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Rural Hospitals Wary Of Florida's Budget Proposal

MGN Online

Rural Hospitals are having trouble providing health care to their patients, and officials say the Florida Legislature’s budget plan isn’t likely to help.

Tom Stone is the Chief Executive Officer of Doctor’s Memorial Hospital in rural Perry, Florida.

“We admit about 1,400 patients a year into a hospital, and over 12,000 ER visits a year,” Stone says.

It may not seem like a large workload, but when the administered funding is significantly less than the cost of providing healthcare to patients, it can take a toll.

Stone says rural hospitals like his are frequently underfunded.

“Between 2015 and 2017, we were paid approximately $2.5 million less than the cost of what the care to provide to those patients cost us. Our cost is about 42 cents on the dollar, and we were getting reimbursed about 20 to 21 cents on the dollar,” Stone says.

The reason for the lack of funding is the cutbacks Florida lawmakers have made on Medicaid.

It varies by Hospital, but nearly half of rural patients rely on government plans like Medicare and Medicaid.

Last year, Florida’s Legislature cut $521 million from Medicaid funding—$11.4 million affected rural community hospitals. Furthermore, additional federal funds that the state expected did not come to fruition.

Stone says this has strong-armed many hospitals into cutting specific programs. DeSoto Memorial Hospital recently closed its maternity care services due to these budgetary restraints.

“We’re significantly being underpaid for the service we provide. Some would argue: ‘Well, that’s the institution’s problem,’ but Medicaid is a program we’re mandated to participate in, and to provide that care to patients. So, if we’re going to stay in business, exist in our communities, support our communities, be a pillar from an economic standpoint. We can’t afford to take losses like that,” Stone says.

But, Rep. Jason Brodeur (R-Sanford) argues the issue rural hospitals are facing is their rural nature.  

“You know, one of the challenges that rural hospitals have is the fact that they are rural. So, if you see a decline in the number if people going there, that is going to put any business in trouble,” Brodeur says.

On top of that drop in patients, many rural hospitals also face the issue of providing care to uninsured patients who may not be able to afford the care they receive.

That is one reason hospitals are wary of the state’s budget plan. The Senate’s proposal offers $50 million in new funding for hospitals to balance last years cuts. But, the House’s budget plan would include an additional $2.9 million cut to rural hospitals.  

Bruce Rueben is the President of the Florida Hospital Association. He says the House’s budget continues the trend of underfunding.

“The House proposal basically is used as a tier formula, identical to the one used last year. And, it does not include the 50 million in non-recurring revenue that was applied last year. So, the total cut is a lot higher, at 651 million, than it was last year,” Rueben says. 

Sen. Anitere Flores (R-Miami) says she cannot say for sure what the funding difference for rural hospitals will be between the House and the Senate, but admits it will come down to what the leaders of both chambers agree on during budget negotiations.