Hospitals claim state witholding federal reimbursement dollars

The state of Tennessee isn't playing fair when it comes to reimbursing public hospitals for uncompensated care, charge some critics. A large chunk of the money provided by the federal government to reimburse Tennessee for uncompensated care doesn't trickle down to hospitals such as Nashville General Hospital at Meharry.

Uncompensated care is a major worry for hospitals nationwide. So even though Tennessee's actions are legal, they are "not right"--especially when Nashville General could have a $10.5 million budget shortfall in the next fiscal year due to state cuts, says the Rev. Jay Voorhees, pastor of Antioch United Methodist Church and a member of Nashvillians for Metro General. In the 2008-09 fiscal year, the state withheld almost $20 million in uncompensated care costs from General Hospital, he says.

Next month, Nashville's Metropolitan County Council will consider a nonbinding resolution to ask each gubernatorial candidate to sign a pledge to work to ensure that Nashville General obtains "all federal funding for uncompensated care...earned by the Hospital's certified public expenditures." Such resolutions could become a trend in the state. Last month, the Shelby County Commission approved a similar measure to aid another public hospital, the Regional Medical Center at Memphis.

Critics don't understand how the system works, according to TennCare Bureau, the state agency that manages the federal funds. Federal funding for uncompensated care supports hospital payments from TennCare managed care organizations, so sending more federal money directly to the hospitals likely would result in cuts to the TennCare payments, says TennCare CEO Darin Gordon.

Nashville General has received an average of $7.4 million in annual special state payments for past three fiscal years. (The payment for the 2008-09 year was about $9.9 million.) However, the state has retained federal funding of $16.7 million to $19.9 million over the same period, say hospital advocates.

TennCare is using all of the federal funding for ongoing operations, says Gordon. "There isn't some extra pot of cash yet to be spent."

To learn more about uncompensated care funding:
- read The Tennessean article