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Hospital officials keep close eye on GAMC

WILLMAR -- Rice Memorial Hospital officials are keeping a close eye on legislative action that could decide the fate of General Assistance Medical Care and those patients who are covered by the program.

The Minnesota Senate voted Thursday to override Gov. Tim Pawlenty's veto to restore the publicly funded health care program for low-income single adults. A vote in the House could come as early as today.

Meanwhile, legislators are negotiating with the governor on how to salvage the program, which will otherwise be eliminated at the end of March.

The loss of GAMC would have a $700,000 to $800,000 annual impact on Rice Hospital's bottom line, said Mike Schramm, chief executive of the city-owned hospital.

"It's not insignificant by any means," he said. "There isn't any cut-and-dried solution for how to make up for this."

Across Minnesota, hospital officials worry that axing GAMC will swell the ranks of the uninsured, forcing them to turn to hospital emergency rooms as their only source of care.

"The real challenge for us at the hospital is acutely ill people showing up at the emergency room without having had primary care," Schramm said.

The Minnesota Hospital Association says the elimination of GAMC will severely damage the state's health care safety net for the poorest of Minnesotans.

Cutting coverage "is the worst thing you can do in the middle of a recession," Lawrence Massa, president of the Minnesota Hospital Association, said in a statement issued by the hospital trade group.

"People will still get sick and will be forced to access care in the ER, which is the most expensive place to get care," he said.

Hospitals likely will have to absorb the loss, which could put further strain on a system that's already stressed, officials said.

"Cost shifting, one way or another, comes into play," Schramm said.

The governor's budget proposal includes a provision to move some people on GAMC into the MinnesotaCare subsidized insurance program, but many GAMC recipients either won't qualify for MinnesotaCare or won't be able to pay the premiums and deductibles, Schramm said.

GAMC "is the lowest of the low-income programs," he said. To be eligible, recipients must have an annual income of less than $8,000.

A compromise measure to keep the program partially alive would have resulted in less of a loss to hospitals -- $200,000 to $300,000 a year less in Rice's case -- but was ultimately vetoed by Pawlenty.

"It wasn't a long-term fix, but at least it was keeping the program in place," Schramm said. "Certainly keeping the program intact is better for everybody. ... I don't know where it's going to go from here."

Anne Polta

Anne Polta covers health care, business/economic development and general assignment. Her HealthBeat blog can be found at Follow her on Twitter at @AnnePolta.

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