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Tuesday, June 5, 2012

Feds give state 30 days to show budget cuts haven’t impacted medical access

CONCORD – Federal officials could put New Hampshire on a new treatment plan if the state doesn’t show its Medicaid program to be in good health.

Officials from the federal Centers for Medicare and Medicaid Services have given the state Health Department 30 days to prove that access to medical coverage has not been diminished for Medicaid patients due to recent budget cuts.

Last year, state legislators cut more than $230 million from state Medicaid payments, forcing a wave of layoffs and program cuts at the state’s eight largest hospitals.

Hospital administrators, who have waged a lawsuit in federal court, have complained in the months since that the cuts have reduced medical access for Medicaid patients, typically the elderly and disabled. And the federal health officers are looking to see if they need to intervene.

“Over the past several months, (the centers have) received and shared with you information that strongly suggests New Hampshire’s Medicaid program may have access issues for physician services and home health services,” Cindy Mann, director of the Medicaid center, wrote May 23 in a letter to health Commissioner Nicolas Toumpas. “If the State is unable to provide a demonstration of access in this time period, CMS will meet with you to discuss next steps.”

In a response letter issued last week, Toumpas disputed the Medicaid center’s allegations. Despite the budget cuts, state officials have provided sufficient data and evidence to show that access to medical services have not been affected, Toumpas wrote in a June 1 letter.

“This information clearly demonstrates that there has not been, currently is not, nor will be any evidence of a barrier to access to Medicaid recipients in New Hampshire,” he wrote. “New Hampshire will ensure continued access to care for its Medicaid recipients while moving forward with plans to restructure the … Medicaid system under a managed care model.”

Neither the CMS letter nor Toumpas’ response outline specific steps or consequences should the federal agency determine more action is necessary. Most often, federal officials work with states to develop a corrective plan to increase access.

In the letter, Mann does reference 42 CFR, a regulation that allows the federal government to withhold payments to states that do not comply with federal requirements.

Last year, New Hampshire took in $806 million in federal Medicaid payments, compared to $615 million covered by the state, according to federal records.

“It’s a game of chicken, and it’s unfortunate,” said Tom Scully, former administrator of the federal medicare center, who oversaw a similar situation with Missouri during his time in office.

“New Hampshire has effectively cashed out,” Scully said Monday. “For all intents and purposes, it’s not putting up one penny more for the Medicaid program.”

Across the country, federal reimbursements cover 50 percent of Medicaid costs, so without the state funding, New Hampshire hospitals are left struggling to make up the difference themselves, administrators said.

State job counts show that hospitals have lost 200 since June 2011 when lawmakers approved the budget, but the New Hampshire Hospital Association contends that hospitals have shed more than 1,000 jobs since then.

Locally, St. Joseph Hospital in Nashua laid off 174 employees last year and terminated contracts with a private ambulance service and a medical equipment company.

At Southern New Hampshire Medical Center, officials stopped taking new Medicaid clients for outpatient services. They also reduced the hospital’s 18-bed psychiatric unit to 10 beds, leaving about 230 Medicaid patients to seek treatment elsewhere over the year, according to Dr. Philip Sullivan, director of the hospital’s behavior health center.

“We want to care for these patients,” Sullivan said Monday. “Certainly, in my job as a psychiatrist … I want to provide care for them, but the hospital had to make a strategic financial decision based on the lack of funding.”

Looking forward, hospital administrators are hopeful that the federal government could help them gain ground in their fight to restore the Medicaid funding.

In the letter, Mann, the CMS director, offered to set a meeting with state officials and hospital administrators to better resolve the issue.

“It is of the utmost importance for DHHS to work collaboratively with CMS to resolve the issues and concerns,” Toumpas, the health commissioner, said in a written statement.

“The ultimate desired outcome is to get that funding restored, but at least this way, there will be a better dialogue,” added Sullivan, of Southern New Hampshire Medical Center. “So far, the situation has been a little adversarial. Hopefully, something good will come from this.”

Jake Berry can be reached at 594-6402 or