Logansport Memorial Hospital officials say a recently announced 5 percent cut to Medicaid reimbursement to Hoosier hospitals means a loss of at least $186,000 for the Logansport facility.
Governor Mitch Daniels announced the plan to decrease Medicaid reimbursements along with a plan to cut all state department budgets by 10 percent.
“The implications of these cuts mean that six full-time positions could be lost, capital purchases could be postponed and the cost associated with more than 1,000 tests and treatments will be passed on to other patients,” hospital CEO Brian Shockney said.
Shockney said in order to fully understand the impact of the 5 percent cut, it is necessary to look at the big picture. In Cass County, he said, there has been a 12.3 percent increase in Medicaid recipients using hospital services.
“If you add that to the 5 percent cuts it makes it even worse,” Shockney said.
Other factors involved in rising hospital costs include charity cases and cases of bad debt.
From January through October, the amount of charity community assistance provided by Logansport Memorial Hospital has increased by 39.6 percent in one year’s time. The amount this year is $2.86 million worth of health care.
Cases involving bad debt, when a patient does not have health insurance or their care is not fully covered by their health insurance and they do not pay their hospital bills, have increased by $5 million from last year.
“Those are the largest jumps the hospital has ever experienced,” Shockney said. “And that’s what is not being told, is the big picture here. When you add all of this up, it’s huge. It’s real numbers and it’s real people.”
Chad Higgins, the hospital’s chief financial officer, said it is important to keep in mind that a minimum $186,000 difference for Logansport Memorial could mean huge dollar amounts at larger institutions throughout the state.
Indiana hospitals receive 35 cents on the dollar for Medicaid health care. Shockney said the 5 percent cut will force the hospital to make difficult decisions.
“We haven’t made any decisions at this point,” he said. “They are big decisions. Examples of what we are looking at are not re-hiring up to six people and not buying a new ambulance.”
Shockney said while he sympathizes with state politicians and the challenges they face due to the struggling economy, he believes health care should not be an area required to suffer.
“We as a nation are one of the only industrialized nations that when financial issues surface we cut to of the most important areas — health care and education,” Shockney said. “We need to realize those are two investments in our future.”
The hospital CEO said health care and education are easy targets because they encompass a broad range and involve large amounts of money.
“Every time we make a cut to those areas we are taking a hit to our future,” he said.
• Jennifer Tangeman is a reporter for the Pharos-Tribune. She can be reached at 574-732-5148 or jennifer.tangeman@pharostribune.com.
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