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Yahoo
23-05-2025
- Business
- Yahoo
Ayotte, hospitals settle bitter suit over Medicaid tax scheme
The state and acute-care hospitals have settled what had become a bitter lawsuit over charges that New Hampshire was getting ready to exploit a federal cash reimbursement provision under Medicaid to land a nine-figure profit while giving hospitals $70 million less under this new design. Gov. Kelly Ayotte announced the settlement that Attorney General John Formella's team had negotiated with the New Hampshire Hospital Association, Dartmouth Health and Concord Hospital that all had sued the state over its Medicaid Enhancement Tax (MET) program. 'This agreement is a win for our state, for rural health care access, and, most importantly, for patients,' Ayotte said in a statement. 'I am proud of my team's tireless efforts to reach a deal, and I thank Dartmouth Health, Concord Hospital, and the Hospital Association for coming back to the table to deliver the best possible outcome for everyone.' This was the third time hospitals had sued over changes to the reimbursement. Two Superior Court judges in the past had ruled the Medicaid tax to be unconstitutional because it's imposed on the state's 26 acute-care hospitals, but not on other providers, such as rehab or day surgery facilities. As with the previous two suits, hospital executives held further talks with state officials after the suit to reach a deal. 'This agreement is an important step toward ensuring that Dartmouth Health can continue to provide critical care to our patients and communities where and when they need it,' said Dr. Janet Conroy, CEO and president of Dartmouth Health. 'We value our partnership with the state and are grateful for Governor Ayotte's support to reach a resolution. We look forward to continued collaboration in support of a strong, sustainable healthcare system for our patients.' According to state officials, the agreement is a 'budget neutral solution' that would deliver $1 billion in total payments to hospitals over the next three years, consistent with what hospitals had requested. In turn, the state would receive $60 million more in benefits compared to previous proposals. 'We are pleased that we were able to reach a settlement agreement with Governor Ayotte that will help strengthen the Medicaid program, support hospitals and other essential providers, and most importantly ensure continued care for the patients and communities who count on our hospitals to be there for them when they are needed most,' said Steven Ahnen, president of the NHHA. In 1991, the state imposed the Medicaid Enhancement Tax on hospitals to qualify the state for bonus matching grants from the federal government. Under the plan, the state pays back the hospitals for nearly all that they paid out in taxes, often on the same day. The state received more than $300 million in annual reimbursements from Washington that it must spend on the federal/state Medicaid program. The Biden administration ordered all states to change the hospital tax and payment arrangements that critics here always called a 'scam.' Federal officials are requiring states to also make direct payments to the hospitals to receive the qualifying federal help, rather than just impose a tax on hospitals and then pay them back. Since a 2018 settlement, hospitals, in the aggregate, had received 91% back of what they paid the state. Former Gov. Chris Sununu last summer directed state officials to lower that reimbursement to 80% and to direct more grants to mental health, substance abuse and federally qualified health care centers that were financially beleaguered. In her two-year state budget plan offered last February, Ayotte stuck with the 80% model for 2026-27. Ahnen said this would have given the state $137 million more than it receives currently, while the hospitals would have gotten $70 million less than they do now. The state's 11 largest hospitals as a group would have lost $100 million, Ahnen said. To ramp up the pressure for a deal, Dartmouth Health, Concord Hospital and other major hospitals withheld the April 15 tax payment putting at risk the state's ability to generate the bonus federal match. 'We are encouraged that through this agreement with the state of New Hampshire quality, affordable health care will continue to be available to the patients and communities we serve at Concord Hospital Health System,' said Robert P. Steigmeyer, president and CEO of the Concord hospital system. 'We remain committed to working with state leaders to uphold our community-focused, charitable mission — now and for generations to come.' This deal puts in the rearview mirror some tough rhetoric from Ayotte after the hospitals had filed a suit. 'Unfortunately, the plaintiffs are only focused on driving more money to billion-dollar corporations and have resorted to playing political games and misleading the public,' Ayotte said at the time. 'They should return to the table and come to an agreement that benefits all Granite Staters.' The 'big beautiful bill' the U.S. House passed by one vote earlier this week to restore Trump tax cuts also would limit such Medicaid Enhancement Taxes to 5%. This could cost this state and the hospitals each tens of millions of dollars in lost revenue. Ayotte, a former U.S. senator, told reporters she won't overreact to the House proposal. 'When it's working its way through the process, it's hard to react to what the impact will be on New Hampshire,' Ayotte said. Many Senate Republicans led by Sen. Josh Hawley of Arkansas have said they would oppose any significant cuts to Medicaid as part of this global federal budget agreement. What's Next: The House Ways and Means Committee meets Tuesday on legislation (SB 249) that deals with this reimbursement scheme. The panel may decide to amend that bill to include terms of this settlement. Prospects: Now that all the major parties are on board, the Legislature will follow suit and with some legislation embrace these terms. klandrigan@
