Latest news with #KentuckyHospitalAssociation
Yahoo
25-06-2025
- Business
- Yahoo
‘They'll get over it,' McConnell reportedly assures GOP colleagues about Medicaid cuts
A spokesperson said U.S. Sen. Mitch McConnell was reminding his "colleagues that we should all be against waste, fraud, and abuse while working to protect our rural hospitals and have safety nets in place for people that need it.' (Photo by Jennifer Shutt/States Newsroom) When the U.S. House last month approved cutting Medicaid by $793 billion over the next 10 years, the Kentucky Hospital Association issued a surprisingly upbeat statement thanking the Kentucky Republicans who voted for the legislation, especially Rep. Brett Guthrie of Bowling Green. Guthrie had used his clout as chairman of the House Energy and Commerce Committee to protect a Medicaid funding stream that Kentucky hospitals say is critical to their survival. That funding stream now is at risk in the U.S. Senate, which is proposing even steeper cuts than the House to the federal-state program that pays for 1 in 3 Kentuckians' health care. If proposals from the Senate Finance Committee become law, 'you'll have hospitals closed, services eliminated and 20,000 jobs eliminated' in Kentucky, warns Nancy Galvagni, president and CEO of the Kentucky Hospital Association. 'We're encouraging our senators to support the House language on state directed payments,' Galvagni said Tuesday in an interview. While Republican senators from some states are voicing worries similar to those of Kentucky hospitals, Kentucky Sen. Mitch McConnell had a different message for Senate Republicans in a closed meeting Tuesday, reports Punchbowl News. 'I know a lot of us are hearing from people back home about Medicaid. But they'll get over it,' McConnell was reported as saying. Punchbowl reports that during the closed meeting, Sen. Thom Tillis, a Republican from North Carolina, raised concerns about Senate-proposed changes to the provider tax that helps support hospitals caring for large numbers of Medicaid patients. Tillis warned that provisions in the mega-bill that Republican leaders hope to approve by July 4 could result in GOP electoral losses similar to those suffered by Democrats after passage of Obamacare. A spokesperson for McConnell, the former Senate Republican leader, told the Lantern: 'Senator McConnell was speaking about the people who are abusing Medicaid — the able-bodied Americans who should be working — and the need to withstand Democrats' scare tactics when it comes to Medicaid. Senator McConnell was urging his fellow members to highlight that message to our constituents and remind them that we should all be against waste, fraud, and abuse while working to protect our rural hospitals and have safety nets in place for people that need it.' Sen. Rand Paul's office did not immediately respond to an emailed request for comment. At issue is a tax that Kentucky and other states collect from health care providers and use to supplement Medicaid payments. The goal is to boost what hospitals are paid for treating low-income Medicaid patients closer to what commercial insurers would pay for the same services. These state-directed payments pumped $4.5 billion into Kentucky hospitals in fiscal year 2024 and are expected to reach $5.5 billion by 2026. That's a quarter of the entire Kentucky Medicaid budget. Even with that supplemental support, many Kentucky hospitals are operating on perilously thin margins; without it, they would lose money, Galvagni told the Lantern Tuesday. The hospital association commissioned a study that found Kentucky hospitals on average are operating on a 2% margin that would drop into negative numbers — negative 7.4% — if what's proposed in the Senate is approved, she said. Researchers at the University of North Carolina recently analyzed hospitals' operating margins and their dependence on Medicaid payments and identified 338 hospitals that would be most at risk of shutting down as a result of the Medicaid cuts Congress is considering. Thirty-five of the hospitals identified as most at risk of closing are in Kentucky — more than any other state. (See list at bottom of story.) The House plan protects the status quo in Kentucky by freezing state provider taxes at current levels and grandfathering in existing plans for supplementing Medicaid reimbursements through state directed payments. Kentucky has three state directed payments plans — one for the state's two teaching hospitals at the University of Kentucky and the University of Louisville, one for all the other hospitals and a small plan for ambulance services. The Kentucky plans, approved by the first Trump administration in 2020, tie supplemental funding for hospitals to quality measures intended to improve care. Galvagni said the financial incentives are driving improvements including reductions in infection rates, readmissions and opioid prescribing. But the current Trump administration accuses its predecessors in the Biden administration of allowing states and health care providers to 'game the system' via provider taxes to tap additional federal funds to boost Medicaid payments. Medicaid covers people who have low incomes or disabilities including working people who can't afford or don't have access to employer-provided health insurance. It is funded jointly by states and the federal government with most of the money coming from Washington. Dr. Mehmet Oz, Trump's Medicare and Medicaid administrator, described provider taxes and state directed payments as 'legalized money laundering' in a recent Capitol briefing, reports The Hill. A June 6 White House memorandum says: 'These State Directed Payments have rapidly accelerated, quadrupling in magnitude over the last 4 years and reaching $110 billion in 2024 alone,' threatening 'the Federal Treasury and Medicaid's long-term stability.' GOP leaders in US Senate struggle to lessen pain of Medicaid cuts for rural hospitals The memo orders Health and Human Services Secretary Robert F. Kennedy Jr. 