Maine health care providers warn of service cuts due to budget stalemate

AUGUSTA, Maine — Hospitals and health care providers are feeling pressure after the Legislature once again failed Tuesday night to pass a short-term budget that fills a $118 million MaineCare shortfall.

The State House dysfunction could cost Mount Desert Island Hospital up to $50,000 a week due to the state now delaying and capping payments from its Medicaid program amid lawmakers not yet passing a supplemental budget to immediately fill the funding gap.

“It will erode services,” MDI Hospital CEO Christina Maguire said Wednesday, describing how the hospital that also covers outer islands and parts of Hancock County will struggle to pay bills and hire staff amid budget delays.

Millinocket Regional Hospital CEO Robert Peterson said payment reductions will make it “increasingly difficult to cover our normal expenses in a timely manner” and noted the budget stalemate delays the state in paying his hospital a “large” settlement following an annual audit.

“It is imperative that our rural Maine hospitals remain viable and available to our residents,” Peterson said. “To risk failure of these hospitals due to a state budget shortfall is abhorrent.”

The dire sentiments came after Senate Republicans opposed Tuesday night a short-term budget that otherwise had bipartisan support in the House to fill a $118 million MaineCare gap and give $2 million to fight spruce budworm infestations. Senate President Mattie Daughtry, D-Brunswick, has called her chamber back Thursday to reconsider the plan.

But it was unclear on Wednesday whether anything had changed to resolve the stalemate. Democrats can pass the measure by a simple majority, but it would not go into effect until June without two more votes from Republican senators.

Daughtry, Senate Minority Leader Trey Stewart, R-Presque Isle, and House leaders crafted an amendment Monday that would limit General Assistance per recipient to 12 months in a 36-month period, force Gov. Janet Mills’ administration to give direct care workers a 1.95 percent cost-of-living increase lawmakers had previously approved and require a third party to study “waste, fraud and abuse” in MaineCare.

After the House overwhelmingly passed it, all Senate Republicans except for Sens. Rick Bennett of Oxford and Marianne Moore of Calais ended up opposing the short-term budget in a final vote Tuesday night. Stewart said his caucus wanted more changes to rein in MaineCare costs, such as work requirements President Donald Trump could push for at the federal level.

Stewart said he had only agreed Monday to bring the amended plan back to his members before making “very clear” to Daughtry and other Democrats on Tuesday his caucus would not support it unless it had “substantive welfare reform.” But Daughtry said Republicans “flipped” on Mainers and walked away “from a compromise that had been negotiated in good faith.”

“This brinksmanship is senseless and counterproductive,” Mills, a Democrat, said in a Wednesday statement. “Senate Republicans should honor this partisan agreement and pass this bill.”

The lack of a supplemental budget is showing up in this week’s pay cycle for MaineCare providers. The Mills administration said certain payments for critical access hospitals are now capped at 70 percent of their normal levels.

The state is also pausing all hospital claims greater than $50,000, all payments for large retail pharmacies and durable medical equipment providers and all payments for out-of-state providers. Independent pharmacies located in New Hampshire towns within 15 miles of the Maine border will continue to be paid, the Department of Health and Human Services said.

Northern Light Health Eastern Maine Medical Center President Ava Collins noted the system has already been struggling financially in recent months and said a lack of a supplemental budget costs the multi-hospital system about $6 million per month.

Rep. Jack Ducharme, R-Madison, a top appropriator who voted in favor of the short-term plan, said the latest indication on MaineCare funding is the state has enough money to last until the end of April. He acknowledged “a whole lot of fear” for health providers and said he is not sure what the Senate may do Thursday but is hopeful for a deal.

Ducharme added if Republican senators have opportunities to “get something that you want … then you should do that.”

Penobscot Community Health Center CEO Lori Dwyer, who leads Maine’s largest federally qualified health center that serves about 60,000 patients, said they will not see payment reductions until March 26. But Dwyer said PCHC does not yet know how much of a reduction it could see amid 38 percent to 40 percent of its patient revenue coming from MaineCare.

This delay and bigger cuts could force the health center with locations in Penobscot County as well as in Belfast and Jackson to reduce hours or temporarily close clinics, Dwyer added.

“This is a completely manufactured crisis that’s entirely avoidable,” Dwyer said.

BDN writers Marie Weidmayer and Michael Shepherd contributed to this story.