CHARLESTON, W.Va. -- West Virginia's health insurance program for the poor is under siege from hospitals and doctors who say the state doesn't pay them enough to care for the sick.
The state Medicaid program, which uses a mix of state and federal dollars to provide insurance to 270,000 low income West Virginians, now has been threatened with at least two lawsuits alleging it significantly underpays doctors and hospitals.
The latest came Thursday from Appalachian Regional Healthcare Inc., the not-for-profit parent company of the Beckley ARH Hospital, which is the third-largest employer in Raleigh County.
About a quarter of the Beckley hospital's patients are on Medicaid. Currently, the state reimburses the hospital 67 cents for every dollar in care the hospital provides to the 17,000 Medicaid patients it sees each year.
Beckley ARH officials said if the conditions continue the hospital will have trouble buying new equipment, keeping staff pay competitive and even staying afloat.
"We can't continue to exist in a world where nearly one quarter of our patients pay us at 67 percent of our cost," said the Beckley hospital's CEO Rocco Massey.
Health care providers - hospitals large and small and individual doctors - have long complained about the poor payouts of government-run programs like Medicaid and Medicare, the federal program for the elderly.
At ARH, Massey said the state's Medicaid payments have not kept up with inflation.
There is, he said, an "ever-increasing gap between what we're paid and the cost it takes us to provide the service."
Allegations of underpayment by West Virginia's Medicaid program seem to have a hit a tipping point in recent weeks.
In mid-October, the West Virginia Primary Care Association, which represents community health centers, said it would sue the state because its network of centers and clinics is "grossly underpaid" by Medicaid.
Also last month, the University of Virginia Health System announced it would stop taking Medicaid patients from West Virginia because this state's payment rates are "substantially below cost."
Massey said pressure has built up after years of chronic underpayment.
"You're going to see more and more lawsuits," he said.
Right now two groups end up footing the bill because government programs underpay for care: hospitals' bottom lines and people who have private insurance. As government insurance rates hold steady, hospitals have less money to invest in new equipment and private insurance companies are asked to pick up the tab, result in a so-called "cost shift."
Delegate Don Perdue, D-Wayne, who chairs the House Health and Human Resources Committee, said raising Medicaid reimbursements rates in West Virginia by a "fair amount" would help the state by doing two things.
First, Perdue said, doctors who are hesitant to take too many Medicaid patients would change their ways. Doctors have to keep their number of private insurance patients relatively high, lest they be unable to pay their own bills because of underpayment from the government programs. If Medicaid paid more, they would be able to take more Medicaid patients.