'to eliminate waste, fraud, and abuse in Medicaid, including by ensuring Medicaid payments rates are not higher than Medicare, to the extent permitted by applicable law.' The Senate proposal would reduce Medicaid's state directed payments to hospitals by 10% each year until they reach the allowable Medicare-related payment limit. Republicans in Congress are looking to cut federal spending in order make tax cuts from the first Trump administration permanent. Even with the cuts to health care and nutrition programs, and taking into account economic growth from the tax cuts, the House bill is projected to increase the national debt by $2.8 trillion over 10 years, or about $3.4 trillion if the full costs of federal borrowing are included, according to the Congressional Budget Office. The Congressional Budget Office also estimates that the House bill would cost the poorest Americans roughly $1,600 a year while increasing the income of the wealthiest households by an average of $12,000 annually Galvagni said pegging the Medicaid supplement to Medicare rates, as the Senate committee proposes, would be 'extremely damaging to Kentucky' and put many Kentucky hospitals into an even more unsustainable financial position because Medicare rates in Kentucky are almost as low as Medicaid rates. 'You can't pay the hospitals less than what it costs to deliver services,' Galvagni said, and not expect some to close and others to reduce services. Medicare is a federally funded program that mainly covers people age 65 and over. Galvagni also disputed suggestions that Kentucky is abusing the provider tax. All hospitals pay the same rate, she said, and the amount of tax they pay is not related to the amount of money they receive from Medicaid. In the U.S. Senate, Republicans Jim Justice of West Virginia and Josh Hawley of Missouri have publicly voiced surprise and alarm at the cuts to provider taxes and Medicaid payments proposed by the Finance Committee. Sen. Susan Collins, Republican of Maine, has proposed creating a fund for rural hospitals, which seems to have gained some traction in the Senate. 'Not helpful' was Galvagni's assessment of such a fund. 'We appreciate the intent,' she added. Provisions in the House bill would cause an estimated 277,000 Kentuckians to lose their Medicaid coverage, according to KFF, which says that number could go as high as 346,000. Republicans in Congress also are expected to let tax credits expire that help Americans afford health insurance in the Affordable Care Act marketplace. Without the tax credits the number of uninsured Kentuckians is projected to rise by 21%, according to The Urban Institute. The Cecil G. Sheps Center for Health Service Research at the University of North Carolina identified these Kentucky hospitals as most at risk of closure under proposed cuts to Medicaid: Whitesburg ARH Hospital, Highlands ARH Regional Medical Center, UofL Health – Shelbyville Hospital, T.J. Samson Community Hospital, St. Claire Regional Medical Center (UK St. Claire), Middlesboro ARH Hospital, Spring View Hospital, Advent Health Manchester, Bourbon Community Hospital, Harlan ARH Hospital. Deaconess Henderson Hospital, CHI Saint Joseph Health – Saint Joseph Mount Sterling, Tug Valley ARH Regional Medical Center, Owensboro Health Twin Lakes Medical Center, Baptist Health Corbin, Clark Regional Medical Center, Baptist Health Deaconess Madisonville, The Medical Center at Albany. Three Rivers Medical Center, Kentucky River Medical Center, TJ Health Columbia, Pineville Community Health Center, Mercy Health – Marcum and Wallace Memorial Hospital, ARH Our Lady of the Way Hospital, Casey County Hospital, Carroll County Memorial Hospital, The Medical Center at Caverna. Ephraim McDowell Fort Logan Hospital, Mary Breckenridge ARH Hospital, Jane Todd Crawford Hospital,Barbourville ARH Hospital, CHI Saint Joseph Health – Saint Joseph Berea, Russell County Hospital District, McDowell ARH Hospital, Fleming County Hospital. McKenna Horsley contributed to this story. SUPPORT: YOU MAKE OUR WORK POSSIBLE
Yahoo
12-02-2025
- Business
- Yahoo
GOP lawmaker moves to overhaul bill protecting drug discounts critical to some KY hospitals
Kentucky hospitals would be required to file data about their discounts from drug companies through the 340B program under an amendment sponsored by Sen. Gex Williams. (Getty Images) A Northern Kentucky lawmaker has proposed a new version of a bill meant to protect a program that generates income for charity health care that some Kentucky hospitals say is essential for their survival. 'This is a very critical program for our hospitals and access to care in rural communities,' Nancy Galvagni, president of the Kentucky Hospital Association, told a legislative committee Feb. 5, referring to the federal 340B Drug Pricing Program. But Sen. Gex Williams, R-Verona, has filed an amendment to Senate Bill 14 to replace it with a measure he said is critical to getting more information about how much money from the program, subsidized by the pharmaceutical industry, is generated and spent before further legislative action. 