Medicare, Medicaid Cuts Will Hurt Hospitals In North Carolina

5:23 PM, Jul 15, 2011   |    comments
  • Carl Martin, Morehead Hospital CEO
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Eden, NC-- A Triad hospital is hoping America's lawmakers reach a deal soon on the debt ceiling.

However, they don't want just any deal, because of the affect it may have on patients.

Staff at Morehead Memorial Hospital in Eden, said they could lose more than $1 million in cash, if the Obama Administration and Congress cut Medicare and Medicaid funding, in a deal to raise the debt ceiling.

The President and Congress are considering massive cuts in hospital payments for service to Medicare and Medicaid patients, according to the hospital's CEO. These cut would cost North Carolina hospitals $671 million.

Medicare and Medicaid are government insurance programs that cover about two-thirds of patients in North Carolina hospitals.

Medicare and Medicaid payments account for about 65.5% of Morehead Memorial Hospital's revenue. Hospital President and CEO W. Carl Martin said the estimated impact of the proposed cuts to Morehead is $1.1 million.

He is urging citizens to contact their Congressional representatives and tell their leaders not to cut Medicare and Medicaid.

"The downturn in the economy has forced Morehead Memorial Hospital to reduce costs over the past two years by improving efficiency, consolidating management functions and reducing management staff where possible, and renegotiating contracts with suppliers and service partners," Mr. Martin said. "The next cuts may affect services. Some services may disappear, not just for Medicare and Medicaid patients, but also for everyone. Jobs may be lost and the local economy will suffer."

Morehead Memorial Hospital is the largest employer in the City of Eden and the fourth largest employer in Rockingham County. The hospital has 1,000 full- and part-time employees with an annual payroll of $40.5 million.

Medicare, the federal insurance program for the elderly, and Medicaid, the state-run, joint federal-state program for the poor, blind, elderly and disabled, already pay hospitals less than the actual cost of care.

"Where hospitals can shift Medicare and Medicaid cuts to the private sector, health insurance premiums will rise," Mr. Martin said. "Higher premiums will price more businesses out of offering coverage for their employees or force employees to pay more."

In an unusual step, the North Carolina Hospital Association (NCHA) is planning to purchase newspaper advertisements across the state seeking public help in protecting their access to healthcare. The ads will run in 18 county newspapers in nine non-urban Congressional districts.

"We seldom, if ever, do ads," said NCHA President Bill Pully. "But this threat has the potential to undermine the steps we've taken to remodel the healthcare system into one that provides higher quality at lower costs. Cuts like these would shape health care for the next decade in a way that will hurt our patients and our hospitals."

Morehead Hospital

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