Tennessee delegation asks for hospital funds extension

Erlanger Hospital is seen from UTC's new library's in this Dec. 9, 2014, photo in Chattanooga.
Erlanger Hospital is seen from UTC's new library's in this Dec. 9, 2014, photo in Chattanooga.

Nine members of Tennessee's congressional delegation are appealing to federal officials for an extension of funds to help hospitals care for tens of thousands of low-income patients.

The lawmakers say they plan to use the extension to find a "permanent solution" to Tennessee's chronic problem of having to reapply every single year for the millions in funding that hospitals say is crucial to their bottom line.

All states participate in the federal funding program, which is known as the "disproportionate share hospital" fund, or DSH.

But because of the wording of a 1994 waiver that created the TennCare program, Tennessee is now the only state in the nation that requires a year-by-year renewal of the program.

Every year, that means hospitals feel fresh anxiety that the funding will lapse. And it has. In 2013, when the government shut down in October, Tennessee's DSH program was not renewed, throwing the state's hospitals into turmoil over the possible loss of millions in funding.

For Erlanger Health System, the loss of the funding added to the decision to freeze employees' vacation time this spring as the hospital faced the possibility of ending the year in the red.

"The disproportionate share funding is critical to Erlanger and other hospitals who serve those with the greatest need," said Steve Johnson, Erlanger's vice president of payer relations. He said the hospital takes in about $10 million in DSH money annually.

The funds eventually were restored through a temporary federal administrative "patch" in April.

Lawmakers hope to prevent such upheaval from happening again. But finding a permanent fix has not been easy; as such a bill will carry a much heftier price tag than a year-by-year renewal.

For the time being, the delegation is requesting an extension for the funding "to prevent any lapse in funding" that would threaten hospitals while the lawmakers seek "a permanent solution in the next Congress," according to the Dec. 19 letter to Marilyn Tavenner, administrator for the Centers for Medicare and Medicaid Services.

In the letter, lawmakers wrote that "we are deeply committed to restoring Tennessee's DSH funding, as our state is the only one in the nation without permanent access to these dollars."

The letter was signed by U.S. Sens. Lamar Alexander and Bob Corker, along with U.S. Reps. Diane Black, Chuck Fleischmann, Marsha Blackburn, Steve Cohen, Jim Cooper, John Duncan Jr. and Phil Roe.

"Tennessee hospitals are an integral part of their communities, providing $950 million in charity care and $720 million in unreimbursed costs in 2013," the letter said. "Despite the looming financial uncertainty, our hospitals have continued to provide quality care for our state's most vulnerable populations."

Rep. Scott DesJarlais, a South Pittsburg physician, and Rep. Stephen Fincher, a West Tennessee businessman, did not sign the letter.

Contact Kate Harrison Belz at kbelz@times freepress.com or 423-757-6673.

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