'It tries to collect some data so we can better understand what we're dealing with,' said Williams, whose legislative page describes him as an engineer and technology consultant. 'The data we collect will enable us to better ascertain the fiscal impact on the state of Kentucky.' The program, which generates income for charity care from deep discounts drug manufacturers provide hospitals and other entities, such as health clinics, has come under fire from consumer advocates and the pharmaceutical industry for what they say is its rapid growth and lack of oversight. 'When hospitals, other covered entities and their contract pharmacies have free rein to mark up medicines, patients, employers and taxpayers across Kentucky pay the price,' Reid Porter, a spokesman for Pharmaceutical Research and Manufacturers of America, or PhRMA, said in an emailed statement. 'Transparency and accountability are needed to ensure 340B is being used appropriately.' PhRMA, along with other groups including the Kentucky Association of Manufacturers, oppose SB 14 as filed by Sen. Stephen Meredith, R-Leitchfield and a former hospital CEO. Meredith did not respond to a request for comment about the changes Williams proposes to SB 14. He has argued his SB14 would preserve an essential income stream especially important to rural hospitals in Kentucky. At the Feb. 5 meeting of the Senate Health Services Committee he chairs, Meredith said his bill simply mirrors legislation passed in a handful of other states that prevents pharmaceutical companies from restricting drugs sold in Kentucky at discounts of up to 50%. He said some companies have begun imposing such restrictions that limit revenue to Kentucky providers. 'Why should we not be allowed to have this funding when other states do?' asked Meredith, who said it brings in about $122 million a year for Kentucky hospitals, clinics and other entities that serve low-income patients. The Kentucky Hospital Association, which supports Meredith's bill, agrees. While Williams' proposal may be 'intended to be helpful,' it doesn't account for how the program generates savings for hospitals by requiring manufacturers to provide them drugs 'at the same price the drug companies charge their best customers,' said Jim Musser, senior vice-president with the association. 'The savings generated from that discounted price allow the hospitals to put the savings toward stretching scarce resources,' he said. Several supporters of the bill testified the 340B program is especially helpful for expanding access to costly cancer infusion drugs which can cost tens of thousands of dollars. KY health care providers depend on drug discount program that's facing fire on several fronts Williams said he hadn't discussed his amendment to SB 14 with Meredith other than to notify him he planned to file it. 'I'm presuming we'll discuss it in caucus,' Williams said, referring to the meeting of the Republican majority that controls the Senate. He said he doesn't know when it might be called on the floor for a vote after committee passage Feb. 5. Williams' amendment would strip out Meredith's language from SB 14 and replace it with a bill that would require all hospitals and any affiliated facilities, such as health clinics, to file a detailed annual report with the Cabinet for Health and Family Services about how much money they gain from the program and how they use it. The bill also would apply to 'contract' or outside pharmacies used by those hospitals and clinics which critics say have expanded rapidly to include major drugstore chains and industry middlemen known as pharmacy benefit managers or PBMs. Williams said the legislature could consider changes to state law after it determines details about how much money the program generates and where it goes. 'I don't know how we can make a decision … without data,' he said. Williams's proposal does not apply to clinics not affiliated with hospitals such as the state's system of 'safety-net' health clinics authorized by the federal government to provide care for low-income and uninsured patients. Advocates for the about 30 such clinics across Kentucky had expressed alarm at potential reduction of the funds they say are vital to care they provide. Molly Lewis, executive director of the Kentucky Primary Care Association, said the 340B program brings in about $19 million a year to the community health clinics, funds she said are essential to caring for patients who can't pay for services. 'We support Senate Bill 14,' she said, referring to Meredith's original bill. Meanwhile, some advocates continue to seek reforms at the federal level since the federal government oversees the program. Meredith has said he agrees overall change must come from Congress, which is considering proposals to tighten controls and improve oversight of the 340B program. His bill, he said, is meant to protect Kentucky health providers in the meantime. 'I don't think there's a person involved in health care that realize there need to be some changes, some adjustments to it,' he said at the Feb. 5 hearing. 'But that's not why we're here today.' SUBSCRIBE: GET THE MORNING HEADLINES DELIVERED TO YOUR INBOX
Yahoo
05-02-2025
- Health
- Yahoo
Kentucky hospitals testify they need drug discount program under attack by pro-Trump group
