Hospital stands to lose — a lot — in Raleigh decisions

By Vicki Hyatt | Jun 22, 2013

Tax legislation being discussed in Raleigh, along with the state’s decision to not expand the federal Medicaid program is projected to cost MedWest-Haywood $1.6 million annually, an amount that alarms CEO Janie Sinacore-Jaberg.

“How are we going to make that work?” she said. “I don’t understand this strategy.”

Sinacore-Jaberg said it is vital the community pays attention to the bills being considered during the final days of the General Assembly, particularly a provision that will have broad implicationa for not only the hospital, but all nonprofit organizations and churches in the community. At present, nonprofit organizations can apply for a refund on the sales taxes paid on items they purchase. This includes everything from office supplies to building materials used in capital projects.

In the case of MedWest-Haywood, the sales tax refund on the assortment of purchases amounts to about $1 million annually.

"But this isn't just about the hospital," Sinacore-Jaberg said. "It applies to all nonprofits — churches, the Red Cross. Then's there's the issue of not allowing charitable contributions to be tax deductible. What are we thinking here? How will these organizations be able to fulfill their missions?"

The state's decision to turn down federal funding that would allow 500,000 more people to become eligible for the Medicaid program, a government insurance program for the impoverished, is another one that will hurt medical care providers in the state, she said.

Under the act, the federal government would pay for all the additional costs of expanding Medicaid eligibility for the first three years, and thereafter, the state would pick up 10 percent of the cost.

Medicaid reimbursements to healthcare providers average about 85 percent of the cost of service, but it offsets some of the costs to hospitals, which must provide service to all who show up at the Emergency Department.

Sinacore-Jaberg pointed out the hospital setting is the most expensive for patient treatment. Increased eligibility could offer earlier access where patients could be treated before their disease or condition is dire.

"If we could expand the Medicaid program to cover those who are under insured or aren't insured now, we might be able to support other things we need to do," Sinacore-Jaberg said. "The fact is, we have paid into those federal funds, and we as a state are choosing not to take them."

Another issue that directly concerns Haywood residents is funding for behavioral health. There are currently 16 beds at the hospital where patients facing a mental crisis can be stabilized.

"Those beds are always full," Sinacore-Jaberg said. "We need more beds and funding to get the patients in the right environment. Now, many end up in the emergency department where they wait."
She said she meets regularly with the county's emergency medical personnel and the new sheriff on this issue because to better manage the increasing problems with the behavioral health system.

"The key message here is the community needs to stay on top of what's going on in Raleigh because it definitely impacts what is happening to healthcare in rural areas," she said.

Result will be satisfactory

Rep. Michele Presnell, a Republican who represents a portion of Haywood County, said there are two issues where the House Republicans are standing firm when it comes to differences with their Senate colleagues. One is the insistence that the sales tax rebate for nonprofits is left as is. The other the continuation of the income tax deduction for interest paid on mortgages.

"Tax reform and the budget have got to work together to balance," Presnell said. "We still have a lot of ideas on the table. I think people will be very happy with what we end up with."