Governor Reaches Agreement with Hospitals
Governor Reaches Agreement with Hospitals
Governor John Baldacci and the Maine Hospital Association (MHA) announced a plan to resolve outstanding MaineCare debt owed to Maine hospitals and to increase MaineCare hospital payments.
"I am pleased that we have been able to move forward in assuring appropriate payment to Maine's hospitals in a timely fashion," said Governor Baldacci. "We have a shared commitment to the people covered under the MaineCare program and to the providers who care for them."
This agreement compliments previous work undertaken by Governor Baldacci where he settled a longstanding lawsuit filed against the state in 1993 regarding MaineCare reimbursement rates.
"As caregivers, hospitals know how important this program is to ensuring that the neediest Mainers, both children and adults, receive the care they need when they need it," said MHA President Steven R. Michaud. "MaineCare must be preserved to ensure the health of our most vulnerable citizens."
Importantly, because of the federal government's commitment to share in the costs of state Medicaid programs, this agreement will result in approximately $347 million in federal Medicaid matching money flowing to Maine to support our healthcare system. With the State fulfilling its obligations under the MaineCare program through this agreement, it will improve the affordability of healthcare and health insurance for everyone.
The Baldacci Administration intends to pay the remaining state share of the debt of $204 million in equal installments over the next four years. The State will look at any potential revenue surplus as a means of making payments early, in addition to budget funding.
Governor Baldacci added: "Hospitals have been working with us since I took office to continue to provide service for all Mainers. With this latest settlement, Maine's community hospitals along with other front line providers will be able to maintain their mission to provide the highest quality healthcare to all those in need."
In the agreement with MHA, the Governor's office has agreed to pay off the debt and avoid accumulation of debt in the future. According to the agreement:
The state will raise hospitals' weekly PIP payments by including $82 million in state funds ($221 million state and federal) for hospitals in state fiscal years 2008 and 2009.
Also during fiscal years 2008 and 2009, the state will include $20 million in state funds ($54 million state and federal) to pay for 2004 hospital settlements.
A second $102 million in state money ($275 million state and federal) will be budgeted for fiscal years 2010 and 2011 to pay all remaining MaineCare hospital settlements.
"We applaud the Governor's hard work to come to this agreement with Maine's hospitals," Michaud said.
In addition, Governor Baldacci said he is pleased that the Maine Hospital Association has agreed to work collaboratively with the Administration to contain costs and overall expenditures related to providing service for MaineCare patients.