This week, the Maine Department of Health and Human Services sent an email notifying hospitals and other providers that their MaineCare payments will be capped starting next month. It’s the second year in a row that payments will be curtailed.
The caps are intended to address a $62 million shortfall, according to state officials. They’ll begin in mid-May and run until the end of the fiscal year on June 30.
Several providers are affected, including large chain pharmacies, out-of-state ambulance services, and hospitals — which face caps of up to 30%. The state will also withhold payment on hospital claims higher than $50,000. The president of the Maine Hospital Association, Jeff Austin, said that’s a substantial hit, given that many hospitals are already short on cash.
“Ya know, if you have cash reserves, you can sort of get by,” Austin said “But when you don’t, whose bills does the hospital not pay?”
At Northern Light Health, the vice president of government relations, Lisa Harvey-McPherson, said the caps are projected to result in $1.7 million being withheld each week.
“Or, a total of $12 million over the course of May and June,” she said. “That’s a significant number.”
Harvey-McPherson said the announcement about the caps came as a surprise — especially given that MaineCare was discussed during many public hearings and work sessions in the Legislature this year.
“At no time in all of this dialogue were hospitals notified that the department was in a difficult cash position, such that they would be capping and curtailing payments, similar to what they did last year, when they were very transparent,” she said.
Last year, the Department of Health and Human Services announced in February that it would cap MaineCare payments unless the Legislature passed the supplemental budget with a two-thirds majority so additional funding would be available immediately. That effort failed and the department capped MaineCare payments. But the issue prompted public debate among lawmakers and generated widespread news coverage.
This year, the announcement was issued the evening before the Legislature adjourned. Officials in the Mills administration dispute the criticism that they were not transparent.
This story appears through a media partnership with Maine Public.
