LANSING — Northern Michigan hospitals are sounding the alarm that billions of dollars in cuts to Medicaid will force healthcare providers — especially those in rural areas — to make tough decisions about what services they’re able to provide.
About a quarter of all Michigan residents are enrolled in Medicaid — in some Northern Michigan counties, it’s closer to a third.
“Healthcare clinics and hospitals, especially in rural Michigan, are at risk of closure, staffing shortages, longer ER times,” said Monique Stanton, director of the Michigan League for Public Policy.
KFF, a nonpartisan health research group, estimated that an earlier version of the bill would have left a quarter million additional Michiganders uninsured over the next decade.
Some policies like work requirements won’t take effect for years — but Michigan healthcare experts say that providers are already having to plan for the loss in revenue.
“Shifting more costs to states, work requirements and some of the other administrative burdens that we see in this bill will cut hundreds of millions and potentially billions of dollars from the Michigan Medicaid program,” said Elizabeth Hertel, director of the Michigan Department of Health and Human Services. “The state cannot absorb these losses, and we will have to make significant cuts in other critical areas.”
Advocates say that the policy changes will put an already stressed healthcare system under even greater pressure.
“Any sort of funding reduction, certainly of the nature that we’re describing here, really does impact our rural hospitals and other providers in a very significant way,” said Brian Peters, CEO of the Michigan Health and Hospital Association.
Peters says that state hospitals are set lose $6 billion in Medicaid funding over the next 10 years.
“You cannot take $6 billion out of the hospital funding line without a severe consequences in terms of access to patient care,” he said. “And that is not an idle threat. That is exactly what will happen if these cuts are fully implemented in the years to come.”
Some providers may consider converting into a Rural Emergency Hospital, which is a hospital that only maintains an emergency room — no inpatient services.
Representatives for McLaren and Munson both say that they’re still reviewing the policies and don’t currently have plans to reduce services or close locations — but new financial demands could change that.
“Slim and negative margins — that is the reality of rural health care in America, and this certainly does not help that,” said Deidra Wilson, senior vice president of government relations for McLaren Health Care.
The hospitals say that some of their more costly offerings include OB-GYN services, birth delivery and behavioral health programs.
“The pressures on rural hospitals are significant — they’re severe,” Wilson said. “Cuts that rural hospitals may have to look at in order to not close — because that’s what we don’t want to see. We don’t want to see closures. But all the analysis says many will close nationally.”