The Ohio Hospital Association has told the governor (pdf) that his two-year budget is “not workable” and will lead to hospital layoffs, a decrease in services and an increase in costs to employers.
A primary issue is a new franchise fee that will cost hospitals a total of $598 million in the next two years. That money would be used by the state as matching funds to get additional federal funding. The Ohio Hospital Association estimates the state would return about $187 million to health systems and keep the balance: $411 million.
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Association spokeswoman Tiffany Himmelreich said health systems want the state to return the entire franchise fee levy to hospitals once Ohio gets its federal matching funds. The association plans to lobby for changes in the state House of Representatives.
“Hospitals understand the economic situation the state is in, but the hospitals can’t balance the Medicaid budget,” Himmelreich said. “They are already underpaid. They just can’t stand the hit.”
In addition, the association wants removed portions of the budget that requires Medicaid managed care companies to agree to non-negotiable price structures that, in turn, keep hospitals from negotiating their own prices.
Virtually every sector of the state is facing either increased fees or budget cuts. A franchise fee for nursing homes also is in the budget. Meanwhile, state employees expect massive layoffs as a result of cost-cutting in the budget.
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Gov. Ted Strickland’s spokeswoman, Amanda Wurst said this year’s budget was one of “shared sacrifice” but added the governor would work with the OHA.
