After protests from hospitals and lawmakers, Gov. Dannel P. Malloy’s budget office said Friday that it would repeal a portion of its $63.3 million in emergency budget cuts to hospital Medicaid programs — but only for six small hospitals, the Office of Policy and Management said.
The state will return a total of $14.1 million to Bristol Hospital, Day Kimball Hospital in Putnam, Griffin Hospital in Derby, Johnson Memorial Hospital in Stafford Springs, Charlotte Hungerford Hospital in Torrington, and Milford Hospital.
That figure includes approximately$9 million in federal matching funds. The $63.3 million cut in state funding balloons to approximately $192 million, when matching federal funds are counted. (See PDF at bottom of story)
The funding is being reinstated for the final three quarterly payments under the state’s small hospital pool program, which was established in the recent legislative session.
The pool is for hospitals with fewer than 160 beds that are not part of a larger hospital group or in contiguous communities.
OPM’s restorations did not include any givebacks of the largest portion of the emergency Medicaid cut — $59.7 million from the supplemental payment pool, which partially reimburses hospitals for a state tax implemented in 2011.
An additional $121 million in federal matching funds is tied to that larger program, which pays money to nearly every one of the 29 acute care hospitals in the state.
Between the small hospital and supplemental pools, the six smaller hospitals are getting back approximately 68 percent of the funding they had been slated to lose.
Since the cuts were announced in mid-September, the Malloy administration has sparred with hospitals, Republicans, and even some members of his own party about the hospital cuts, which Hartford Healthcare blamed for its recent decision to scuttle a planned acquisition of Day Kimball Hospital in Putnam.
To deflect criticism, Malloy has repeatedly pointed to hospital executive salaries and operating surpluses, particularly at larger hospitals. Hospitals have pushed back against that reasoning, arguing that they need positive margins to reinvest in their operations.
Malloy’s budget director, OPM Secretary Benjamin Barnes, continued to take that approach in a statement Friday.
“We know that hospitals are not one-size-fits all, and that’s why we’re proactively reprioritizing and reallocating dollars to support small hospitals that need support most,” Barnes said. “To be clear, hospital systems are seeing extraordinary revenues, but today we’re working to reprioritize and reallocate payments so we can assist the small hospitals and support patient care.”
Reacting Friday to the partial funding restoration, state Republicans said a special legislative session is still needed to fix the budget.
Relations between Malloy and hospitals have soured in recent weeks.
The Connecticut Hospital Association released a statement Friday calling the partial restoration “a political smokescreen to cover up and divert attention from the devastating $190 million in cuts he unveiled two weeks ago.”
“Let’s be clear: This is a Band-Aid on a bone-deep wound,” CHA CEO Jennifer Jackson said. “The people of Connecticut understand what the Governor is doing, and won’t stand silently by while the Governor harms patients and undermines Connecticut’s healthcare system.”
Republicans also continue to attack.
“Gov. Malloy is finally offering some temporary respite for our community hospitals as Republicans have been calling on him to do, but this token action does nothing to restore critical Medicaid funding for services to the poor or address the long-term funding of our health care system,” House Minority Leader Themis Klarides, R-Derby, said Friday.
Several Democrats praised the funding restoration Friday. Among them was Deputy Speaker of the House Linda M. Gentile, whose district includes Griffin Hospital.
“I’m grateful to Governor Malloy for restoring these funds which in turn, provide critical services and public safety for Ansonia and Derby residents,” Gentile said. “Griffin Hospital is our largest employer, so a stable job situation for employees is vital.”
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