state cannot properly fund education – a priority for all Missourians,” the report said.

Taylor said, while the cuts will hurt, he thinks Doctors Hospital will be able to survive the barrage.

“For the time being we intend to simply continue providing the services to the patient population that we have been,” Taylor said. “We’ll try to weather the storm and see if this is a pendulum swinging one way or if this is going to make some permanent changes to the way we provide care.”

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