Conn. hos­pi­tals blame changes in state pol­icy for de­clin­ing in­come

Modern Healthcare - - REGIONAL NEWS - —Rachel Lan­den

Hos­pi­tals in Con­necti­cut cut more than 1,400 jobs in 2013 as op­er­at­ing in­come dropped $175 mil­lion for the year, ac­cord­ing to re­ports from the Con­necti­cut Hospi­tal As­so­ci­a­tion, which rep­re­sents 28 of the state’s 29 acute-care hos­pi­tals.

Last year’s 2% cut in Medi­care fund­ing as part of the federal se­ques­tra­tion and a $103 mil­lion drop in state fund­ing con­trib­uted to hospi­tal losses in the state, as did a change in the state’s hospi­tal tax pol­icy, the as­so­ci­a­tion noted.

In the past, Con­necti­cut hos­pi­tals paid a quar­terly state tax on net pa­tient rev­enue, but they re­ceived all of the funds back in the form of re­im­burse­ments. But in 2013, to help mit­i­gate a state budget deficit, $101 mil­lion of the tax was not re­turned to hos­pi­tals. For 2014, the amount the state will keep from the hospi­tal tax is es­ti­mated to be about $235 mil­lion, ac­cord­ing to the as­so­ci­a­tion. “The tax means pro­vid­ing care with even fewer re­sources, af­fect- ing ac­cess and ser­vices for all pa­tients,” the Walling­ford, Conn.-based or­ga­ni­za­tion said in a news re­lease. In ad­di­tion to elim­i­nat­ing 1,400 po­si­tions, last year’s drop in state re­im­burse­ment has meant re­duc­ing staff salaries and ben­e­fits, cut­ting back on ser­vices, and post­pon­ing in­vest­ments in tech­nol­ogy and in­fra­struc­ture, the as­so­ci­a­tion re­ported.

The ad­vo­cacy group is ask­ing law­mak­ers to phase out the hospi­tal tax over a five-year pe­riod.

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