Hospitals to receive $373.7M from state
STATE

Hospitals to receive $373.7M from state


Past-due payments to save, create jobs
By Mal Leary
Capitol News Service

AUGUSTA, Maine — Jobs will be saved, others created and Maine hospitals will be able to expand some facilities as a result of the state sending the first of two payments that will total $373.7 million for past-due bills owed them by the state.

Gov. John Baldacci signed a financial order Tuesday in the Hall of Flags at the State House to applause from lawmakers and hospital officials that will make $163 million in state and federal funds available within weeks to hospitals as a result of the stimulus package.

“This is a good day,” he said in an interview. “This fulfills a promise made to the hospitals to pay them what is owed and help save jobs and create jobs.”

The financial order was made possible by legislative action in the supplemental budget that ensured the top priority for state funds freed up by increased federal support would be directed toward hospital bills.

“This was a bipartisan agreement and had broad legislative support,” Baldacci said.

While the money used to pay the settlements does not directly come from the stimulus package, the governor said federal officials have said the transparency and accountability rules will also apply to the hospital payments.

“This will be totally transparent,” Baldacci said. “In fact we are going to begin that process right now. We are sending the hospitals a letter with the forms that need to be filled in.”

He said the information will be posted on both the state and national recovery Web sites. Steve Michaud, president of the Maine Hospital Association, said in an interview that he has spoken with hospital administrators and they are ready to comply with the disclosure process.

“We are all for transparency and accountability,” he said.

Michaud said a significant amount of the cash would go to pay off lines of credit that about a third of the hospitals have with banks. He said hospitals were forced to borrow to pay operating expenses when the state did not pay them what was owed in a timely manner.

“This will help reduce health care costs,” Michaud said. “Hospitals will no longer be paying interest on those lines of credit.”

He said “several hundred” positions at hospitals across the state have been cut and he expects many of those will be restored with the cash from the payments. He said with the pressure of the recession, there also will be other jobs that would have been cut that now will be maintained.

“And we know that several hospitals have capital projects that have been deferred because they just didn’t have the resources,” Michaud said. “We will see new projects and programs.”

Baldacci said he had spoken with several hospital administrators who attended the signing ceremony and said he expects some additional wellness programs will be developed with the funding hospitals will receive.

“There was a lot of energy and enthusiasm in that hall about projects that can be undertaken to make hospitals more energy efficient and more efficient in the delivery of services,” he said.

Michaud said that while he does not have specific information on projects any of the hospitals are planning, he does expect a significant amount of construction will occur. He said that will generate construction jobs in addition to the jobs saved or created by the hospitals with the infusion of the cash.

Under the transparency rules, the hospitals will have to explain how every dollar is spent. There will be a listing of jobs saved and jobs created, both at the hospitals and indirectly as the result of any new initiatives that are undertaken.

Baldacci praised the state’s congressional delegation for its work in passing the federal legislation. Sen. Olympia Snowe was a key player in the negotiations over Medicaid matching rates that allowed the state to bring in more federal dollars and provide larger payments to the hospitals.

“When we passed the stimulus package last month, the Medicaid aid to states was a fundamental element,” Snowe said in a statement. “We knew it would provide short-term help to hospitals struggling to keep up with increased demand and long-term support for Americans unable to afford health care services. This crucial funding will keep health care workers employed and rural health care programs from falling through budget cracks.”

The second payment to the hospitals, $210.7 million in state and federal funds will come in budget year 2010 as part of the two-year state budget now under consideration by the Legislature.

Not registered? Click here
E-mail this
Print this
Guidelines for posting on bangordailynews.com

Bangordailynews.com is pleased to offer a forum for readers to react to our stories, discuss them and provide additional information. We are reluctant to delete comments, but do reserve that right for those who abuse our forum. For more on using this site, please see our terms of service.

The primary rule here is pretty simple: Treat others with the same respect you'd want for yourself. What does that mean specifically? Here are some guidelines (see more):

Comments
22 comments on this item

The hospitals had to borrow from banks to cover operatoring expenses and then pay interest on top of that because the state wouldn't pay its bill. I love this state.

