UNM Hospital expansion plans put on hold

Officials waiting on Medicaid talks

The University of New Mexico Hospital is holding off — for now — seeking final approval for its long-planned, $146 million hospital.

The proposed 96-bed hospital, which administrators say will alleviate overcrowding at UNMH, has been delayed for months by the New Mexico Board of Finance, whose members have said they do not have enough information to move forward.

UNM says it has cash reserves to fund the hospital, and that it’s needed to solve the above-average occupancy rate and long wait times for beds at UNMH.

Now, hospital and university officials say they will hold off on their efforts until negotiations are completed between the state and the federal government over Centennial Care, or the state’s Medicaid program.

“We’re just going to put this off for a little bit of time, wait until the (program) gets approved and see what the numbers are, then run them up through with the regents, run them through the board of finance,” hospital CEO Steve McKernan said Wednesday. McKernan said the administration thought it prudent to step back and wait until the federal government approves the state’s new program.

But President Bob Frank said another factor that will affect whether UNM goes back to the Board of Finance for approval will be how the new Sandoval Regional Medical Center performs.

“We feel like we need to make sure that Sandoval Regional is performing well before we push ahead on that, and all of our data says it is performing well right now, but we want to

make sure that we’re really strong,” Frank said last week. He said the new hospital had a couple of months with a low occupancy rate, but that it has since recovered.

McKernan said Sandoval Regional Medical Center in Rio Rancho is operating well and doesn’t affect what he called the desperate need for more beds near UNMH in Albuquerque. UNMH is the state’s only level 1 trauma center.

“I mean, we don’t see that as a reason to not go ahead with the project,” McKernan said.

Centennial Care, the state’s proposed new comprehensive Medicaid program, will replace numerous other programs previously used to provide Medicaid services to New Mexicans. But the federal government must give approval.

One component under negotiation is how much in supplemental payments to health care providers the state will pay. Already, the state has suspended payment of certain supplemental Medicaid payments to hospitals as it negotiates with the federal government.

“The (supplemental) payments in the whole state of New Mexico are probably going to be less than they have been in the past,” McKernan said. However, UNMH will receive more in direct payments as Medicaid expands under President Obama’s Affordable Care Act and insures more patients who previously may have required uncompensated care from the hospital, he said.

“Our calculations have showed that that will balance out, but we don’t know,” McKernan said.

The state is expected to get approval for Centennial Care this summer. After that, hospital officials will take a few weeks to crunch the numbers again before providing them to the UNM regents and the Board of Finance.

The proposed new hospital has faced pushback from Lovelace Health System, which recently said it was not needed. Also, Bernalillo County Commissioner Wayne Johnson has questioned whether the county should continue allocating $90 million in property tax revenue annually to UNMH.

Others, like Albuquerque Mayor Richard Berry and numerous Native American groups, have publicly supported the proposed hospital.