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  • Staff file photo
    St. Joseph Hospital in Nashua.
  • The emergency room and ambulance bays at Southern New Hampshire Medical Center were revamped in 2005. Staff photo by Bob Hammerstrom
Thursday, September 8, 2011

State’s response to hospitals’ suit due soon

CONCORD – The parties on both sides of a federal lawsuit over state funding of hospitals hope to have their first court clash early next month, according to documents filed in federal court.

Ten hospitals, including Southern New Hampshire Medical Center and St. Joseph Hospital in Nashua, filed suit in U.S. District Court in Concord early this summer, claiming the Legislature’s plan to cut so-called “disproportionate share” program payments to hospitals is illegal because it makes non-Medicaid use of Medicaid money.

In court documents posted online, the hospitals and state Department of Health and Human Services Commissioner Nicholas Toumpas agreed that Toumpas will file his reply to the suit on Sept. 23.

Both sides also asked the court to schedule a hearing on the hospitals’ request for a preliminary injunction for Oct. 5, according to the documents.

Toumpas is being represented by state attorney general’s office lawyers Suzanne Gorman and Laura Lombardi, according to court documents.

The disproportionate share payments are part of a 2-decade-old program under which the state reimbursed hospitals for a 5.5 percent Medicaid Enhancement Tax, also called the bed tax.

Those tax payments were made to the state so the federal government would pay a one-to-one match to the state. Once that federal match was received, the state reimbursed hospitals via the disproportionate share payments.

This year, to help make up an $800 million budget shortfall, the Legislature decided to collect the bed tax and get the federal matching payments, but not reimburse hospitals.

Many other cuts to state and local agencies and programs were part of that plan.

The numbers involved are huge: Hospitals will lose about $230 million over the two-year budget. The cuts have triggered significant layoffs at local hospitals, among others around the state.

Several hospitals statewide, including Nashua’s two hospitals, have laid off hundreds of employees and cut a series of departments and programs. SNHMC and St. Joseph each have to come up with about $10 million this year because of the cuts, according to hospital officials.

Joseph G. Cote can be reached at 594-6415 or jcote@nashuatelegraph.com. Also, check Cote out on Twitter (@Telegraph_JoeC).