Certainly needed relief for the Hospitals. However, I am amazed at the arrogance of our elected officials. The Governor "fulfills a promise made to the hospitals". What exactly did the Governor do to fulfill that promise. Nothing. He use stimulus money borrowed from future generations. Did he have some precognition that the federal government would bail him out as the State short paid the hospitals for years? Not likely. Pure luck. If I were the hospitals officials, I would not count on the rest of the money in 2010. And let us not forget, that in a few years the Hospital debt will return, because the State continues to underpay the Hospitals.

It is equally amazing that the Hospitals waited for years to get paid for what is rightfully theirs, only to find out that there are "transparency" strings attached. More time wasted on ridicules regulations.

Crooks!

What about the charges accrued from now until next year?? Is that going to be paid with the stimulus package of 2012?? There is no mention from Baldacci if the state will pay current bills in a timely fashion. But what does he care, he's not running for governor again, right? If I don't make payments to EMMC for my stay there last year, it will be sent to collections which kills my credit rating. Is Maine's credit rating suffering because of these unpaid bills? I doubt it. So I"m thinking that if I have to go inpatient again, I should ask for a private room and fly in doctors from Europe to have any procedure done because it seems that the more one owes, the better off one is as there appears to be no penalty for anything owed above $100,000,000

I would be embarrased if i was gov who promised this to happen before the last election and was saved by the stimulus monies. It is apparant the hospitals don't trust him anymore, so they will pay credit lines and keep cutting their overhead if they are smart. I hope some smart people start running for legislature and for Gov and just do 1 term and help get another responsible person to run. Having time on your hands should not be the reason to run for legislature.

I would say that the state probably didnt have a choice but to pay the hospitals under the guidelines of the stimulus money and how it could be spent and on what

Oh and by the way the collection agencies are not allowed to call the state for money that the state owes them or to report the state to a credit agency

The State of Maine finally pays its bills and its fronnt page news. Go figure. The BDN really is becoming the governors newspaper. How about MAINE TO USE STIMULUS MONEY TO PAY OFF HOSPITAL DEBT.

holding back payments hostage based on the premise that each dollar gets a line item on where it will go....unbelievable. This is half way down the slippery slope of the government deciding where any money gets spent (even for private companies). If I'm owed money from some one I expect it to be paid back with NO STRINGS attached. The hospitals need to grow a pair and tell the state to get the money somewhere else where it won't come with conditions. . . ridiculous.

The state of maine,Baldacci ,Finally pays part of its bills to hospitals.Trouble is Baldacci fails to mention the bill is over 500 millon.What about the roads in Maine.they are the worst that they have ever been.I think that Baldacci will go down in history as the one of worst governor ever.

Let's not forget, that the current Governor does not believe this was his problem. According to him, it was all Governor King’s fault. Do you think the Governor envisions himself as the White Knight riding in on his steed to save the day?

Baldacci did NOTHING....washington and generations to come paid this!

ANOTHER (AIG) WAITING TO HAPPEN. I'M SURE AS SOON AS THE NMMC BIG WIGS TAKE THIER RAISE FROM THAT MONEY, THEY WILL HIRE BACK THE STAFF THEY LAID OFF BECAUSE THEY WOULDN'T TAKE A CUT IN PAY LIKE THE OTHERS.

“This is a good day,” he said in an interview. “This fulfills a promise made to the hospitals to pay them what is owed and help save jobs and create jobs.”

Baldy, you shouldn't have gotten us in the position in the first place. what happens the next time when there is no bailout? Grab your ankles hospitals.

Only a politician would call a press conference invite the reporters to CELEBRATE paying a past due bill!!!!!!!!!!!!!

i wonder if a % could to the OB dept at teh Blue Hill Hosp to prevent it for shutting down?

The current system of MaineCare rules and regs is what made the past-due bills so bad. Those regs are only a few steps away from Universal Health Care - and we can see a glimpse of what that will be like.

As opposed to the paradise that is the current system of for-profit insurance companies... I sure hope that when I get cancer, some insurance executive makes a bundle by denying me treatment and hiking my deductibles.

You must be logged in to post a comment. click here to log in.

Powered by: Creative Circle Advertising Solutions, Inc.