Clip files / Local news from the states

This column features selected short items about state health care policy.

Hospitals' revenue to start being taxed

JACKSON, MS — All hospitals' revenue in Mississippi will be taxed to shore up a $360 million budget shortfall in the Medicaid program. Medical directors warn that staff and services will be cut as a result. "It will diminish the health care available to our citizens," said Gerald Wages, executive vice president of North Mississippi Medical Center in Tupelo. "A sizable number of hospitals are operating at a deficit."

The tax will cost the northeast Mississippi system's five hospitals $9.5 million out of about $18 million profit margin last year, said Mr. Wages, chairman of the state hospital association. In June 2005, the federal government told the state to stop a previously approved accounting tactic that pulled in more federal money for the program. The result is a $360 million gap in funding that lawmakers did not address in this year's legislative session because they were not told.

Medicaid will charge about 1.5% assessment on all hospitals' gross revenues. Currently, only public hospitals pay the assessment, which is about 0.35%. "We believe this action must be taken to ensure Mississippi hospitals do not lose $360 million worth of net revenue in the future," Medicaid executive director Robert Robinson wrote to hospitals in June. The plan is to shift some burden from public facilities to all hospitals, said Pete Smith, Gov. Haley Barbour's spokesman.

But Dan Harrison, executive vice president of Rush Health Systems in Meridian, said the tax is unfair because it charges hospitals for revenue that was never in the bank.

Indigent care, Medicaid, and Medicare rarely pay for the actual cost of services, so hospitals lose almost 50% of gross revenue, he said. Facilities usually write this loss off at tax time. The planned tax would charge hospitals for the full cost of services, no matter if the client paid or not, he said.

— Jackson Clarion/Ledger, 6/27/06

New law orders coverage for 4,000 more WV children

CHARLESTON, WV — Although West Virginia Gov. Joe Manchin signed a bill to expand health insurance to an estimated 4,000 West Virginia children, he wanted to delay making a decision about expansion until Congress reauthorized the Children's Health Insurance Program (CHIP) — something that is not expected to happen until next year. Manchin aide Brian Kastick asked for the delay during a meeting of CHIP's board of directors. Gov. Manchin believes it is unwise to expand the program until state officials know how much Congress will commit to it, Mr. Kastick said. "He's not against expanding the program," Mr. Kastick said. "He just doesn't want to spend money we don't have."

CHIP board members voted to put off a decision and to seek legal advice. They have to decide whether the law requires them to expand coverage or whether they can delay indefinitely. Gov. Manchin believes the board legally can wait until next year or longer, said spokeswoman Lara Ramsburg.

House Speaker Bob Kiss, D-Raleigh, disagreed. He said a delay of more than a couple of months could cause legal problems for the governor. "They just can't sit on their hands and not expand it for several months or a year," Mr. Kiss said.

The state's CHIP insures about 26,000 low-income children whose parents make too much money to qualify for the Medicaid program. The federal government pays about 80% of the cost and state taxpayers pay the rest. Earlier this year, the Legislature passed a bill (HB 4021) to expand coverage to children whose families earn 300% of the poverty level, up from 200% today. The families of new CHIP recipients would be required to pay premiums and might not receive the same level of services as poorer children, the bill said. At the bill signing in April, Gov. Manchin touted the CHIP expansion as part of his effort to cover the uninsured.

"If you're a child now in West Virginia, since we've raised the bar to 300% of the poverty level, and that's 95% of the children in West Virginia, you have some form of health care called the CHIP program," Gov. Manchin said.

—Charleston Gazette, 6/30/06

San Francisco's supervisors expand health coverage

SAN FRANCISCO — The San Francisco Board of Supervisors gave initial approval to a plan to extend health care coverage to the uninsured by opening up and expanding the city's system of physicians and clinics now serving poor city residents. The plan, a merger of proposals put forth by supervisor Tom Ammiano and Mayor Gavin Newsom, would go into effect next year, provided it passes a second board vote and is signed into law by Newsom — both considered virtual certainties. "We want to put health care on the front burner," Mr. Ammiano said, just before the unanimous 11-0 board vote in favor. "We are well on our way to that admirable goal."

The key political compromise that led to passage was an agreement between the mayor and the more liberal Board of Supervisors majority that city businesses be required to contribute to health care coverage for their employees. It would require businesses and other employers to pay $1.06 or $1.60 per hour per worker, depending on the size of the company. The balance of the estimated $200 million annual cost of the program would be covered by consumer premiums and copayments and by the $104 million a year San Francisco already spends on providing care to uninsured patients at city clinics and hospitals.

City Health Director Dr. Mitch Katz has said he foresees a system that emphasizes preventive medicine in which uninsured residents join or are enrolled by their employers, are assigned a primary care physician and have access to a network of specialists and hospitals.

San Francisco Chronicle, 7/19/06

3 Arrested in Katrina Hospital Deaths

NEW ORLEANS — A doctor and two nurses have been arrested on suspicion of second-degree murder for allegedly administering lethal drugs to patients at a hospital while it was marooned in Hurricane Katrina's floodwaters without electricity or running water. The hospital, Memorial Medical Center, was emblematic of the near-total breakdown of New Orleans' emergency and health care systems after rising water breached the levee system Aug. 29, 2005. Scores of employees stayed at the hospital and struggled to care for hundreds of stranded patients as the electric generator died, rescue efforts stalled and temperatures soared above 100 degrees. When substantial help arrived six days later, 41 patients were dead.

The circumstances may have been dire, but Louisiana Atty. Gen. Charles C. Foti Jr. — whose office made the arrests — suggested that the suspects deliberately crossed an ethical barrier. The documents released by Foti's office included dramatic accounts by purported eyewitnesses to the alleged fatal injections.

"We're talking about people who pretended that maybe they were God," Foti said at a news conference in Baton Rouge. "And they made that decision. This is not euthanasia. It's homicide."

The suspects, Dr. Anna Pou, 50, and nurses Lori L. Budo, 43, and Cheri A. Landry, 49, were arrested Monday and released on bail. Each is charged with injecting four patients with a deadly cocktail of morphine and the drug midazolam, also known as Versed.

Los Angeles Times, 7/19/06