Infusion from feds buys time for safety-net hospitals

The feds have approved a $435 million aid plan for Massachusetts safety-net hospitals, the Boston Globe reports. The infusion includes $180 million for Boston Medical Center and channels another $163 million in federal Medicaid funding over the next two years to Cambridge Health Alliance, which runs Massachusetts' only public hospital.

Without the infusion of cash, Boston Medical Center, which laid off 119 nurses and managers last month, would have run out of cash reserves by next fall and faced a much larger reduction in force or consolidation with another provider's services, Kate Walsh, BMC's CEO told the Globe. The hospital already has dipped into its cash reserves to make ends meet.

Under the agreement between Gov. Deval Patrick's administration and the feds, the federal government will shell out $335 million, but the state must come up with about $100 million. 

Boston Medical had projected a $175 million loss in the fiscal year that ended on Sept. 30, the Globe reports. Cambridge Health Alliance ended the most recent fiscal year with a $83 million loss.

As part of the agreement, the hospitals must begin to shift to a new payment system and show that they making an effort to run more efficiently, Dr. JudyAnn Bigby, the state's secretary of health and human services, said. She fought for the money by arguing that safety-net hospitals, which care for large numbers of poor patients, do not have enough money to pay for the computer systems and other infrastructure changes they will need to prepare for the big changes in how providers will be paid by the government and private insurers.

To learn more:
- read the Boston Globe article
- here's the WBUR article