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Damages from Medicaid Politics Won't Stop at Hospitals

John Commins, for HealthLeaders Media, July 3, 2013

The Missouri General Assembly has declined to expand the Medicaid roles until state Senate and House review panels can issue a report. Zechman says he doesn't see that happening for at least six to nine months. As a result, hospitals in Missouri are bracing for a triple-whammy:

  • They're the recipients of a 2% reduction in Medicare reimbursements owing to the mandatory cuts brought on by sequestration.
  • Because their Medicaid roles won't expand, they will continue to treat a significant uninsured and indigent population with little hope of reimbursement.
  • The disproportionate share payments that are designed to offset charity care costs for hospitals such as OMC are being eliminated on Oct. 1 when the Medicaid expansion goes into effect.

"We are going to get that cut anyway even though Medicaid expansion is not happening in Missouri," Zechman says. "The disproportionate share cut was made and it was anticipated that the hospitals would recoup that money back through expanded Medicaid and the insurance exchanges. The exchanges might get a little back, but we aren't going to get anything from the Medicaid expansion."

It's not just the hospitals and the vulnerable who will be hurt.  

A University of Missouri analysis commissioned by the Missouri Hospital Association estimates that the Show Me State will be shown that it could lose more than 9,000 jobs, $1.9 billion in reduced capital investment, or $1.1 billion in cost shifting to private plans with the decision not to expand Medicaid.  

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