MassHealth cap could slash hospital reimbursements by $150M
Massachusetts hospitals have long maintained they get shortchanged by state government when they treat MassHealth patients. Now they say it's about to get worse.
A proposed MassHealth policy set to take effect Oct. 1 that will reduce reimbursements to hospitals by $150 million represents a "massive cut" to hospital budgets, and amounts to state government interfering with negotiations between hospitals and MassHealth managed care organizations over rates that cover patient care, the Massachusetts Hospital Association asserted in its weekly "Monday Report."
The association is calling on the Baker administration to rescind its proposal and not include it in its upcoming Medicaid contract with hospitals.
The Executive Office of Health and Human Services proposal would ban MassHealth managed care organizations from reimbursing hospitals more than 105 percent of the MassHealth fee for service rates paid for hospital services. The hospital association said hospitals are already paid 76 cents for each dollar of care provided under the existing fee for service rates, so the cap "would result in hospitals being paid 20 percent below the cost of care."
MassHealth is the largest program in the state budget and the largest insurer in Massachusetts. The Baker administration is looking for ways to control growth in MassHealth spending, which is devouring available revenues especially with tax revenue growth limping along despite the prolonged economic recovery.
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