Yahoo
29-04-2025
- Business
- Yahoo
House budget writer: Make Senate find $38M to boost payments to hospitals
A chief House budget writer said it's up to the Senate to find $38 million in higher taxes or further spending cuts to sweeten payments to hospitals under the Medicaid tax plan that already had the support of Gov. Kelly Ayotte and the House of Representatives. 'This is the wrong venue, time and method for this bill,' said House Finance Committee Vice Chairman Dan McGuire, R-Epsom. 'It will cost the state $19 million a year, which isn't in either the governor's budget or the House budget. That is a $38 million drain on the Rainy Day Fund in the biennium which should be unacceptable.' Meanwhile, Steve Ahnen, the president and CEO of the New Hampshire Hospital Association, called the state Senate-passed bill (SB 249) providing those hospitals more reimbursement money a 'great, first step forward,' but added more is needed to reduce the harm done to some institutions. 'Hospitals will still lose money, we are simply trying to lose less and do so in a fair and reasonable way,' Ahnen told the House Ways and Means Committee Tuesday. "It (Senate bill) needs to do a little bit better." In 1991, the state imposed the Medicaid Enhancement Tax on hospitals to qualify the state for bonus matching grants from the federal government. Under the legal maneuver, the state pays back the hospitals for nearly all that they paid out in taxes, often on the same day. Under the arrangement, the state received more than $300 million in annual reimbursements from Washington that it must spend on the federal/state Medicaid program. The Biden administration ordered New Hampshire and all states to change those hospital tax and payment arrangements that critics here always called a legal "scam." Federal officials are requiring states to make direct payments to the hospitals to receive the qualifying federal help, rather than impose a tax on hospitals and then pay them back. Since a 2018 lawsuit settlement, hospitals, in the aggregate, had received 91% back of what they paid the state in MET. Former Gov. Chris Sununu last summer directed state officials to lower that reimbursement to 80% and to direct more grants to mental health, substance abuse and federally qualified health care centers that were financially beleaguered. Hospitals sued In her two-year state budget plan offered last February, Ayotte stuck with the 80% model for 2026-27. Ahnen said this will give the state $137 million more than it receives currently, while the hospitals will receive $70 million less than they do now. The state's 11 largest hospitals as a group would lose $100 million, Ahnen said. That's why the biggest hospital group, Dartmouth Health, joined the New Hampshire Hospital Association in suing the state for the third time in the past decade over the issue. Matthew Houde, Dartmouth Health's system vice president of government relations, said it would lose $31 million under the plan and if it stands, service reductions would be unavoidable. Through nine months, Dartmouth Health operated at a 1.4% profit margin which totals $35 million, Houde said. In response to the suit, Ayotte accused hospitals of being solely focused on 'playing political games and misleading the public.' 'Unfortunately, the plaintiffs are only focused on driving more money to billion-dollar corporations and have resorted to playing political games and misleading the public,' she said. 'They should return to the table and come to an agreement that benefits all Granite Staters.' Last month, the Senate amended its bill to restore the 91% reimbursement rate which is what former Senate President Jeb Bradley, R-Wolfeboro, tried but failed to get Sununu's support for last spring. 'Now that we have been sued, what happens will be anyone's guess,' said Senate Majority Leader Regina Birdsell, R-Hampstead, the bill's prime author. McGuire urged the House panel kill or retain Birdsell's bill and force budget writers to find the $38 million in additional reimbursement to the hospitals as it produces an alternative state budget plan next month. But Houde pointed out Dartmouth Health and other providers have withheld MET payments that were due to the state on April 15. This threatens the state's ability to obtain all that bonus federal money in the coming weeks if a deal isn't reached soon. 'There is a timeliness component here with regards to getting the match from the federal government,' Houde said. Ahnen reminded that two past superior court judges found the MET tax to be unconstitutional because it's not levied on 'similar' providers such as ambulatory surgery centers or rehab hospitals. Losing again would deny the state more than $400 million in federal reimbursement, he warned klandrigan@
Boston Globe
18-04-2025
- Health
- Boston Globe
‘Am I going to give birth on the side of the road?' In rural NH, hospital closures lead to ‘maternity deserts.'
