Proposed changes to New Hampshire's Medicaid policy may have a "substantial" impact on Dartmouth-Hitchcock Medical Center, according to DHMC spokesman Jason Aldous. DHMC's partner institutions, including Cheshire Medical Center/Dartmouth-Hitchcock Keene, will be similarly affected, according to Jill Batty, the hospital's chief financial officer.
The New Hampshire House of Representatives approved a $16 million budget cut on Tuesday, which included the changes to Medicaid. The New Hampshire Senate will review the budget reduction on Feb. 11.
Under the new policy, hospitals will no longer be able to bill the state Medicaid program an extra fee when hospital-affiliated doctors in private practice treat outpatients. The New Hampshire Department of Health and Human Services has projected that the change will eliminate $2 million in Medicaid funding, while the New Hampshire Hospital Association estimates that the proposed policy will result in a $4 million funding cut, according to a press release posted on the association's web site.
Medicaid is a joint federal-state program that reimburses hospitals and physicians for treating low-income and disabled patients who cannot afford to pay for medical care. State reductions in Medicaid payments increase the financial burden of hospitals that provide care to these patients.
Medicaid often does not cover the full cost of the treatment, Aldous said, requiring DHMC to absorb the loss or increase prices for patients with private insurance.
"Medicaid is something we generally lose money on," he said.
He estimated that the proposed cuts, if approved, will cost DHMC an additional $2 million annually. The medical center reported an operating surplus of $21 million in 2008.
DHMC administrators are optimistic that the federal economic stimulus package will provide funding for health and human services, Aldous said. DHMC officials plan to lobby the state for some of those funds to be allocated to DHMC and Medicaid to help cover future losses, he said.
"We're very hopeful money is coming to the state from the stimulus package," he said.
DHMC will also continue to work to reduce operating costs by improving internal efficiency, he added.
Cheshire Medical Center/Dartmouth-Hitchcock Keene, a member of the Dartmouth-Hitchcock health care system, will also suffer losses if the Medicaid cuts are approved, Batty said.
Batty estimated that the proposed cuts will cost the center $850,000 annually, reducing the hospital's projected operating budget surplus from 2 percent to 1.5 percent.
"In the event that the change is formally approved, we're going to be forced to adjust our operating budget by closing positions, reducing programs and delaying immediate capital improvements," Batty said.
Administrators at several New Hampshire hospitals believe that the Medicaid changes result from state legislators incorrectly interpreting the current federal Medicaid guidelines, according to Batty. The guidelines prohibit hospitals from charging Medicaid for patients treated by hospital-affiliated doctors in private practice as though they are regular hospital patients.
This Medicaid policy is likely to be repealed as part of the federal economic stimulus package, according to the New Hampshire Hospital Association's web site.
The New Hampshire Department of Health and Human Services did not return requests for comment by press time.
No members of the state House addressed the federal Medicaid regulations during the brief debate preceding the bill's approval, Rep. Peter Leishman, D-Peterborough, said. He added that the bill's opponents voted against it because they believed the budget cuts should be more substantial.
A division of the House finance committee will review the state's Medicaid program later in the month, Leishman said, stressing that none of the proposed cuts would be permanent.
"Everything will be readdressed in the next fiscal year," he said.
Staff writer Anya Perret contributed to the reporting of this article.
