Insurance

Lawsuit: State cuts may put Memorial, SRHS in critical condition

Singing River Health System and Memorial Hospital at Gulfport are suing over what they allege to be Medicaid underpayments. SRHS in Pascagoula is pictured. The county-owned health system also has a hospital in Ocean Springs.
Singing River Health System and Memorial Hospital at Gulfport are suing over what they allege to be Medicaid underpayments. SRHS in Pascagoula is pictured. The county-owned health system also has a hospital in Ocean Springs. jcfitzhugh@sunherald.com/2013

Memorial Hospital at Gulfport and Singing River Health System claim in a lawsuit filed against the Mississippi Division of Medicaid that they have been shorted millions of dollars for treating Medicaid and uninsured patients, while other hospitals are being overcompensated by millions.

The Coast hospitals want a Hinds County Chancery Court judge to order that DOM follow state law in setting payments. The lawsuit says the state has the money to compensate participating hospitals based on actual costs as the law requires.

Memorial and SRHS, respectively owned by Harrison and Jackson counties, filed the lawsuit after DOM denied an appeal over payment amounts for 2014. The hospitals already have sued over 2016 payments and are awaiting the outcome of a state appeal regarding 2015 payments, a news release from the hospitals says.

They claim the total in underpayments is $25 million for Memorial and $21 million for SRHS.

For 2014 alone, the lawsuit says, the combined underpayment for the hospitals was $22 million. Meanwhile, the lawsuit says, Forrest General Hospital in Hattiesburg was paid $17.9 above its cost for treating Medicaid and uninsured patients.

“The inequitable disparities — including wide shortfalls for some and wide windfalls for others — are the direct result of DOM’s failure to follow governing Mississippi law in making distributions,” says the lawsuit, filed for the hospitals by attorneys Maison Heidelberg and Seth Robbins of Jackson. In all, it says, 10 hospitals in the same class were overcompensated, while 23 were shorted.

DOM has not yet responded to the lawsuit.

According to the news release, Harrison County has 35,000 uninsured residents, the second highest number in the state, while Jackson County ranks fourth highest with 25,000 uninsured residents.

“Memorial and SRHS are both public, not-for-profit health systems that serve as safety net providers for their communities and deliver critically needed care to all residents,” the news release says.

Memorial CEO Gary Marchand said in the news release: “With recent actions taken by the Division of Medicaid to deny payments, coupled with a recently announced plan to phase in any further payment adjustments over a 10-year period, important services are now at risk.

“For Memorial, the key services are mental health and access to primary care for the uninsured.”

The hospitals hope the lawsuits result in a more equitable funding formula from the state, said Kevin Holland, CEO at Singing River, who added that more money should be going to hospitals providing the most care.

Anita Lee: 228-896-2331, @calee99

  Comments