Hospitals say medicaid cuts hurt economy

Hospitals say medicaid cuts hurt economy

Kelsey Radcliffe

Contributing Writer

More than 6,000 jobs and $2.6 billion would be lost over the next two years if Virginia’s Medicaid program is cut, according to the Virginia Hospital & Healthcare Association.

According to Sheldon M. Retchin, the CEO of the VCU Health System the Medicaid cuts would impact the VCU Medical Center. Retchin stated in a Richmond Times-Dispatch column that the portion of Medicaid and uninsured patients was more than 40 percent of the MCV Hospital’s total number of admissions.

“Last year we had more than 170,000 Medicaid and uninsured outpatient visits. And, because of the recession, we have seen an ever-increasing number of disadvantaged patients,” Retchin stated. “We delivered more than $23 million in health care to Medicaid and uninsured cancer patients last year.”

The VCU Health System has approximately 7,200 employees, generates billions of dollars in direct and indirect benefits to the region and acts as a preeminent research center that attracts industry and business interests, Retchin stated.

According to Retchin, Medicaid cuts would affect resources that support research, threaten jobs and programs, limit opportunities to attract new corporate interests, create long queues for appointments for uninsured patients and divert resources from the educational support.

Retchin stated the VCU Medical Center has more than 4,400 students in medicine, dentistry, pharmacy, nursing and allied health, along with approximately 700 post-graduate residents.

Grace Callow, a sophomore pre-nursing major and volunteer in the Peri-surgical Unit of the VCU Health System, said she understands that most of the medical center’s patients are supported by Medicaid but she did not expect the cuts to have such a large impact on students.

“You wouldn’t think a cut in Medicaid would affect students, but it does and that’s saying something,” Callow said. “It surprises me that it does have a place in education and I don’t know if it should.”

The Medicaid cuts are based on former Gov. Tim Kaine’s proposed budget cuts and further “Medicaid proportionate” cuts resulting from Virginia’s $2 billion budget shortfall, according to Laurens Sartoris, the president of the association.

“Whatever is saved by the General Assembly in the Medicaid budget gets doubled up in its effect on provider rates and services that get delivered to Virginians because we lose an equal amount of federal matching money,” Sartoris said.

Virginia could lose $720 million in Medicaid funding. That would result in a total loss of $1.4 billion when federal matching funds are included.

According to Sartoris, Virginia will also lose $140 million in state and local tax revenues as a result of the $720 million in cuts. An additional $1.2 billion will be lost through lower health care wages, lost employment and reduced support to local businesses, bringing the total loss to $2.6 billion.

“Virginia’s Medicaid program already is extraordinarily lean. There comes a point when cuts of this magnitude will hurt all Virginians and cause long-term damage to Virginia’s health care delivery system,” Sartoris said.

Gov. Bob McDonnell introduced his state budget proposal the same day the association revealed its budget figures. McDonnell’s budget reduces consumer-directed Medicaid services by $63 million and Medicaid provider reimbursement by $28 million, among other cuts to health and human resources.

Still, the House and Senate have the final call on Virginia’s budget. Legislators were working on their budget plans this weekend.

James Dahling, the president and CEO of Children’s Hospital of The King’s Daughters in Norfolk, said the hospital is the largest Medicaid provider of inpatient services in Virginia.

“Fifty-three percent of our patients are covered by Medicaid. The next closest provider in Virginia is at 28 percent,” Dahling said. “Any cuts to Medicaid threaten our very existence.”

Hospitals across the state will feel the impact of Medicaid cuts. According to David Darden, CEO of Clinch Valley Medical Center in Richlands, the hospital already cut jobs last year to offset the impact of the recession. Further cuts would lead to more job loss and threaten access to health care services, Darden said.

“Our citizens depend on us not only for their health care needs but also to strengthen the well being of the community,” Darden said.

On the Web

  • Gov. Bob McDonnell’s budget proposals:
  • Virginia Hospital and Healthcare Association:

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