State uses $8M indigent-care funds to settle alleged improper deals

Instead of using federal matching funds for indigent care, New Mexico will use $8 million to settle claims that nine hospitals made improper deals with county governments, The New Mexican reported.

An investigation by the Centers for Medicare & Medicaid Services found that the state's contributions to leverage federal Sole Community Provider funds in 2009 included "non-bona fide donations or in kind transfers," according to the article.

The CMS review likely was prompted by the U.S. Department of Justice joining a whistleblower lawsuit that accused Eastern New Mexico Medical Center and other Community Health Systems hospitals of making illegal donations to counties to get the biggest county contributions possible, thus upping their federal matching funds.

Although originally seeking to recover $53 million, CMS reached an agreement with New Mexico to settle for $7.9 million.

That amount will come from the state's contributions to the Sole Community Provider program for fiscal year 2012, eliminating the state's opportunity to have the money matched at the 3-to-1 ratio, noted The New Mexican.

The settlement could affect hospitals' ability to adequately care for indigent patients, as the $1.3 million settlement money coming from Santa Fe County's contribution will cause Christus St. Vincent Regional Medical Center to lose almost $4 million in federal indigent-care funds.

Despite the settlement, the nine hospitals have not admitted any wrongdoing.

For more information:
- read the The New Mexican article
- here's the FierceHealthcare article on the whistleblower suit

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