Stevens: Aid should keep Riverland afloat

Published 12:00 am Friday, June 30, 2000

FERRIDAY, La. – Passage of more than $36.1 million in aid for rural hospitals should mean Riverland Medical Center will be able to stay afloat financially without significantly cutting services or personnel, Administrator Vernon Stevens said.

Legislation passed during a special session that ended Sunday requires the Louisiana Department of Health and Hospitals to restore 7 percent of Medicaid cuts it made earlier this year. Those cuts were first made March 1 but were stalled until a federal appeals court in mid-May reversed a district judge’s decision to block DHH Secretary David Hood from taking the action.

But the Legislature did not restore cuts to cross-over payments – the amount Medicaid pays in Medicare cases to cover expenses, such as deductibles, that Medicare won’t pay.

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&uot;The cross-over payment cuts would cost us more than $200,000 (a year),&uot;&160;said Stevens, past president of the Louisiana Rural Health Association. &uot;The 7-percent cuts would have only cost us $150,000.&uot;

But according to Stevens, money the Legislature appropriated in the fiscal 2000-01 budget for hospitals with fewer than 60 beds and serving an area of less than 15,000 people will offset Riverland’s loss from the cross-over payment cuts.

The more than $36.1 million in aid for rural hospitals will include $20.76 million in federal funds and $15.4 million in state funds.That amount would be used for the following purposes:

4$18.2 million to bring Medicaid reimbursement rates up to the same level they were in December 1999.

4$6.7 million to reimburse uncompensated costs, such as unpaid bills, not paid for by the federal government. Right now, the federal government pays 70 percent of such costs; the state would pay 30 percent.

4$6.1 million to establish a cost-based system of reimbursement. Hospital officials say the amount they are reimbursed by Medicaid is much lower than the actual cost of providing the services.

4$5 million to reimbursements the state owes rural hospitals from years past.

Even without such aid, Riverland would not have had to shut its doors in either case and would have done its best to make cuts that would not directly affect patients, Stevens said.

&uot;But some rural hospitals probably would (close),&uot;&160;he said, noting that that would affect access to prompt health care for the elderly and poor in many areas. He added that the state’s 38 rural hospitals also have a major economic impact on surrounding areas.

And about 80 percent of Riverland’s patients are Medicaid or Medicare patients, Stevens added. &uot;If we start closing, those patients – and more bad debt – will start showing up at bigger hospitals,&uot;&160;he said.

The legislation also protects small rural hospitals like Riverland from future across-the-board cuts in Medicaid reimbursement.