Lawmakers mull Medicaid cuts

Pennsylvania healthcare providers say the Senate’s budget walks away from federal dollars.

Hospital executives were in Harrisburg Thursday reminding lawmakers that medical centers are an economic anchor in many Pennsylvania communities. They say proposed cuts to hospital Medicaid payments will lead to job losses across the Commonwealth. WHYY reports on a budget plan hearing at the Capitol. (Photo: Flickr/Darragh Sherwin)

Listen: [audio:090521tesenate.mp3]

The budget approved by the Republican-controlled senate reduces Medicaid funding to hospitals by nearly $280 million in combined federal and state money. Barry Freedman is CEO of the Albert Einstein Healthcare Network.

Freedman: These cuts in Medicaid reimbursement proposed by both the Governor and the Senate hit the state’s urban area’s the hardest. More than 75 percent of the $280 million cut will effect hospitals in the state’s two largest counties.

Freedman says hospitals in Philadelphia County would lose $150 million. He says medical centers in Allegheny County would get about $50 million less in the coming fiscal year.

Capitol observers say the Senate budget is a negotiation starter that won’t likely reach the House floor for serious debate. Even so, hospital chiefs say the Senate’s willingness to cut hospital payments is worrisome because, they say, the Medicaid program is an economic stimulator.

Pennsylvania healthcare providers say the proposed Medicaid cuts will harm the economy and lower the quality of healthcare in the state. Ron Barth leads an association of nursing home and assisted living facilities. During the hearing at the Capitol, he asked lawmakers to reject the senate budget.

Barth says the federal stimulus plan increases the government match for Medicaid, but the Senate plan walks away from those dollars.

Barth: Every dollar of state funds siphoned from the Medicaid senior services providers represents one dollar and seventy cents amount of federal funds that are forfeited.

Barth says Governor Rendell’s February budget allocated 1.09 billion dollars in Medicaid funding for nursing homes and seniors services. He says the senate budget reduces that amount to 1.02 billion.

Other healthcare providers said the proposed cuts will cost the Commonwealth millions in federal dollars. The federal stimulus plan boosts the government Medicaid match, but the head of the state’s hospital association says the budget plan approved by the Senate walks away from that help.

The Senate plan reduces hospital Medicaid payments by $116 million compared to this year. That’s more than three times the Medicaid cuts proposed by the Governor in February.

Philadelphia Democrat Kathy Manderino said Pennsylvania will have to spend money it doesn’t have to draw down the federal Medicaid dollars.

Manderino: We now know that we are looking at an over a three billion dollar deficit. And so even to reach the numbers that were in the Governor’s budget as it affects these various health care payments means we have to find the money from somewhere.