Harnett Dispatch

Harnett Health System Reports Over 24 Million Dollar Loss

After many months of rumors flaring about the financial stability and lack of ability to pay outstanding debt,  The Harnett Dispatch has uncovered  tax form 990 filed by Harnett Health system for the fiscal year that ran from October of 2012 to September 2013, the report shows that Harnett Health had a $24,374,390 loss.  Harnett Health owns and operates Betsy Johnson and Central Harnett Hospitals along with primary care physician practices in Angier, Coats, Dunn, and Lillington as well as OB/GYN and pediatric practices in Dunn.  Their outpatient centers include Lillington Rehabilitation (Lillington, NC), Benson Rehab/Wellness Center (Benson, NC), Wound Care Center (Dunn, NC), Breast Cancer Center (Dunn, NC), Outpatient Cardiac Testing (Dunn, NC), and Cardiac Rehabilitation (Dunn, NC).

Is Harnett Health another Victim of the Failure to Expand Medicaid?

In recent months, we’ve seen news stories about rural hospitals being hit by the failure of taking the Medicaid expansion money.  The governor and legislature have refused to expand Medicaid eligibility. Last month, the Vidant Pungo Hospital shut down in Belhaven, a town of around 1,600 located in North Carolina’s Inner Banks region. The closing was due at least in part to the state’s rejection of Medicaid expansion. Six days after the hospital’s closing, a 48-year-old woman died of a heart attack as she waited in a Belhaven school parking lot for a medevac helicopter to take her to the nearest hospital 84 miles away.

Medicaid has long been “the backbone of rural America’s health delivery system,” according to the Center for Budget and Policy Priorities. The consequences of rejecting Medicaid expansion can prove troubling—or worse—for small rural communities.

Expansion of Medicaid can hugely benefit rural areas by addressing insurance coverage gaps, especially given that rural residents tend to be less well covered than their urban counterparts with employer-provided health insurance. Medicaid expansion promises rural health providers much needed increased payment levels, which help struggling rural hospitals maintain operations against better-funded suburban and urban competitors.

How did our Legislative officials vote?

Rep David Lewis

Harnett County is represented by two North Carolina house members and one Senator, out of the 3 legislators only one voted to take the Medicaid expansion money that would help with rural hospital and expand Medicaid. Rep. David Lewis of Dunn was the only Republican in the North Carolina house that voted in favor of taking the Medicaid expansion money. In a report by Wral “Lewis described his third reading against not taking the expansion money as “a plea for help for rural health care.”

In a health committee hearing earlier this week, Lewis raised questions about the loss of “DISH” money, the bureaucratic slang for funding supplements that go to hospitals with a disproportionate share of patients who can’t pay their bills and don’t have insurance. The Affordable Care Act phases out DISH payments, but as part of a compromise on the federal level, proponents agreed to expand Medicaid so more patients would have health coverage. When the U.S. Supreme Court upheld the health care law last summer, however, it said states could not be forced to expand their Medicaid programs.

Without extra Medicaid payments to make up for the loss of DISH payments, Lewis said, rural hospitals like the one in his district will suffer. “I don’t like the extortion that’s being used to force states to take the Medicaid expansion,” he said. “But I wanted to bring attention to the fact that, if that money goes away, many rural hospitals, including the one I represent, will go into the red.” Nobody, he said, has been able to explain how the DISH money will be replaced. “It is significant,” Lewis said, adding that hospitals could either be forced to close or slash many of the services they offer to help keep people healthy as a result of the loss of DISH money.

Where did Senator Rabin & Rep. Mike Stone stand on the issue?

Rep. Mike Stone

House Member Mike Stone that represents both Lee and parts of Harnett voted in favor of not taking the Medicaid expansion money.

Senator Ron Rabin

Senator Ron Rabin who represents Harnett, Lee and a small portion of Johnston County not only voted in favor of not taking the Medicaid expansion money but is listed as one of the co-sponsors of the Senate bill that refuses to take the Expansion of Medicaid.

Why Medicaid Expansion?

North Carolina’s decision not to expand Medicaid coverage as part of Obamacare will cost the state nearly $51 billion in federal funding and reimbursements by 2022, according to research funded by the Robert Wood Johnson Foundation.

The nonprofit foundation focuses on improving public health.

It notes that North Carolina stands to lose $39.6 billion in federal funding between 2013 and 2022.

The decision also will result in $11.3 billion in lost reimbursements to the state’s hospitals by 2022, the foundation says. That includes a projected $1.1 billion in 2016.

By comparison, the 10-year total cost for North Carolina to expand coverage would be nearly $3.1 billion.

“States are literally leaving billions of dollars on the table that would support their hospitals and stimulate the rest of their economies,” says Kathy Hempstead of the Robert Wood Johnson Foundation.

The report notes that for every $1 a state invests in Medicaid, it will receive $13.41 in federal funds.

Expanding Medicaid also stands to generate state savings and revenues that exceed the costs tied to expansion. In addition, it would support job growth in the health-care sector, while increasing the number of individuals with health insurance coverage.

In total, 24 states have chosen not to expand Medicaid and will miss out on $423.6 billion in federal funding between 2013 and 2022. Hospitals in those states also will lose out on $167.8 billion in Medicaid reimbursement payments over that time, the foundation says.

The decision not to expand Medicaid coverage will leave 6.7 million U.S. residents uninsured in 2016. That includes 414,000 people in North Carolina.

Future of Harnett Health

Sources say that the administration of Harnett Health have been in talks with other health systems and organizations trying to agree on a partnership that will help them recover from such a loss.

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