On Friday, the Louisiana Department of Health and Hospitals announced it will cut $859.2 million from the state Medicaid program for fiscal year 2013, which equates to roughly an 11 percent cut of the state's $7.7 billion Medicaid program.
That total includes $287.1 million in state general funds, which in turn leads to a loss in federal matching dollars and other Medicaid funds. The major Medicaid shortfall comes as Congress decreased Louisiana's disaster-recovery federal Medicaid assistance percentage — the special rate used for the federal government to dispense Medicaid dollars to states — from 71.92 percent to 65.51 percent. This particular FMAP is related to damage created by Hurricane Gustav.
"We built our budget based on the Medicaid matching rate published by the federal government," said DHH Secretary Bruce Greenstein. "While that rate has now changed, our focus remains on ensuring the people of Louisiana have access to quality healthcare services in the most effective, efficient and sustainable way possible. We are proud to say there will not be reductions to essential services."
However, several hospitals and providers will face enormous Medicaid cuts in FY 2013, particularly hospitals within the Baton Rouge-based Louisiana State University Health System. LSU Health System's overall budget for FY 2013 will be slashed 24 percent. LSU's disproportionate share hospital funds will be cut by $122 million, and DHH also said it will reduce the public hospitals' Medicaid reimbursement rates by 10 percent. LSU hospitals are considered to be among the state's largest safety-net providers.
Other rural hospitals will be particularly affected by Louisiana's announcement, as all separate DSH funding payments to rural hospitals will be eliminated. Although LSU hospitals and rural state hospitals will be losing millions in Medicaid reimbursements, the state said it "does not anticipate that eliminating DSH payments to rural hospitals will impact Medicaid recipients' access to care."
That total includes $287.1 million in state general funds, which in turn leads to a loss in federal matching dollars and other Medicaid funds. The major Medicaid shortfall comes as Congress decreased Louisiana's disaster-recovery federal Medicaid assistance percentage — the special rate used for the federal government to dispense Medicaid dollars to states — from 71.92 percent to 65.51 percent. This particular FMAP is related to damage created by Hurricane Gustav.
"We built our budget based on the Medicaid matching rate published by the federal government," said DHH Secretary Bruce Greenstein. "While that rate has now changed, our focus remains on ensuring the people of Louisiana have access to quality healthcare services in the most effective, efficient and sustainable way possible. We are proud to say there will not be reductions to essential services."
However, several hospitals and providers will face enormous Medicaid cuts in FY 2013, particularly hospitals within the Baton Rouge-based Louisiana State University Health System. LSU Health System's overall budget for FY 2013 will be slashed 24 percent. LSU's disproportionate share hospital funds will be cut by $122 million, and DHH also said it will reduce the public hospitals' Medicaid reimbursement rates by 10 percent. LSU hospitals are considered to be among the state's largest safety-net providers.
Other rural hospitals will be particularly affected by Louisiana's announcement, as all separate DSH funding payments to rural hospitals will be eliminated. Although LSU hospitals and rural state hospitals will be losing millions in Medicaid reimbursements, the state said it "does not anticipate that eliminating DSH payments to rural hospitals will impact Medicaid recipients' access to care."
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