Local impact of cuts detailed
BRUNSWICK — Leaders of Brunswick’s two hospitals said Wednesday that cuts proposed to the MaineCare program by Gov. Paul LePage would cost them nearly $ 3 million over the next two years.
If the Legislature enacts LePage’s proposal as written, Mid Coast Hospital would face cuts of $ 2.2 million, while Parkview Adventist Medical Center would see a reduction of $665,000.
The proposed cut to MaineCare reimbursement rates for inpatient and outpatient services is part of LePage’s plan to address a projected shortfall in the Maine Department of Health and Human Services budget.
LePage’s plan would eliminate coverage for 65,000 MaineCare recipients, impose stricter income limits and cut services. DHHS spokesman John Martins said Wednesday that without the proposed cuts, MaineCare will run out of money on April 1.
For Brunswick’s two hospitals, the cuts would mean rethinking programs and services, staffing levels and the level of free care each provides.
Mid Coast Hospital would face a $410,000 reduction for the remainder of 2012 under the current proposal, with another $1.8 million in cuts projected for 2013, Mid Coast Health Services President and Chief Executive Officer Lois Skillings said Wednesday.
The new reductions would add to the $ 12 million the state owes the hospital for reimbursement for 2010-11, Skillings said.
“We really can’t sustain that,” she said. “ We’re already such an efficient organization and we really just can’t take any more cuts.”
Skillings said hospital administrators have not yet discussed potential layoffs from the health care system’s 1,600 employees, noting, “We are, right now, just doing everything we can to prevent this from happening. We’re working to explain the delicate ecosystem of health care financing and the impact on our community.”
Parkview would see $65,000 in cuts this year, with a “minimal effect” on the hospital, President and CEO Ted Lewis said Wednesday. A far more significant impact — $600,000 — would be felt during the hospital’s next fiscal year, which runs from July 2012 to June 2013.
Should the cuts go through as proposed, Lewis said, the initial $65,000 hit would be built into this year’s budget without job or program cuts, “but next year would be a different story (with) a far bigger impact.”
Without citing specifics, Lewis said the hospital is “working on a strategy that will impact the fewest services and patients as possible.”
Part of that strategy would likely involve reducing Parkview’s income guidelines for free care during the second year of the proposed cuts, he said. The hospital currently provides free care to those with incomes at two to three times the federal poverty level, but might be forced to reduce it to only those at or below the poverty level.
Mid Coast Health Services, which last year provided $8.5 million in free care, would also experience impacts to its free care delivery, according to Skillings.
“We are the community safety net, open 24 hours a day, seven days a week, every day of the year,” Skillings said. “We provide free care and we are wide open to MaineCare. Anybody can come.”
But should the proposed cuts move forward, not only would Mid Coast face $2.2 million less in revenue this year and next, the hospital would be further taxed by anticipated spikes in the number of people seeking free care because their MaineCare coverage had been eliminated.
“We cannot absorb this revenue hit and we also cannot pass on the increase to local employers,” Skillings said. “The choice would be to cut programs, but it’s not like there is any fluff here. We’re already the lowest-cost community hospital in the state of Maine.”
Specific programs run at and through the hospital, including the Addiction Resource Center, Healthy Maine Partnership and ACCESS Health, are targeted for additional cuts.
Other organizations that provide services to Mid-coast area residents as well, including Sweetser, which provides mental health services for adults and children throughout the state, face cuts under LePage’s proposal.
Carl Pendleton, Sweetser’s president and CEO, said that in the Brunswick area, the cuts would most seriously affect adults without children and case management services. Sweetser also provides crisis services at Mid Coast Hospital, but Pendleton said he’s still not sure whether LePage has proposed cutting or “a major overhaul” of crisis services.
“He basically has looked at the federal requirements and gone through the bare minimum,” Pendleton said. “ I think that’s where he wants to start his negotiations. Then, as the Legislature realizes we can’t do this, because it would put people at great risk, I think he’s hoping that as they negotiate (services) back into the budget, it will be ... a win for him.”
Pendleton said he’s particularly frustrated that those who now qualify for MaineCare services would pay for mistakes of previous administrations, including a “costly” attempt to upgrade DHHS software.
“The biggest problem I have is that many of the budget shortfalls being attributed to DHHS have nothing to do with Maine’s dependency on MaineCare,” Pendleton said. “It has an awful lot to do with — mismanagement is too strong a word, but ... they lost big bucks ... Why should people who are getting MaineCare services have to pay for that kind of miscue?”
Rep. David Webster, DFreeport, sits on the Legislature’s Appropriations Committee, which will review the cuts and make recommendations to the Legislature.
Webster said Wednesday that LePage’s proposed cuts would actually increase costs to taxpayers and those who pay premiums for private health insurance. Individuals who lose MaineCare would not have access to preventative care, he argued, so when they get sick they would not be able to work, and they would generate more health care costs because they would be treated in emergency rooms.
“The cost shift goes from maybe paying taxes to the state to winding up having your health insurance premiums skyrocket because hospitals are covering so many people who come to the emergency room,” he said.
LePage originally proposed eliminating state funding for all private non-medical institutions (PNMIs, or residential or boarding homes), which would leave 16,000 people, including seniors and adults with severe and persistent mental illness, without a place to live or personal care services, according to Melissa Fochesato of ACCESS Health and the Mid Coast Hospital Substance Abuse Prevention Program.
Webster said some proponents of the cuts “seem to be surprised” by the consequences pointed out by advocates and consumers.
“The governor has already admitted that he didn’t expect his plan ( for PNMI) would actually be carried forward. He sent us a plan he didn’t expect to be implemented anyway and now he’s telling us we’re wasting time. This was a plan without a plan. They don’t understand the consequences. They just took a simple route to cut because it looked like easy pickings.”
On Wednesday afternoon, LePage fired back: “Consider the source of this accusation. Democrats for years have been illegally funding welfare with ‘gimmicks.’ This year alone we have had to refund $ 29.3 million of Medicaid funds spent inappropriately. Currently, the federal government is auditing the state for other Medicaid misuse.”
“My administration is not cutting, we are trying to bring this program back to a sustainable, quality safety net that protects our most vulnerable citizens, and at the same time we are cleaning up a significant misuse of federal funds,” the governor continued. “We can only spend what the Legislature legally appropriates.”
Martins said Wednesday that the budget does target optional services that are not required by the federal Medicaid program. But he said LePage “set aside about $39 million to make adjustments to the budget based on unintended consequences or things that we know may be a challenge, based on the budget being passed.
“The governor has shown a lot of concern for the PNMI program, and that’s one area we’re looking at,” Martins said.
But hospital administrators remain watchful of the Legislature’s debate over the cuts, trying to balance awareness of the budget crisis with concern over patients.
“We recognize the challenge that the state has, but this is just really shifting the problem,” Skillings said. “We understand there’s a huge challenge ahead for all of us to really rein in the cost of health care, but at the same time, hospitals and health care systems can’t really afford to take any reductions on reimbursement, especially on top of the fact that we’re already owed such a significant amount of back payment.”