The Indiana Hospital Association has weighed in with another federal suit against the state of Indiana and Gov. Evan Bayh's proposed Medicaid reforms.
The IHA, which represents 133 of the state's acute-care hospitals, announced last week that it filed a suit against the Indiana Family and Social Services Administration and the Indiana Office of Medicaid Policy and Planning. The group asked for a temporary injunction against the use of new Medicaid payment methods.
A trial has already been scheduled for March 22 and 23 in U.S. District Court in Hammond, Ind., in a similar suit filed by Methodist Hospitals' Northlake campus in Gary and six Gary physicians trying to stop the cuts.
"We believe our only recourse to prevent further financial distress to hospitals serv ing Medicaid patients is to seek an injunction against further application of these flawed methodologies," said IHA president Kenneth G. Stella. "These are violations of federal law and substantially weaken hospitals' abilities to serve their communities. The ramifications go well beyond just the Medicaid population, who need access to hospital services."
Mr. Bayh's proposal reduces Medicaid reimbursements to hospitals to 85% from 100% of Medicaid costs. The $60 million in cuts took effect at the beginning of this month (Feb. 14, p. 46).
Bayh administration officials have said they are bringing the Medicaid reimbursements in line with what the state can afford, arguing that Indiana has had some of the highest reimbursements in the country.
But the IHA said in its suit that the reduction in Medicaid payments could cost hospitals more than $160 million in the next year and a half.