April 30, 2013

Payment to Maine hospitals slowed?

Lawmakers' linking of debt payment and Medicaid expansion could delay repayment of millions owed, a lobbyist says.

By Michael Shepherd mshepherd@mainetoday.com
State House Bureau

AUGUSTA — A representative of Maine's hospitals said Monday he is surprised and disappointed that Democratic lawmakers want to combine a decision on Medicaid expansion with a proposal to pay a $186 million debt to hospitals.

click image to enlarge

In this file photo, Linda Farley and Sharon Wallace care for a patient at Maine Medical Center in Portland. Democratic lawmakers want to combine a decision on Medicaid expansion with a proposal to pay a $186 million debt to hospitals.

Staff Photo by Herb Swanson

While hospitals support both the debt payment and expanding Medicaid coverage to 55,000 additional Mainers, differing time frames for legislative action mean that linking the two issues could slow down the payment of $484 million in state and federal money owed to hospitals, said Jeffrey Austin, lobbyist for the Maine Hospital Association. If Maine pays the hospitals money owed for past care provided to Medicaid patients before October, the state will save $5 million, he said.

A $186 million payment by the state would trigger about $298 million matching federal payments, bringing the total payment to hospitals to $484 million.

"We feel we've met all of our obligations to be paid," Austin said. "Linking the two is unacceptable."

Gov. Paul LePage blasted Democratic leaders in a statement Friday after they told him of the plan in a meeting Thursday, saying they reneged on their commitment to pay back hospitals.

But Senate President Justin Alfond, D-Portland, said Democrats have been clear about wanting to work to lower the cost of health care and paying hospitals during the session.

"As we make this final payment, we should be linking in driving down the cost of health care," he said. "We believe one package is the best approach."

Speaker of the House Mark Eves, D-North Berwick, said in a statement Monday that the Legislature will be sending the governor a bill that combines the issues.

"It's important to approach health care in a comprehensive way," Eves said. "To do one without the other would leave our work only half done."

Adrienne Bennett, LePage press secretary, said resolving the Medicaid issue will take longer than repaying the hospitals because the administration is looking for the best possible Medicaid-expansion deal from the federal government.

The federal government would pay 100 percent of the state's costs for the expansion from 2014 to 2016, then gradually reduce reimbursements to 90 percent of the cost. The LePage administration, meanwhile, told the Obama administration that Maine will consider participating in the expansion if the federal government pays for affected recipients for 10 years. Bennett said the administration hasn't gotten an answer on that proposal.

LePage issued a statement Monday calling upon legislators to vote on his original hospital payment proposal.

"Republicans and many good Democrats have been ready for months to pay the hospitals, and the Maine people know it is the right thing to do," LePage said. "I'm calling on Democratic leadership to let legislators take a simple up or down vote on my plan," the governor added.

Alfond said that's not his party's plan.

Alfond said he also supports getting the best deal for the state with regard to Medicaid expansion, but the Legislature will likely have the information it needs on expansion in time to move forward on both issues.

The Legislature's Veterans and Legal Affairs Committee has said it plans to draft a bill to pay the hospital debt, effectively paying for it with liquor contract revenue.

Meanwhile, the Legislature's Health and Human Services Committee is mulling a proposal from Rep. Linda Sanborn, D-Gorham, to expand access to Medicaid, the federal health care program for the poor.

Several advocacy groups, including AARP Maine, plan to launch statewide radio and newspaper ads on Wednesday to support that proposal.

Alfond said Democratic leaders will be moving forward to combine the two bills into one proposal.

The Democrats' effort to use the hospital payment as leverage to win Medicaid expansion follows LePage's own efforts to link issues together as leverage.

(Continued on page 2)

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