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Payment delays to hospitals

Published (3/28/2008)
By Patty Ostberg
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The House Health Care and Human Services Finance Division’s omnibus bill calls for a $131 million cut in this biennium.

Most of last year’s MinnesotaCare expansions remain, but hospitals wouldn’t fare as well with rebasing and managed care payments delayed for up to one year.

Rep. Thomas Huntley (DFL-Duluth), the sponsor of HF3976, said it would protect most of last year’s expansions, nursing homes and long-term care facilities from cuts. “The state is in a fiscal crisis and we have to balance a budget which means we have to make cuts. That is a very tough thing to do.”

The bill was approved by the division March 25, and incorporated in the supplemental budget bill (HF1812) by the House Finance Committee.

In part, the bill would:

• remove the cap on the Minnesota Family Investment Program that provides food and cash assistance to needy families;

• create a study on alternative approaches to offering dental coverage for public program enrollees;

• transfer remaining funds from certain accounts, such as the Chemical Dependency Treatment Fund, to the General Fund;

• freeze substance abuse treatment rates;

• make technical changes to meet federal requirements; and

• delay by one year increased hospital payment rates for medical and general assistance programs that are currently at a 2002 cost rate.

By delaying hospital rebasing, the cost savings are expected to total $9 million this biennium and $30 million in the next biennium.

Huntley said the burden falls on hospitals. Most of the health and human services budget goes to long-term care and nursing homes, and if you don’t cut those items, the cuts have to come from somewhere else, he said.

Rep. Steve Gottwalt (R-St. Cloud) unsuccessfully offered an amendment that would have used money in the state’s Health Care Access Fund to increase funds to nursing homes 5 percent per year in fiscal years 2010-11. The House DFL budget plan does not touch the fund; the governor takes $250 million.

Huntley said the state hasn’t done a good job of providing for seniors, but health care access money would take away health care for needy children.

“We’re not going to stop people from getting older. But we have to understand that taking money from one area and giving it to another has consequences,” said Rep. Larry Hosch (DFL-St. Joseph).

Several amendments were presented and then withdrawn that would have increased money to nursing homes.

“We’re going to be looking back on these times as the good ol’ days,” said Rep. Matt Dean (R-Dellwood).

A companion bill, SF3745, sponsored by Sen. Pat Pariseau (R-Farmington), awaits action in the Senate Health, Housing and Family Security Committee.

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