Lake Cumberland Regional Hospital (LCRH) will receive just over $ 11 million as part of a larger settlement that Kentucky has reached regarding a 13-year dispute over Medicaid’s repayment rates.
Kentucky and the federal government will pay $ 383 million to settle with 54 rural hospitals that said they are underpaid by Medicaid, Governor Andy Beshear announced on Wednesday with Senate majority leader Mitch McConnell. The state portion will be $ 93.9 million and the federal government, which provides most of the Kentucky Medicaid money, will pay approximately $ 289 million.
The previous administration had allocated approximately $ 425 million in state funding to resolve the case. The governor said the settlement saved the state over $ 300 million and immediately provides long-awaited funds to rural hospitals.
Beshear said Senate majority leader Mitch McConnell helped draft a resolution with the Federal Centers for Medicare and Medicaid services. Medicaid is a federal-state health insurance program for the poor and disabled.
“Funding is an indispensable aid for our rural hospitals and for healthcare professionals who have been at the forefront of helping to combat the global pandemic,” said Governor Beshear. “The hard work of our office together with the support of majority leader McConnell and federal partners has resulted in millions of dollars in state savings and immediate payments for our rural hospitals. We plan to issue checks as early as next week.”
The dispute began in 2007 when a group of rural hospitals filed a protest over a change in reimbursement that has been in existence for several years. A lawsuit followed in 2013. Hospitals claimed that the Kentucky Medicaid rate-setting methodology was invalid and the Franklin Circuit Court and the Kentucky Court of Appeals agreed. The case is pending before the Kentucky Supreme Court.
Earlier this year the Beshear government asked CMS to exercise its authority to dedicate federal Medicaid funds due to rural hospitals. Following a request from the Beshear administration, Senator McConnell’s office contacted senior officials from the United States’ CMS and Department of Health and Human Services reiterating the importance of a swift and positive decision for rural Kentucky hospitals. .
On April 3, the governor of the Senate and McConnell majority, McConnell, announced that the Centers for Medicare and Medicaid Services (CMS) have approved Kentucky’s request to recover federal Medicaid rates and provide federal funds for a payment.
“In the midst of the coronavirus crisis, I am proud to work with the Trump Administration and Governor Beshear to provide urgently needed resources for over 50 of Kentucky’s rural hospitals,” said McConnell. “As the only non-New York or California congressional leader, I work constantly to direct national attention and federal resources to rural America, especially Kentucky. The medical professionals at our rural hospitals have shown their courage and dedication every day in all this pandemic, and it is my privilege to thank them and support them “.
LCRH is expected to receive $ 11,070,140. When contacted, hospital officials sent the Commonwealth Journal to the Kentucky Hospital Association.
Ginger Dreyer, KHA’s director of communications, said the organization was not part of the litigation, but was happy for everyone involved.
“This deal is important because with 30% of Kentucky hospital patients generally covered by Medicaid, which historically has paid hospitals around 25% less than the actual cost of treating these patients,” said Dreyer, “the payment of the government and reduces the capacity of hospitals to cover expenses and weaken the long-term sustainability of Kentucky hospitals.
“The upcoming settlement at this time will also help Kentucky hospitals as they face further losses from the fight against COVID-19.”