Funding cuts would damage hospitals

We are deeply concerned and distressed that the Legislature is once again debating additional Medicaid cuts to hospitals. The latest round of cuts proposed — totaling more than $60 million per year — is unsustainable. More importantly, they are unnecessary.

We manage four hospitals in the relatively small Maine communities of Bridgton, Rumford, Norway and Farmington. We cover the territory from the Sebago Lakes region to Sugarloaf and all points west to the New Hampshire border.

Our hospitals help provide the backbone of health care in rural Maine. We employ thousands of Mainers and are among the largest employers in Franklin and Oxford counties. Together, we provided approximately $4 million worth of free medical care to members of our communities.

Four years ago, when the Medicaid program was not as stable as it is today, the Legislature cut Medicaid eligibility — disenrolling tens of thousands of people, raised taxes on hospitals and cut hospital reimbursement. Those were difficult decisions for the Legislature to make and even more difficult for our hospitals to absorb.

As a result, Maine’s 36 hospitals have received $70 million less per year from Medicaid compared to four years ago.

However, care and expenses for treating patients on Medicaid have not declined during that period. In fact, the pharmaceutical costs that hospitals incur in treating individuals on Medicaid have increased more than 25 percent during the same four-year period.

Thanks to a lot of hard work by hospitals and others, the Medicaid program is now financially stable. An example of that hard work involved a partnership with the Department of Health and Human Services which oversees the Medicaid program.

DHHS asked hospitals to participate in an effort that sought to help those individuals who used hospital emergency rooms most frequently; some as often as two to three times per week. These folks didn’t need to be at the ER, but they did need services and didn’t know where else to go.

Hospitals responded and helped DHHS get these individuals the services and support they needed in order to avoid going to the emergency room. This saved the state budget $20 million in avoided ER costs. That savings, though, was a financial loss to hospitals. It’s the irony of modern health care — doing the right thing often involves losing money.

Now, because of many efforts like that, there are no longer annual budget crises in Medicaid. Furthermore, the state’s tax revenues are growing and are enough to balance the budget.

Hospitals, however, are not in a stable condition.

Three of our four hospitals lost money last year. In fact, statewide, more than 50 percent of Maine hospitals ended their year in the red. The state can’t merely be interested in its own bottom line; policymakers must consider the impact of their actions on hospitals, patients and health care, too.

Yet, the two-year state budget being debated in Augusta once again proposes massive cuts to hospitals. The budget raises the hospital tax, cuts reimbursement to primary care doctors and to safety net hospitals known as “Critical Access Hospitals.” Bridgton, Rumford and Stephens Memorial Hospital are Critical Access Hospitals.

These proposals are senseless and the cuts simply can’t be absorbed. In fact, it’s time that policymakers reversed the cuts hospitals have had to deal with since 2012.

Members of the public need to understand that more cuts from the state will result in significant harm to our hospitals and local access to services that hospitals alone provide.

Finally, as you probably know, the federal government is currently debating legislation that would partially repeal and replace the Affordable Care Act.

The ACA was designed in such a way that it cut hospitals’ reimbursement in order to finance programs to expand access to insurance for lower income Americans. That expanded access helps hospitals by reducing the amount of free care we provide. While it has never worked perfectly, there was a degree of balance for hospitals in terms of costs and benefits.

None of us knows what the final repeal and replace legislation will look like. But, the early indications are that all of the ACA cuts to Maine’s hospitals will remain; the offsetting expanded insurance coverage benefits are in doubt.

It’s not the state Legislature’s job to immunize hospitals from pain inflicted by Congress. However, it is the job of state policymakers to avoid needlessly making things worse.

The fact that lawmakers in Augusta are even debating another round of multimillion dollar cuts to hospitals when there is no Medicaid crisis and no revenue crisis troubles us greatly. Those cuts shouldn’t even be on the table.

Fortunately, several local legislators are in a position to help. Rep. Frances Head (Bethel) and Sen. Eric Brakey (Androscoggin County) are on the Health and Human Services Committee, which is currently looking at the budget. Sen. Jim Hamper (Oxford County) and Reps. Tom Winsor (Norway) and Jeffrey Timberlake (Turner) are on the Appropriations Committee and will review the budget in depth later this spring.

To each of them and their colleagues, we are asking, please — no more cuts to Maine’s hospitals.

David Frum is president and CEO of Bridgton Hospital and Rumford Hospital. Timothy Churchill is president and CEO of Western Maine Health and interim president and CEO of Franklin Community Health Network.