At least some layoffs such as those announced Wednesday at Fort Kent’s Northern Maine Medical Center will be prevented at other hospitals by the state Legislature’s recent passage of a supplemental budget maintaining funding for 15 critical care centers, state officials said Wednesday.
Citing expected federal funding shortfalls and a looming state budget gap, Gov. John Baldacci proposed a cut of about $34.7 million to the state’s $1 billion 2009 Health and Human Services budget. That would have eliminated about $4.5 million from the state’s hospital-based physicians reimbursement plan and MaineCare critical-access hospital budget. It also would have spurred cuts in federal health care funding programs.
But the House voted 120-22 in late January to restore about $1.4 million of the $4.5 million and to effectively defer payment of another $2.6 million to hospitals into fiscal year 2010, state officials said.
The lawmakers stipulated that any federal Medicaid relief money within President Obama’s pending economic stimulus package would pay for MaineCare hospital service provided in 2005 and 2006, said Mary Mayhew, vice president of the Maine Hospital Association.
The state owes hospitals more than $400 million in payments for health care provided to low-income residents and others 2005-08, said Mayhew, whose nonprofit organization represents 39 community-governed hospitals and is their primary advocate with the Legislature, U.S. Congress and state and federal regulatory agencies.
“Part of the challenges hospitals face now is that they are carrying millions in accounts receivable that are owed to them by the state, which is exacerbating the financial pressures the hospitals already have,” Mayhew said Wednesday. “Getting this money paid will help alleviate some of the cash pressures that hospitals are facing right now.”
Many of the dozen hospitals that would have been affected by the cuts provide much-needed medical services to areas that otherwise lack them. That includes the Katahdin region’s Millinocket Regional Hospital, an area represented by state Rep. Herbie Clark, D-Millinocket, who voted for the funding restoration.
“Critical access hospitals, like Millinocket Regional Hospital, provide essential services to the people of the Katahdin region,” Clark said in a statement. “Cutting the hospital’s funding is something the people here can’t afford.”
Allison Bankston, senior director of marketing and fund development at Penobscot Valley Hospital of Lincoln, estimated that the Legislature’s vote helped save PVH more than $600,000 a year. That “could have had a devastating impact on services to the community and people’s livelihoods,” she said.
MRH is a nonprofit 25-bed critical access hospital that offers primary care to Millinocket, East Millinocket, Medway and surrounding territories. A nonprofit, PVH is a 25-bed critical access hospital that provides primary care for a 1,300-square-mile area that includes Burlington, Carroll Plantation, Chester, Enfield, Howland, Lakeville, Lee, Lincoln, Lowell, Mattawamkeag, Maxfield, Passadumkeag, Seboeis Plantation, Springfield and Winn.
Though pleased at the Legislature’s vote, Mayhew cautioned that it might only delay the inevitable: Hospital layoffs caused by funding shortfalls and increases in the number of people — particularly the newly unemployed — who lack health care insurance and seek state aid to get it.
“We estimate that there still is approximately a $12-14 million cut to the hospital-based physicians program as a result of the supplemental budget,” Mayhew said.
The Legislature will re-examine the issue this month as it addresses the biennial budget, which sets state spending priorities for the next two fiscal years that begin July 1.
Hospitals that had funding restored by the Legislature
The State Legislature’s vote to restore funding to the state’s Health and Human Services budget for 2009 might have saved at least some layoffs at the critical-care, small and largely rural hospitals that would have faced shortfalls without the restoration. They are:
Blue Hill Memorial Hospital — Blue Hill
Bridgeton Hospital — Bridgeton
CA Dean Memorial Hospital — Greenville
Calais Regional Hospital — Calais
Down East Community Hospital — Machias
Houlton Regional Hospital — Houlton
Mayo Regional Hospital — Dover-Foxcroft
Millinocket Regional Hospital — Millinocket
Mount Desert Island Hospital — Bar Harbor
Penobscot Valley Hospital — Lincoln
Redington-Fairview Hospital — Skowhegan
Rumford Hospital — Rumford
St. Andrews Hospital — Boothbay Harbor
Sebasticook Valley Hospital — Pittsfield
Waldo County General Hospital — Belfast
Source: Maine State Government