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Survey: Funding cuts have led to hospital reductions

Survey: Funding cuts have led to hospital reductions

March 27th, 2014 in News

A recent survey by the Missouri Hospital Association (MHA) found that federal funding cuts, high uncompensated care costs and changing patient utilization patterns at Missouri hospitals have led to reductions in the state's health-care workforce and a hiring freeze for many positions.

MHA is partnering with the Missouri Chamber of Commerce and Industry to promote the findings of the organization's recent hospital survey as reasons to reform the state's Medicaid system.

Of 114 hospitals asked to participate in the survey, 84 responded and many said that because of expected federal payment cuts of $4 billion from 2013-15, they expect reductions in the health-care workforce, delayed or canceled capital investments and the closing of nonprofitable service lines.

"There's been a lot of announcements of layoffs and job freezes out there right now, and our survey shows that 1,000 (health care) jobs have been lost in the state of Missouri in the last year," said Herb Kuhn, MHA's president and chief operating officer. "We're also seeing that 2,145 jobs have been frozen, a total of more than 3,000 jobs have been eliminated or suspended, and more than one-third of those layoffs and hiring freezes have been in rural areas."

Though MHA didn't specify whether Jefferson City hospitals - Capital Region Medical Center (CRMC) and St. Mary's Health Center (SMHC) - were surveyed, the hospitals defy the study's findings.

Thirty-seven of the surveyed hospitals responded that they have canceled or delayed needed renovations or repairs.

CRMC and SMHC have done neither.

Both hospitals cited cuts to DSH payments and federal reimbursements last May, but both are in the midst of major construction projects, what the study considers capital improvements.

"I think a lot of them are thinking about what their sustainability model is for the future," Kuhn said. "I think we should celebrate that, because what that means is that jobs are bringing that infrastructure. What those organizations are doing is asking what do I need to do to be more sustainable in the future? What do I need to be doing differently and how do I do it better?"

SMHC is building a new hospital at Missouri 179 and Mission Drive, which will open for business Nov. 16.

CRMC broke ground last month on a $37 million expansion project, meant to expand out-patient services and to attract physicians to the Capital City.

Kuhn said many current health-care construction projects are either replacing an older hospital, like Jefferson City's SMHC, or they're converting the facility to get ready for the outpatient-centered, health-care future.

Both Jefferson City hospitals also haven't had significant workforce reductions, like many hospitals that MHA surveyed.

Due to a decreased in-patient volume in January, CRMC required its non-nursing and non-clinical staff to take time off over a six-week period as a cost-savings measure.

Bob Mazur, CRMC's vice president of human resources, said the hospital has periodically required employees to do so.

SMHC hasn't had to reduce staff hours, but the hospital's chief operating officer, Tony Houston, told the News Tribune earlier this month that hospital officials are always looking at in-patient volume.

"We're always looking at volume, whether it be in-patient or out-patient, and adjusting our teams appropriately, either up or down," he said. "If volume is down, you need to flex folks (staff) down, and when it goes up, you flex people up."

Dan Mehan, president and chief operating officer of the Missouri Chamber, said the consequences hospitals are facing due to federal payment cuts and those that hospitals will face in the future could put many rural hospitals out of business.

He and Kuhn said the state's inaction on Medicaid reform could be even more detrimental.

"Medicaid reform matters," Kuhn said. "Without it, financial constraints will continue to limit hospitals' ability to deliver services to Missouri communities and support local economies. What this data demonstrates is that the damage is already occurring."

Mehan agreed. He said the health-care industry makes up nearly 20 percent of Missouri's economy, and the state "needs to move forward with the growth area of the economy."

"Medicaid reform is a once-in-a-generation chance to reshape the state's health care future," he said. "This debate shouldn't be about ideology - it's about common-sense leadership for the state of Missouri."

Gov. Jay Nixon believes the General Assembly can "prevent further damage to our economy and put the needs of Missouri families first."

"By expanding and reforming Medicaid, we can reverse these harmful job cuts, stop the flow of Missourians' tax dollars to other states and bring affordable health coverage to hard-working Missouri families," Nixon said Wednesday in a news release. "Missourians deserve action now. It's time to move forward."