'That definitely added more anxiety,' Ingerson said. Since 2002, 11 of the 26 labor and delivery units in the state have closed, creating what the state has deemed 'maternity deserts' in parts of rural New Hampshire. To help fill the gaps, the state is training emergency first responders who say they are increasingly coming to the aid of women in labor. Advertisement 'This is a service that people desperately need, that people will literally die if they don't have,' said Daisy J. Goodman, a nurse-midwife at Dartmouth Health who works with the Get N.H. Morning Report A weekday newsletter delivering the N.H. news you need to know right to your inbox. Enter Email Sign Up Many of the hospitals that have closed their labor and delivery units faced financial pressure to do so, according to the latest The units that closed had fewer births, and more mothers who were insured by Medicaid, which traditionally doesn't reimburse as well as private insurance, Goodman said. Advertisement New London Hospital had been operating at a loss for three years when it closed its birthing unit as a way to control cost, a hospital spokesperson told the Statewide, the birth rate has declined 33 percent, dropping from 12.67 births per 1,000 people in 1995 to 8.51 per 1,000 people in 2023, the latest data available. In the state's most-populous county, Hillsborough, the rate is still at 10 births per 1,000, while it's the lowest in more-rural parts of the state like Carroll County, where the rate has dipped to 6.6 births per 1,000. Before the closures, about 7 percent of the state's population lived more than half an hour away from a hospital with labor and delivery services; now, about 19 percent do, according to Sanam Roder-DeWan, a primary care physician at Dartmouth Health who works with the North Country Maternity Network. Nationally, a typical drive to the nearest hospital takes about 16 minutes, according to the Roder-DeWan said that for about 14,000 people, the drive to the nearest hospital with such services is over an hour away. For people who live in Pittsburg, N.H., it can take nearly two hours to drive to Littleton, N.H., where there is a hospital with a labor and delivery unit. Advertisement 'If you're in labor, that's a huge distance,' said Goodman. 'In the winter, it's an almost insurmountable distance. It's life-threatening to drive in a car in certain kinds of snowstorms up there.' Roder-DeWan said the distance can add anxiety to an already intense process. 'There's a ton of fear,' she said. Women wonder: 'Am I going to give birth in an ambulance? Am I going to give birth on the side of the road?' she said. That was the concern for Brianna Lareau, who lives in Piermont, a 45-minute drive from Dartmouth Hitchcock Medical Center in Lebanon, where she gave birth to her two youngest children, now 4-months old and 2-years old. She had experienced placental abruptions in her first three pregnancies, a complication when the placenta separates from the wall of the uterus before delivery. It can decrease the baby's oxygen supply and cause 'There was always an anxiety that if something did happen while I was at home or on the road, the fear of bleeding out or the baby not getting the care she would need right away,' Lareau said. Neighboring states are seeing access to maternal care diminish, too. In Maine, 42 percent of its community hospitals have closed their birthing units because of financial challenges, according to Roder-DeWan. Advertisement 'We're looking at a trend that is going in the wrong direction,' said Roder-DeWan. The further people have to travel for care, the less likely they are to receive the recommended number of prenatal care visits, and the more likely they are to give birth enroute to the hospital or have an unplanned home birth, the Nick McNally holds his daughter Annalise McNally, standing next to his wife Keelin Shea, with their 2-year-old daughter Audrey Rose McNally. The family got to meet the 911 dispatcher who helped guide their childbirth over the phone in January. Amanda Gokee/Globe Staff That's what happened to Keelin Shea, 32, last January. Shea, who lives in Tuftonboro, , was planning to give birth at Memorial Hospital in North Conway, about 40 miles away. Huggins Hospital in Wolfeboro is just 15 minutes away, but it closed its labor and delivery unit in 2008. 'Anywhere we were going to go would be an hour or more because there's no local birthing centers,' said Shea. When she was 38 weeks pregnant, Shea felt contractions but didn't leave for the hospital. Her thinking was: 'I don't want to drive the whole hour to the hospital if I'm going to get sent home,' she said. Shea was still at home when her water broke. With a 911 dispatcher on the phone, she ended up having an Giving birth in an unintended location can come with Advertisement Varanka, who is leading efforts to train first responders, said there's an acute need for labor and delivery training. 'There were some knowledge gaps,' Varanka said, especially around the initial postpartum stage, which is also called the third stage of labor, after the newborn is out and before the placenta is delivered. North Country Maternity Network, the group Goodman and Roder-DeWan work with, is addressing the lack of maternal care in the North Country by hiring and deploying doulas, training nurses on high-risk pregnancy management, and helping hospitals implement better billing practices to improve their bottom lines. Still, the closures are a devastating loss for the communities that are left behind, according to Julie Bosak, a nurse-midwife at Dartmouth Health. And the longer a hospital has been closed, the harder it is to bring care back to the community after the workforce has moved away. 