Malloy Says Connecticut Legislature Must Act Again to Fix State Budget

Connecticut Governor Targets Hospital Funds To Close Budget Gap

Connecticut Gov. Dannel Malloy unveiled his budget to the legislature last Feb, merely the yr'due south expenditures were greater than income. Connecticut's leaders voted to cut infirmary funding to help close the gap. Jessica Colina/AP hide caption

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Connecticut Gov. Dannel Malloy unveiled his upkeep to the legislature final February, but the year'southward expenditures were greater than income. Connecticut'south leaders voted to cut hospital funding to assist close the gap.

Jessica Hill/AP

This calendar week Connecticut'south leaders had to shut a $350 million hole in the state's budget. One identify they cut is hospital funding, and that'south making hospital executives furious.

The battles lines are clear. Gov. Dannel Malloy, a Democrat, says the hospitals are getting rich off taxpayers, making more coin than in past years — thanks, in role, to the Affordable Care Deed. So he thinks hospitals can beget to give some coin back.

"If you make virtually a billion dollars a year, how bad are things?" Malloy asks. "If you're having the best results in recent history in hospital performance why do you need the citizens of Connecticut to give you lot an additional $500 million?"

Malloy is making his argument personal — taking aim at the high salaries of hospital CEOs. Many of the executives of the state's nonprofit medical institutions make at to the lowest degree a 1000000 dollars a year, he points out.

"If they're pain and so bad," Malloy says, "why are they paying their chief executives $iii.5 million dollars?" "

But where the governor sees bloat, the hospitals see a politician using them every bit easy targets. The medical institutions are paying for political-style advertizing to tell constituents that his cuts will take a serious, negative issue on patient care.

"Longer wait times, fewer cancer screenings, and nurses will exist let go," i ad says. "Tell Gov. Malloy to stop cutting our hospital care. Lives depend on information technology."

The hospitals say bringing up CEO pay is an irrelevant distraction. Cut it in half and you'd barely make a dent in the state's budget problem, they say.

Dr. John Murphy, who runs Western Connecticut Wellness Network, says there'southward a bigger problem — the governor is either misrepresenting infirmary economics, or he doesn't understand them.

"If you look at, how much coin did you actually make — operating income? If that's the number," Murphy says, "and information technology's a pure accounting number, we lost tens of millions of dollars last year." As for 2015, he says, "I'grand sure it'south worse."

The governor'due south staff sees the hospital's balance sheet differently. If lower-paid hospital employees and small programs are taking a striking because of the state cuts, Malloy's office argues the blame should be on infirmary boardrooms — not the state government. It's the board members who are prioritizing executive salaries over other financial needs.

This public fight betwixt the state and its medical institutions is playing out largely considering of what the hospitals say is a broken hope.

In 2012, the state of Connecticut implemented a new infirmary tax. The hospitals would pay around $350 one thousand thousand a year to the state, and all of that money — if not more — was supposed to be returned to them as Medicaid payments.

Merely that was then. Until Tuesday, the land budget was out of balance. To help set up it, Malloy wanted to cut another $63 million to hospitals; lawmakers put about half of that dorsum. But the numbers still seem out of whack to Patrick Charmel, the CEO at Griffin Infirmary, an independent nonprofit in Derby, Conn.

"So, now nosotros're talking over half a billion dollars," Charmel says. "That's what hospitals are paying in terms of the revenue enhancement. And, substantially, we're not getting whatsoever of that back."

He thinks hospitals have cut all they tin, despite what Malloy thinks.

"When there'southward a cut in land payments to hospitals or federal payments to hospitals, it's got to come out of intendance commitment," Charmel says. "There'due south nobody else to shift it to."

Medicaid is lurking in the background of the word. The state says more than people than e'er are getting Medicaid, and Medicaid payments to hospitals have more than doubled in 10 years.

But don't tell that to Potato. Hospitals lose about threescore cents on every dollar of Medicaid service, the infirmary CEO says. "The fact that nosotros're getting more Medicaid patients to take intendance of, and on every one of them nosotros accept financial challenges associated with that care — it really isn't a windfall for united states of america," Murphy says. "In fact, it's a greater economical burden."

While this yr's budget may exist back in balance, the hospitals are gearing up for a long-term fight. They want the tax ruled invalid — a motion that could accept the fight from the capitol to the courtroom.

This story is function of NPR's reporting partnership with WNPR and Kaiser Wellness News.

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Source: https://www.npr.org/sections/health-shots/2015/12/12/458750280/connecticut-governor-targets-hospital-funds-to-close-budget-gap

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