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Fort Scott hospital closing revives debate over Medicaid

October 6, 2018

FORT SCOTT, Kan. (AP) — The controversial issue of whether to expand Medicaid in Kansas has been revived after the announcement that another hospital in a small town will close by the end of the year.

Officials announced Monday that the 46-bed Fort Scott Mercy Hospital will close by the end of the year. That follows the closing of Mercy’s hospital in Independence in 2015.

Those who favor expanding Medicaid say the refusal to do so is harming rural hospitals that are struggling financially, The Kansas City Star reported . Officials with the Fort Scott hospital said reduced reimbursement from federal programs, particularly Medicaid and Medicare, was one of several factors leading to the hospital closure.

The upcoming gubernatorial election could determine how the Medicaid issue is decided. Democratic Sen. Laura Kelly and independent Greg Orman support expansion, while Republican Secretary of State Kris Kobach opposes it.

“This should not have happened. Simply put: if Kansas had expanded Medicaid, Fort Scott would still have a hospital,” Kelly said.

Kobach has in the past responded to Kelly’s push to expand Medicaid by saying, “And money grows on trees.”

The Legislature passed Medicaid expansion in 2017, but then-Gov. Sam Brownback vetoed it.

Some key Republican lawmakers continue to oppose expansion. Rep. Dan Hawkins, a Wichita Republican who chairs the House health committee, said expansion might help hospitals financially, but it wouldn’t save them.

Under federal law, states that expand Medicaid eligibility up to 138 percent of the federal poverty limit ($34,638 for a family of four) receive additional federal funds to pay for much of the cost of expansion. More than 30 states have expanded. Expansion would provide health coverage to an estimated 150,000 Kansans, and proponents also say it would help rural hospitals financially because the number of patients without insurance would decrease.

Mercy Hospital said it spent $2.56 million in fiscal year 2017 on uncompensated care, as well as the traditional charity care write-offs it must provide to maintain nonprofit status.

Mercy Kansas Communities Inc. took a $13.4 million annual loss, according to its most recent financial disclosure form filed in 2017. But the report said the Fort Scott hospital had annual revenue of $32.5 million and expenses of $21.8 million.

Under expansion, the Fort Scott hospital would have received an average of $2.7 million in revenue each year, according to the Kansas Hospital Association, which supports Medicaid expansion.

Hawkins said the future of rural health care will likely involve fewer hospitals and more “super clinics” that provide emergency room services and give access to primary care physicians with a few beds for overnight care.

“I think that model is really starting be talked about and I think we will probably see that move ahead to some degree,” Hawkins said.

Kobach has proposed starting a direct primary care system in Kansas where individuals would pay $50 a month for unlimited visits with their primary care physician. Orman also supports that system, with direct primary care coupled with catastrophic insurance coverage to reduce health costs and improve access to care.

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Information from: The Wichita (Kan.) Eagle, http://www.kansas.com

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