A Gulf Coast hospital says it will likely sell its mental health services in light of reduced Medicaid payments. MPB’s Evelina Burnett reports.
Memorial Hospital at Gulfport says the state Medicaid agency started cutting mental health payments in 2013. Memorial CEO Gary Marchand says the hospital appealed the payment cuts. That was denied. It then asked for Medicaid tax exemptions. Also denied.
Earlier this year it sued, but Marchand says he expects that lawsuit to take several years. Meanwhile, the hospital says it’s underpaid about $10 million dollars a year by Medicaid.
"This mental health campus is about half of that underpayment, so it is unfortunately the largest block of loss that we can look that relates to the way Medicaid pays public hospitals," he says.
This comes at a time when the state Medicaid program is already hobbled financially, with a $50 million budget deficit last year alone. State Senator Brice Wiggins, chair of the Senate Medicaid committee, calls the continuing rise in Medicaid costs a crisis. It was one of the issues discussed at a legislative budget hearing last week.
"There's going to have to be some hard decisions made if we're going to be serious about it," he says. "And that could mean lessening provider reimbursements - that's not something I want to do. One of the things that was mentioned was optional services ... so as far as I'm concerned, everything is on the table if we're going to get serious about it. And the question is, does everybody want to get serious about it?"
Memorial says it will hire a consultant to help determine what to do next, including most likely a sale or long-term lease of the mental health operations. CEO Marchand says their two priorities are to keep the jobs and the services, which include everything from hospital stays to counseling.