Rural hospitals may have to repay Medicaid millions


Sixteen rural hospitals in New York State could wind up on the hook to repay Medicaid as much as $20 million.

That has prompted U.S. Sen. Chuck Schumer, D-N.Y., to campaign on behalf of rural hospitals in the Empire State to obtain waivers of any payments, the Olean Times Herald reported.

The repayments are connected to changes in formulas for determining Medicaid payments to rural facilities, according to the newspaper. The Small Community Hospitals Program and the Medicare Dependent Hospitals program provide supplemental funding to rural facilities, and they can apply for adjusted payments if their volumes decrease by more than 5 percent in a year. But the Centers for Medicare & Medicaid Services recently made changes to the volume decrease payment formula for fiscal 2013, resulting in some recoupments.

“I care about our rural hospitals and they have a burden, so I always try to go to bat for them,” Schumer told the Times Herald. “This idea of clawing back money that they don’t have would hurt the patients here. It would hurt all the people.”

Among those facilities that may have been overpaid under the new formula is Jones Memorial Hospital in Wellsville, N.Y., which may have to repay more than $400,000.

Jones Memorial Chief Executive Officer Eva Benedict told the newspaper that the repayment would not be likely, as funding is limited and such a large repayment would force the hospital to postpone purchasing needed equipment. “Our checkbook is not that deep. Our well is not that deep,” she said.

Many rural hospitals are already under tremendous financial pressure. A study by iVantage Health Analytics released last year concluded that nearly 13 percent of rural hospitals nationwide are at risk for closure, putting some 86,000 jobs in rural communities at risk. Some facilities are being forced to cut back on services considered vital to rural communities, such as labor and delivery units, prompting pregnant residents to travel further for services.