PA considers hospital payment cuts

    Pennsylvania’s Department of Welfare says the state could save $20 million by reducing payments to hospitals.

    Overall health care spending is getting a boost in Governor Rendell’s budget proposal. But the governor’s cost-cutting plans don’t spare hospitals in Pennsylvania.

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    Proposed Health Spending


    Hospitals that care for a large percentage of low-income or uninsured patients get extra money from the state, above and beyond the usual Medicaid reimbursement. But the Department of Public Welfare wants to save $20 million by reducing some of those supplemental payments.

    During a budget briefing, Public Welfare Secretary Estelle Richman said the cuts will be painful.

    Richman: As many of you who are hospital execs know, I’m making the rounds trying to figure out how to keep you solvent. Probably this year more than any other I have hospitals that are on the brink.

    Roger Baumgarten — with Pennsylvania’s Hospital & Healthsystem Association — says current Medicaid payments don’t cover the cost of care. He says cuts to supplemental payments will make it even harder to care for low-income patients. Baumgarten says the hospital association will push hard during budget negotiations to get the payments restored.

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