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Rural hospitals across Tenn. face uncertain future

December 2nd, 2013 8:44 am by Staff Report

Rural hospitals across Tenn. face uncertain future

NASHVILLE, Tenn. (AP) — Tennessee's rural hospitals are laying off workers and reducing services as they try to cope with the funding changes brought about by the Affordable Care Act and the political battles that surround expanding TennCare.

The Tennessean reports the federal health law reduces reimbursements to Tennessee hospitals by $5.6 billion over the next 10 years. That money was supposed to be replaced through expanding TennCare, the state Medicaid program.

But Republican leaders in the state legislature oppose expansion, saying they doubt the federal government will stand by its obligation. Gov. Bill Haslam has been trying to design a framework that will satisfy both the Obama administration and fellow Republicans.

The Tennessee Hospital Association lobbied unsuccessfully for expansion last year. Now it is organizing a grassroots campaign to fight for expansion.

Randy Davis was promoted to chief executive officer at NorthCrest Medical Center in Springfield on Oct. 1.

About two weeks later, he issued a press release when vacation accruals were temporarily suspended.

"I need the realization of this community, and of Middle Tennessee, and the entire state, and of anyone who will listen that this is real," Davis said. "This has real impact. It is serious. Even indecision and passivity are dangerous. It comes at a real cost. That is the human cost."

While layoffs at Vanderbilt University Medical Center and Saint Thomas Health have generated news stories, the smaller but steady trickle of job losses at rural hospitals has gone largely unreported.

Capella Healthcare has eliminated positions at its hospitals in McMinnville, Sparta, Woodbury and Smithville.

Davis said NorthCrest has had to let go of several workers. It may also sell off some real estate to beef up cash reserves, but that's only a short-term fix.

"There has to be an end in sight," Davis said. "There has to be something that gives. It's a matter of can you hang on for that one or two years of purgatory while waiting for all this stuff to work itself out."

Maury Regional Medical Center is losing $10.7 million a year because of the federal health law, the impact of sequestration and other budget cuts. Wayne Medical Center is losing $807,000 a year. Marshall Medical Center is losing $257,000.

Tom Gee, CEO of Henry County Medical Center said the hospital reduced its workforce by 25 positions in October. Gee is contemplating whether to stop offering oncology services and to ask the county to pick up the costs of ambulance services.

Gee said financial problems exacerbated by political conflicts over the health law offer the most serious threat to the hospital he has seen in his 23 years at the helm.

"Our future survival is heavily dependent on expansion of Medicaid and signing people up in the health exchange," Gee said. "That's the only place we're going to replace the lost volume and lower reimbursements we're seeing right now."

Craig Becker, president of the Tennessee Hospital Association, said he expects hospitals to cut back on birthing services, oncology programs and specialized trauma services to reduce costs in the short term.

Becker said Tennesseans already are paying for Medicaid expansion in the form of new federal taxes tied to the health care law.

"Those dollars are leaving the state, and nothing is coming back for it," Becker said.

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Information from: The Tennessean, http://www.tennessean.com

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