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OMC seeks state budget proviso to extend current Medicaid rate two more years

March 27, 2019 -
Loss of Medicaid extension will result in an estimated $1.5 million cut annually to state reimbursement
CLALLAM COUNTY – The one-year rural Sole Community Hospital Medicaid budget proviso passed by the Washington State legislature in 2018 has been so critical and essential for Olympic Medical Center, Grays Harbor Community Hospital and their respective communities, both hospitals are seeking another budget proviso to secure this additional funding for two more years.

"The current Medicaid reimbursement rates are still only 70% of the cost to provide care,” says Eric Lewis, chief executive officer, Olympic Medical Center. "Yet the current reimbursement rate for rural Sole Community Hospitals is very much needed to support access to needed services in Clallam County. Passing this budget proviso is vital for health care in our community”

Provisos are lines in the state budget that give temporary authorizations for the use of state money. In this particular case, OMC is asking for the state to include a budget proviso for Medicaid reimbursement for a two-year period, starting July 1, 2019, through June 30, 2021. A proviso typically contains language that also places conditions and limitations on the use of those funds. Olympic Medical’s budget proviso request would only pertain to rural Sole Community Hospitals, and only two hospitals qualify: Olympic Medical and Grays Harbor Community Hospital. 

"It’s important to understand that this is not an increase in profit for our hospitals,” says Lewis. "Medicaid still pays below the cost of care, but this improved rate gets OMC closer to a positive margin and allows us to adequately maintain services and increase access for patients in areas that have more patients on state insurance, such as primary care and pediatrics.”
OMC talking with legislators and asking for support

Leaders from Olympic Medical and Grays Harbor have been talking with Representative Steve Tharinger, Representative Mike Chapman and Senator Kevin Van De Wege about the budget proviso request for months. "Our three state legislators have been tremendously supportive of rural health care and we believe he understands our needs as a rural Sole Community Hospital,” says Lewis. "We believe he wants to help us, but the state budget is very tight and it is an uphill battle to gather the support needed in the House and the Senate. We are asking interested community members to participate in an email campaign to help inform select members of the legislature on why the current Medicaid rate OMC receives is needed.

More information on the budget proviso request, along with an email template and contact information, can be found at www.OlympicMedical.org/ProtectLocalHealthcare

OMC reliant on adequate government reimbursement

Olympic Medical Center is reliant on government reimbursement to maintain its ability to provide access to services in Clallam County. OMC experienced a $1.7 million cut in reimbursement for Medicare in 2019 and double to $3.4 million in 2020, and the current state reimbursement rate has since become a lifeline. 

As a community safety net hospital, OMC accepts all patients regardless of their insurance carrier and ability to pay. It does not and cannot turn away Medicare and Medicaid patients despite the lower reimbursement, and the losses incurred due to inadequate reimbursement affects patients equally. "If we are unable to afford a service due to poor reimbursement rates, we may not be able to offer that service like before and that affects all patients,” says Lewis. "We don’t want to have to make those types of decisions if we can avoid it.”

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