'We can't risk allowing more to close,' she said. Jessie Ingerson is one of the women who had to drive over an hour from her home in Jefferson, N.H., to the nearest labor and delivery unit. She gave birth to her son, Wesley, pictured here, at Memorial Hospital in Conway, N.H. Jessie Ingerson Ingerson, who faced the 42-mile journey through the mountains to Memorial Hospital, gave birth to a healthy baby boy about six hours after her water broke at home. She had made the trip to the hospital at least 10 times during her But, she said, in the North Country, 'We don't have a lot of options.' Amanda Gokee can be reached at
Yahoo
15-04-2025
- Health
- Yahoo
Hospitals again sue state over tax reimbursement plan
Hospitals, Ayotte spar over Medicaid tax, new payments plan Gov. Kelly Ayotte accused the state hospital lobby of "playing political games and misleading the public" after it sued the state, challenging a Medicaid Enhancement Tax it pays to leverage additional federal grants to the state. For the third time, the state's hospital lobby has gone to court challenging the constitutionality of a state Medicaid Enhancement Tax plan that it claims cheats them out of $70 million in reimbursements to their members. Gov. Kelly Ayotte fired back a strong response, accusing the hospitals of being solely focused on 'playing political games and misleading the public.' The exchange reveals that a year later, Ayotte finds herself in the same place as former Gov. Chris Sununu, who engaged in a long public debate with hospital executives after he moved to divert some of their reimbursements to federally qualified health and substance abuse recovery centers. In 1991, the state imposed the Medicaid Enhancement Tax on hospitals to qualify the state for bonus matching grants from the federal government. Under the legal maneuver, the state pays back the hospitals for nearly all that they paid out in taxes, often on the same day. Under the arrangement, the state receives more than $300 million in annual reimbursements from Washington that it must spend on the federal/state Medicaid program of health care for the poor, disabled and many senior citizens. The Biden administration ordered New Hampshire and all states to change these so-called disproportionate share hospital payment plans. Federal officials are requiring states to make direct payments to the hospitals to receive the qualifying federal help, rather than impose a tax on hospitals and then pay them back. This suit charges the state is violating the 'takings' clause of the U.S. and state constitutions because the Medicaid Enhancement Tax is imposed on all net patient revenue but then hospitals are being reimbursed only for services provided to New Hampshire residents. For example, 40% of Dartmouth Health's patient revenue comes from care of out-of-state residents, the suit said. 'The DH Providers are paying taxes on revenue generated from services for which New Hampshire will no longer provide reimbursement,' said the six-count suit filed in Merrimack County Superior Court. The dispute in 2024 was over Sununu's insistence that at least 9% of what comes from the Medicaid Enhancement Tax go not to hospitals but be given to other Medicaid providers the former governor said struggled to thrive. April 15 was the date for hospitals to pay the tax, which triggered the lawsuit, according to Steve Ahnen, president and CEO of the New Hampshire Hospital Association. 'With no resolution in sight, hospitals have no choice but to file this lawsuit to protect access to important health care services for all patients,' Ahnen said in a statement. Hospitals sue state, claim Medicaid tax scheme cheats them out of $70 million Steve Ahnen, president and CEO of the New Hampshire Hospital Association, filed a lawsuit in superior court with member hospitals charging the new reimbursement scheme the state uses to leverage for itself federal grant money cheats them of up to $70 million they should rightfully receive back. 'The solution put forward by the governor embraces the punitive cuts to hospitals and the 80% distribution formula put in place by the prior administration. Under that formula, hospitals lose $70 million annually, to the benefit of the state, and at the expense of patient care in local communities." Joining the NHHA in its lawsuit was Dartmouth Health and Concord Hospital, along with its affiliate hospitals. Attorney General John Formella's office issued a statement that the state is prepared to fight the suit in court. 'The state is fully committed to ensuring access to quality health care while protecting taxpayer resources," Formella's office said. Ayotte said her last offer would have increased grants to all 26 hospitals and provided added benefit to the more than a dozen 'critical access hospitals' that provide care in underserved parts of the state. 