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SC Medicaid cuts may lead to hospital layoffs

The State, May 16, 2011

Providence Hospitals' announcement of 35 layoffs is a shot-across-the-bow warning of widespread healthcare job losses to come if larger cuts in state Medicaid reimbursements are enacted this summer, physicians and hospital officials say. Until the state Legislature approved a change in April, South Carolina was the only state that did not allow its state Medicaid agency to cut the rates that it paid to hospitals and physicians to treat the poor and disabled. With its new power, the S.C. Department of Health and Human Services cut the Medicaid reimbursement rate by 3%, a move expected to save the state $6 million by the June 30 end of the state's fiscal year. The state agency plans an additional 7% cut, designed to save $125 million annually, starting July 1.