South Carolina offers $15M to help hospitals change business model

The state of South Carolina offered $15 million to its hospitals to shift their business models away from filling empty beds toward something more stable for the long run, the Charleston Post and Courier reported.

"One of the biggest problems that hospitals have is that the average occupancy is 60 percent," South Carolina Medicaid Director Tony Keck told the Post and Courier. "And so hospitals have a lot of excess capacity in a time when admissions are going down even further."

Some facilities, such as Allendale County Hospital, have occupancy rates as low as 7 percent. And the Union Hospital District, which operates Wallace Thomson Hospital in Union County, filed a Chapter 9 bankruptcy petition last week in order to restructure its debts. The 59-bed facility had been running at less than 25 percent capacity for the past several years and had accumulated $20 million in debt during that time period.

The financial situation in South Carolina is exacerbated by the decision of the state's political leadership not to use federal funds to expand Medicaid eligibility under the Affordable Care Act.

Although any hospital can accessthe funding--which may eventually be supplemented by millions more federal dollars--officials indicated struggling rural hospitals would benefit the most, according to the Post and Courier.

Rural facilities throughout the U.S.,and hospitals in states that did not accept Medicaid expansion have a hard time compared to their counterparts in pro-ACA states. In Georgia, lawmakers have moved forward to create new step-down regulations in order to keep hospital emergency rooms in rural areas functioning. And the Centers for Medicare & Medicaid Services recently decided to extend a program that increased payments to hospitals with low annual patient volumes.

To learn more:
- read the Post and Courier article