The state will soon reduce how much it pays hospitals and doctors to treat Medicaid patients after Governor Nikki Haley signed legislation into law Wednesday. The act gives the Department of Health and Human Services the power to cut three percent from its provider rates.
Haley said it was a way to save money for an agency running up deficits of at least $225 million.
Taxpayers deserve the most health for their tax dollar. Where Medicaid is now overpaying for fees, we need the flexibility to correct this. Bottom line: this will save the taxpayers money.
South Carolina had been the only state that did not allow its Medicaid agency to control provider rates.
Hospitals opposed the change, offering instead to pay more in bed taxes. However, Haley and other Republicans rejected the offer, worrying the hospitals would just push the extra cost onto patients.
Officials say the cutbacks will save about $6 million immediately. However, opponents are afraid it could result in some smaller, rural hospitals shutting their doors. Haley said DHHS Director Tony Keck was working with those hospitals to prevent that.
Providers are not going to be happy because they are always going to want more. Our goal is to look out for the patients. Our goal is to look out for the taxpayers… We are not going to let rural hospitals suffer. What we are going to do is make sure that the patients are getting the health care they need.
Keck told legislators he hopes to eventually save around $125 million by averaging 10 percent cuts. The cuts would vary depending on the hospital’s situation.