Hospital officials who spoke in support of Senate Bill 14 Wednesday include, from left, Angela Portman, CEO of Breckinridge Health; Nancy Galvagni, president of the Kentucky Hospital Association; Don Lloyd, CEO of UK St. Claire Regional Medical Center, and Brian Springate, CEO of Appalachian Regional Healthcare's Hazard hospital. (Kentucky Lantern photo by Deborah Yetter) FRANKFORT — A bill aimed at strengthening access in Kentucky to a federal program that generates income for charity health care passed a Senate committee Wednesday, with several rural hospital executives telling lawmakers it has helped keep them in business. The program 'undoubtedly saved our hospital,' said Angela Portman, CEO of Breckinridge Health Inc., a 25-bed independent hospital in Hardinsburg. 'We were out of options.' Several speakers attempted to express concerns about how Senate Bill 14 would affect the federal 340B Drug Pricing Program but were cut short by Sen. Stephen Meredith, R-Leitchfield, chairman of the Senate Health Services Committee and sponsor of SB 14. Meredith warned beforehand he didn't want to hear testimony about the federal program, subsidized through deep discounts from the pharmaceutical industry. Any reforms to the program overall must come at the federal level, where legislation is pending, he said. Critics of SB 14, including a representative of the Pharmaceutical Research and Manufacturers of American, of PhRMA, came forward to testify. 'We will not have a debate on 340B today,' Meredith said. 'We can't change that. It's federal law.' But a national 'dark money,' pro-Trump group, Building America's Future, showed its opposition Wednesday by driving a truck with a flashing sign board around the Capitol with alternating messages including its claim that '340B is subsidizing gender transitions for kids.' 'Tell state Republican: STOP 340B,' it said, with a notice that it was 'paid for by Building America's Future.' Supporters of the program in Kentucky have rejected that claim as baseless, pointing out Kentucky's Republican-controlled General Assembly banned gender affirming care for minors in 2023 and the program is chiefly aimed at generating revenue hospitals and clinics use to expand health resources for the poor. 'This is a very critical program for our hospitals and access to care in rural communities,' Nancy Galvagni, president of the Kentucky Hospital Association, said at the hearing. The outside group, which has been linked to Elon Musk, an advisor to President Donald Trump, said in a recent press release it has launched a 'five-figure' television and podcast ad buy appealing to Republicans to oppose pending bills in Utah, Nebraska, North Dakota and Kentucky, describing 340B as an 'out-of-control government program' that is 'secretly sabotaging' Trump's agenda. No one from the group spoke at Wednesday's hearing and Meredith didn't address its claims in the 45-minute discussion of SB 14. The group has not responded to the Lantern's request for comment. Rather, Meredith limited discussion to SB 14, which he said would preserve benefits to Kentucky health providers. The 340B program, authorized by Congress in 1992, was meant to aid health providers by giving them more money to help low-income patients, including providing lower cost drugs. Created with the support of the pharmaceutical industry, it required drug manufacturers to provide drugs at discounts of up to 50% to hospitals and clinics that provide care to a certain percentage of low-income patients including those covered through Medicaid, the state-federal health plan. Hospitals and clinics provide those discounted drugs through pharmacies, then bill insurers including Medicaid for the market price of the drugs and keep the difference — the goal being to use those resources for low-income patients. But it has expanded rapidly over the years, aided by changes in federal law that the pharmaceutical industry and some consumer advocates argue have allowed national pharmacy chains and major health systems to benefit from 340B at the expense of consumers and low-income patients it was supposed to help. KY health care providers depend on drug discount program that's facing fire on several fronts 'Our members believe this bill does not protect patients,' said Russell Palk, with the Biotechnology Innovation Organization, a Washington D.C.-based trade association. 'It does not lower their out-of-pocket costs.' Meredith rejected that assertion. 'I don't believe that's true,' he said. Rather, he said, his bill — similar to legislation enacted in other states — would merely prevent pharmaceutical manufacturers from discriminating against Kentucky by requiring them to provide the same drugs at the same discounts as they do in other states. As 340B has grown, some pharmaceutical manufacturers are restricting discounted drugs they will ship to Kentucky, he said. The program provides an estimated $122 million a year in additional revenue for health care in Kentucky, he said. 'Why should we not be allowed to have this funding when other states are?' Meanwhile, hospital CEOs told the panel Wednesday that income from 340B is critical to providing patient care, especially for cancer treatment where chemotherapy drugs can cost tens of thousands of dollars. 'Cancer treatment is expensive and without the 340B program many of our patients simply would not have access to it,' said Brian Springate, CEO of Appalachian Regional Healthcare's Hazard hospital. SB 14 passed the committee on a 9-1 vote and now goes to the full Senate. A similar bill last year sponsored by Meredith passed the Senate but died for lack of action in the House.