Janet Jenson, a Salt Lake City attorney representing hospitals in Beaver, Garfield, Grand, Kane, San Juan and Sanpete counties, said the state is examining how it uses federal money to compensate hospitals with a large share of Medicaid and low-income uninsured patients.
Some rural hospitals will lose hundreds of thousands of dollars a year, she said.
"That money is critically important to keeping these hospitals open and operating," she said Friday. "They absolutely need it."
State Medicaid Director Michael Hales said the state is not trying to redistribute the roughly $23 million. Instead, it is renegotiating its contracts with the hospitals to ensure they comply with rules tied to the funds, he said.
For example, hospitals shouldn't get the money to compensate for co-payments that insured people don't pay, he said.
Jenson said the hospitals and the state will hold a conference call Monday to discuss the issue.
Lyman Duncan, interim administrator and chief financial officer for the San Juan Hospital in Monticello, plans to plead for the money. He said he could lose $700,000 in so-called "disproportionate share," or DSH, money - a critical portion of his $11 million budget.
"There's no question it would be one of the most significant challenges we could face as far as the ability to pay our bills and keep our doors open," he said.
Some 80 percent of his patients are on Medicaid or Medicare, and reimbursements don't always cover the cost of care, he said. Even with the DSH money, the hospital was in the red by $800,000 last year, Duncan said.
"Some patients travel 120, 130 miles just to be admitted to a hospital. If we don't keep our doors open, there would be no emergency room care in San Juan County," he added.
Jenson said other hospital administrators have told her they would need to close the doors of Kane County Hospital in Kanab, Milford Valley Hospital in Beaver County, and Beaver Valley Hospital. If that happens, there would be no hospital left to provide care in those counties.
The other hospitals that will be affected by the change: Gunnison Valley Hospital, Allen Memorial Hospital in Moab and Garfield Memorial Hospital in Panguitch.
hmay@sltrib.com