'Unfortunately, the plaintiffs are only focused on driving more money to billion-dollar corporations and have resorted to playing political games and misleading the public," she said. "They should return to the table and come to an agreement that benefits all Granite Staters.' Ahnen pointed out that in the past two superior court judges found the Medicaid Enhancement Tax to be unconstitutional and an agreement only came about after hospital executives returned to the table to hammer out a compromise with state officials. 'This year, the MET is anticipated to generate $348 million; that funding will be used to bring $485 million in additional federal funding to New Hampshire to support the State's Medicaid Program,' Ahnen said. 'Without a new agreement the state would have to look to the general fund to finance the Medicaid program.' By not getting what they requested, the hospitals could see restrictions on services that affect all New Hampshire families, Ahnen said. 'This tax increase will cause hospitals to lose $70 million and will have a rippling effect on their ability to deliver health care services to the communities who depend on them and will harm the ability of patients to get the care they need, when and where they need it,' Ahnen said. 'This will force hospitals to make decisions about the services they are able to provide.' Leading Senate Democrats blamed Ayotte for putting at risk as much as $400 million in federal grants. 'This would be catastrophic to our state's healthcare system — the cost of healthcare for every Granite Stater will skyrocket, and hospitals, the largest employers in many communities, would be forced to cut services and potentially even close entirely," said Senate Deputy Democratic Leader Cindy Rosenwald of Nashua. "This could have been avoided altogether had the governor led on this issue.' klandrigan@
Boston Globe
15-04-2025
- Business
- Boston Globe
Hospitals sue New Hampshire over tax that supports Medicaid
Dartmouth Health and Concord Hospital have also joined the lawsuit, which was filed in Merrimack Superior Court on Tuesday. It's not the first time hospitals have fought against the tax. A Superior Court judge Get N.H. Morning Report A weekday newsletter delivering the N.H. news you need to know right to your inbox. Enter Email Sign Up But the 2014 decision 'imperiled the existence of the Medicaid program,' according to the lawsuit, and hospitals reached an agreement with the state to keep raising funds. Some of the money went to meeting federal match requirements to fund the Medicaid program, and hospitals also received a portion of the money back in a reimbursement. Advertisement The state's latest agreement with the hospitals expired last June, and they were unable to reach a new agreement, leading to the lawsuit. Governor Kelly A. Ayotte criticized the lawsuit in a statement, and said the state had put forward a solution that prioritizes patients and protects funding for critical access hospitals, the state's small, rural hospitals that often have tighter margins. Advertisement 'Unfortunately, the plaintiffs are only focused on driving more money to billion-dollar corporations and have resorted to playing political games and misleading the public,' Ayotte said. 'They should return to the table and come to an agreement that benefits all Granite Staters.' But hospitals say the new reimbursement plan proposed by the state is unacceptable as it will cause them to lose $70 million a year, according to the lawsuit. 'This difficult decision was made after months of attempted negotiations with the state to convey the potentially devastating impact this loss of funding will have on our health system's ability to deliver patient care, at a time when the federal government is also threatening to withhold funding,' said Joanne M. Conroy, president of Dartmouth Health. Under the current tax agreement, Dartmouth Health provides 30 percent of the hospitals' total tax payments but would carry 75 percent of the lost revenue, she said. That's because the hospital serves patients from Vermont, who contribute to its revenue but aren't included in its reimbursement. Conroy said in the last three years Dartmouth, a nonprofit health system, has contributed $885 million in community benefits, including free and reduced-priced care and $682 million in uncompensated health care. Steve Ahnen, president of the New Hampshire Hospital Association, said the governor's proposal would impose 'punitive cuts' on hospitals, while delivering an additional $137 million to state coffers. 'It has an immediate impact on access to care,' he said. In recent years, hospitals in aggregate have received a 91 percent reimbursement, but the governor has proposed cutting that to 80 percent, according to Ahnen. Advertisement He said the loss would hurt hospitals, coming at the expense of patient care and benefiting the state. 'We agree that generating more revenue for the Medicaid program is a good thing because it allows us to invest in behavioral health or substance misuse or other services that are needed in the community,' he said. 'But to do so in a way that harms hospitals is absolutely the wrong approach.' According to Ahnen, the hospitals' payments of $348 million help generate $485 million in federal matching funds for the state's Medicaid program. 'We want to protect access to care for patients, and we think there's a way to do that,' Ahnen said. 'We're committed to finding a resolution that works.' Amanda Gokee can be reached at
