Friday, October 5, 2012

Hospital officials ask county for $277,000 in Medicaid ‘seed’ money

Moab Regional Hospital officials have formally asked the Grand County Council to assist them with the hospital’s financial woes by providing “seed money” to help MRH receive at least $840,000 in supplemental Medicaid payments for the current year.

When Moab Valley Healthcare, Inc., a non-profit organization, took over ownership of Allen Memorial in 1995, the hospital was grandfathered into the DSH fund, even though it was no longer district owned, because it was still located in the same building. Because Moab Regional Hospital is in a new location and not owned by or affiliated with any governmental entity, state Medicaid officials determined that the facility was no longer eligible for participation in the supplemental DSH program.

The hospital subsequently challenged the disqualification, and officials were able to work out a compromise that would allow them to continue to participate, on the condition that a governmental entity agrees to sponsor or support the hospital by paying approximately 30 percent of the total DSH payments being applied for as up-front “seed” money. For 2012, the amount of seed money needed is approximately $277,000.

In May, the new hospital discovered that some $1 million in cash reserves were depleted to the point that officials were forced to choose between paying employees or paying the facility’s mortgage. The choice to pay employees meant that the mortgage payment was late, prompting the U.S. Department of Housing and Urban Development (HUD) to get involved. HUD provides the insurance on the hospital’s mortgage loan with U.S. Bank, Barraclough told The Times-Independent last month.

Council member Audrey Graham noted that since the DSH program is ongoing, the seed payment would not just be a one-time event. The county would possibly have to impose a sales tax increase – perhaps as high as 0.5 percent – to cover the cost of making the DSH seed money payments in future years and to help provide extra funding for the Canyonlands Care Center, she said.

The sales tax issue could be placed on the June 2013 ballot if the Grand County Council approves the measure. MoabTimes-Independent