The Free Press, Mankato, MN

Local News

April 21, 2009

Hospitals seek fair cuts

Representatives to speak to House leaders

Representatives of some of Minnesota’s biggest hospitals and some of its smallest will be at the Capitol today to detail the impact of proposed budget cuts on their facilities.

Dr. Greg Kutcher, of Immanuel St. Joseph’s Regional Medical Center, will tell of a nearly $10 million impact on the hospitals in Mankato, Waseca, St. James and Springfield over two years. And Lori Wightman of the New Ulm Medical Center will talk about the estimated $2 million blow to her facility.

“For New Ulm Medical Center, that’s a big deal,” said Wightman, president of the facility.

It’s much more of a problem now than it would have been even in 2003, the last time the state faced a similar-sized budget crisis, she said.

“Charity care has tripled or quadrupled since 2003,” Wightman said, adding that uncompensated care reached $2.5 million in 2008 and it’s been increasingly difficult to shift the cost of serving the uninsured to other payers.

ISJ President and CEO Kutcher said the hit to the ISJ system would equal about two-thirds of the nonprofit system’s surplus of revenue over expenses — the money that’s used to improve and replace equipment.

The nearly $10 million impact on ISJ is partly the projected increase in charity care that would be caused by Pawlenty’s proposal to reduce the number of working Minnesotans eligible for subsidized health insurance and to cut access to services for poverty-level medical programs. But much of the estimated hit to ISJ is direct reductions in reimbursements to the hospitals, Kutcher said.

“A good share of that is just hard cuts,” he said.

Both Wightman and Kutcher aren’t asking to be spared when they talk to lawmakers, instead asking that all aspects of the state budget share evenly in the cuts required.

“We’ve never said ‘Don’t cut us,’” Kutcher said. “We’ve said, ‘Make it fair.’”

The DFL-dominated Senate has essentially taken that approach, aiming to make across-the-board spending cuts while also raising taxes. Pawlenty, eschewing state tax hikes, has exempted K-12 education, veterans programs and public safety programs from deep cuts — making for even more substantial reductions in the rest of the state budget.

The representatives of the hospitals will be talking to House leaders — and the media — at this morning’s briefing. It’s part of a conscious effort to be more aggressive in getting their message out.

“As an industry, we haven’t been as vocal as education or cities or counties,” Wightman said. “We, as an industry, are just learning to be more effective in telling our story.”

Part of Wightman’s effort will be to provide specific examples of the “very short-sighted” nature of the budget cuts such as the governor’s suggestion to cut access to physical therapy and a range of other rehabilitation services. She said she talked to staff about a 37-year-old carpenter in New Ulm who wasn’t working and was on Medicaid because of severe lower back pain.

Under current law, the man was eligible for physical therapy and has improved to the point that he’s beginning to work again.

“Being able to return to work will likely allow him to go off of Medicaid services,” Wightman said. “... And physical therapy was essential to getting him back to work.”

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