Idaho hospitals might face significant challenges due to a 4% Medicaid reimbursement cut. On September 1, hospitals that charge Medicaid for services will receive 4% less in reimbursement.
This reduction could affect services for all patients, not just those on Medicaid, according to Toni Lawson, Vice President of the Idaho Hospital Association.
Lawson explained that even a slight cut could mean the difference between financial stability and loss.
“4% translates to even the littlest bit, could mean the difference between operating in the red and operating in the black,” Lawson said.
Operating in the red means losing money, and Lawson mentioned that many Idaho hospitals are closer to this situation than people realize.
“You know at any given time, half the hospitals in Idaho are operating with a less than 1% margin,” Lawson stated.
A 4% cut would push more hospitals into financial jeopardy, forcing them to use vital reserve funds. Once these funds run out, hospitals would need to evaluate cost-saving measures.
“They’re going to have to start looking at what service lines aren’t covering themselves in terms of expenses and costs,” Lawson said.
Programs that are too costly might face cuts, she explained.
“The most vulnerable services that you may see some more closures are labor and delivery services and behavioral health services,” Lawson added.
These services often run at a loss but hospitals still perform the services because they are essential to the community, Lawson explained.
She also emphasized that without funding from other areas, these crucial services could experience cutbacks and closures.
“These are pretty tough decisions that I think our hospitals are going to have to make, particularly our small rural hospitals,” Lawson said.
Although Lawson hopes the 4% reimbursement cut is temporary, it could lead to difficult decisions for hospitals.
Non Stop Local did reach out to The Idaho Department of Health and Welfare, they asked for specific written questions to send a written response. As of Tuesday afternoon, a written response was not sent. KHQ