Detroit Medical Center Officials Ask Michigan Governor for One-Quarter of New Federal Medicaid Funding
Detroit Medical Center CEO Dr. Arthur Porter on May 28 sent a letter to Michigan Gov. Jennifer Granholm (D) saying that the hospital system could avoid planned cuts in staff and services if the state transfers $86 million of the additional Medicaid funds it expects to receive to the health system, the Detroit News reports. The state expects to receive $367 million in additional federal funds under tax cut legislation (HR 2) signed into law May 28 by President Bush. However, Liz Boyd, a Granholm spokesperson, said the governor is unlikely to approve "one-time money on a structural problem" (Detroit News, 5/29). DMC -- which provides care to more than 25% of the state's Medicaid population -- on May 20 announced plans to reduce health care services at its Detroit campus, including closing 300 beds and laying off 1,000 workers to offset financial losses. The health system, the region's primary provider of indigent care, has lost more than $300 million in the past five years and spends about $130 million per year on indigent care. Under the center's plan, inpatient services will be eliminated at Detroit Receiving Hospital within 60 days, and people requiring inpatient care will be transferred to nearby Harper University Hospital. The hospital's emergency room will remain open for trauma care. Hutzel Women's Hospital will also reduce the number of deliveries to 3,000 per year from 5,700 in 2002. The plan is expected to save $40 million in 2003. Porter said the cuts are "temporary fixes to buy more time" while DMC lobbies for additional Medicaid payments and indigent care funding (Kaiser Daily Health Policy Report, 5/27). In response to that plan, the Detroit City Council on May 28 passed an emergency ordinance blocking the closure of Detroit Receiving Hospital and requiring DMC to maintain current staff, beds and inpatient care as required under contract, the News reports. Porter said that if the DMC receives some Medicaid funding, the ordinance would not be necessary and asked council members to support his efforts to acquire the funds. A task force commissioned by Granholm is expected to release long-term recommendations by July about improving Detroit's health care system. Further, the state is developing a federal health quality assessment program, which could result in $30 million in federal money for DMC, according to Boyd (Hall/Nichols, Detroit News, 5/29).
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