Safety Net Hospitals, Patients Fear That Florida Senate Budget Cuts Will Threaten Health Care Safety Net

TALLAHASSEE, Fla., April 7, 2011 /PRNewswire/ -- The state Senate's proposed budget would threaten Florida's health care safety net by imposing what amounts to a 35 percent Medicaid reimbursement cut on all Florida hospitals, especially impacting the 15 safety net hospital systems, hospital officials and patients said Thursday.

The Senate's proposed budget cuts — part of the chamber's effort to close a $3.6 billion state budget deficit — will threaten access to care for hundreds of thousands of the state's most vulnerable citizens, pressure hospitals to consider reducing or eliminating vital community health services, and cost thousands of jobs, officials say.

"These cuts, which are unprecedented in their enormity, will hurt patients, hospitals and communities across Florida," said Tony Carvalho, President of the Safety Net Hospital Alliance of Florida (SNHAF), which represents the state's leading teaching, public and children's hospitals. "We are urging the Senate to maintain funding for the Medically Needy and Medicaid for the Aged and Disabled programs, similar to what is being recommended by the Florida House."

In its 2011-2012 budget proposal, the Senate would cut Medicaid reimbursement rates to safety net hospitals by 10 percent, eliminate all hospital services under the Medically Needy program, and totally eliminate the Medicaid for the Aged and Disabled program. This amounts to $720 million in annualized cuts to just 15 safety net hospital systems.  

Medically Needy provides hospital services to working poor, uninsured Floridians who have had a catastrophic illness, such as cancer and heart diseases, debilitating injury, or an organ transplant. Some 177,000 Floridians are touched by the Medically Needy program each year.  

Meanwhile, Medicaid for the Aged and Disabled provides hospital and other health services to poor people over the age of 65 and/or those who are permanently and totally disabled. About 42,000 Floridians a month are expected to qualify for Medicaid for the Aged and Disabled next year.

"I am getting frantic calls from Medically Needy patients all across the state who are very scared about the Senate's proposal," said Mary Ellen Ross, president of the Florida Transplant Survivors Coalition. "These people are very sick and depend on Medically Needy coverage to survive. They are desperate for the Senate to reconsider its stance."

Because Medically Needy patients routinely require hospitalization, the Senate's proposal will not reduce overall health care costs, but instead will simply shift the financial burden for caring for these vulnerable patients from the state government to local hospitals, their communities and local taxpayers.    

"Ultimately, safety net hospitals and their local communities — which are also struggling to rebound from the effects of the recession — will be forced to scramble to find alternative ways to provide care to these patients," said Ron Hytoff, President and CEO of Tampa General Hospital, and the current Chairman of the SNHAF board. "And our greatest fear is that some of these patients will fall through the cracks and miss out on care they depend on to survive."

The proposed cuts would be significant and hurtful to all Florida hospitals, but especially damaging to safety net hospitals. These 15 hospitals deliver nearly half of all the charity and Medicaid care to patients in Florida, and are now being asked to absorb a dangerously disproportionate level of the Senate's proposed Medicaid cuts.

The $720 million being slashed from just 15 safety net hospital systems is 45 percent of the total $1.8 billion in program cuts that the Senate is leveling on all 200 hospitals in the state. The Senate proposal also fails to provide $235 million to the state's hospitals for projected inflation increases through a Medicaid reimbursement rate freeze.

The combination of the 10 percent Medicaid reimbursement cut, along with the dramatic reductions of hospital services under the Medically Needy program and elimination of the Medicaid for the Aged and Disabled program, amounts to an effective 35 percent reimbursement cut on the safety net hospital systems.

"Hospitals are one of Florida's leading economic drivers, and to force hospitals to carry a disproportionate amount of cuts is totally unrealistic and will threaten the financial viability of some of the safety net hospitals," Carvalho said. "The Senate is, in effect, attempting to place an unrealistic portion of the $3.6 billion state budget deficit on the backs of all hospitals, and the state's teaching, public and children's hospitals will be hit the hardest."

Each of the safety net hospitals is facing reimbursement cuts in the tens of millions. Projected cuts total $177.5 million at Jackson Health System; $75.6 million at Orlando Health; $73.2 million at Broward Health; $65.2 million at Tampa General Hospital; $63.4 million at Shands at the University of Florida; $62.7 million at Memorial Healthcare System; $60.5 million at Shands Jacksonville; $39.8 million at Lee Memorial Health System; $22 million at Halifax Health; $15.7 million at Miami Children's Hospital; $15.6 million at Sacred Heart Health System; $15.3 million at Sarasota Memorial Health System; $15.1 million at All Children's Hospital; $9.4 million at Bay Medical Center; and $9.1 million at Mount Sinai Medical Center.

The projected impact of the cuts on each of the 15 safety net hospital systems is varied and dramatic.

For example, Jackson Health System in Miami, Florida's largest safety net provider, will see funding slashed $177.5 million under the Senate's proposal. Officials there say reductions that huge will impact Jackson's ability to continue delivering programs all across the continuum of care, ranging from children's services to long-term care.

Tampa General, one of Florida's largest teaching hospitals, is projected to lose $65.2 million under the Senate's proposal. Officials there said that cuts that large would "hamper the hospital's ability to maintain current funding levels for medical residents" and "result in a reduction of the workforce in an area that already has an unemployment rate greater than 12 percent."

Meanwhile, administrators at All Children's Hospital in St. Petersburg noted that 70 percent of the children they care for are on Medicaid — and many are receiving highly specialized services unavailable elsewhere. The Senate's proposed cut of $15.1 million would "threaten All Children's ability to serve the most vulnerable children in Florida," officials there said.  

Safety net hospital officials urged Senate budget negotiators to consider an approach similar to the House's budget proposal. The House proposes to cut hospital Medicaid reimbursements by 7 percent, while maintaining hospital coverage in Medically Needy and preserving Medicaid for the Aged and Disabled — while also balancing the state budget. All told, the House would cut the safety net hospitals by $140 million, while the Senate would take $720 million in cuts — a difference of $580 million.

"Florida's safety net hospitals understand that legislative leaders face many heart-wrenching choices as they undergo the very difficult task of balancing the state budget," Carvalho said. "Safety net hospitals stand ready to work with the Florida Legislature to assume their fair share of rate cuts, but we can't eliminate critical health coverage that about a quarter of a million Floridians rely on."

SOURCE Safety Net Hospital Alliance of Florida