Maine lawmakers appear poised to reject a bill directing the Department of Health and Human Services (DHHS) to reimburse hospitals in a timely manner for the services provided to MaineCare patients.
Under LD 331, sponsored by Rep. Gary A. Drinkwater (R-Milford), DHHS would be required to reimburse at least 75 percent of the as-filed settlement from cost reports within 90 days of receipt.
If approved, this would have brought the timeline for hospital reimbursements into alignment with the standard set for nursing homes in 2023.
Currently, hospitals often face delays in receiving payments for already-provided services, making it difficult for these facilities to cover expenses and meet the needs of their patients. Rural hospitals in particular have been feeling the squeeze in recent months as entire practice areas like OB/GYN are getting shut down, or hopitals closed altogether.
Maine’s major hospital networks have advocated in support of LD 331, citing the many challenges they face as a result of waiting years to be reimbursed for services that they have already provided.
“We incur the cost to provide care in real time — our doctors, nurses, medical procedures, clinical imaging — all of it,” said Northern Light Health. “And we are challenged when we wait years to receive the MaineCare settlement payments that we are due. This bill resolves the problem of delayed settlement payments.”
According to Northern Light, services provided to patients in 2024 under MaineCare are not paid for by the State until early 2026, a delay that they refer to as being part of the “predictable timeline” of MaineCare reimbursements.
Northern Light in particular expects to be paid $34 million in 2026 for services provided in 2024 and are due a total of $50 million for “acute hospital and provider services” from prior years.
MaineHealth reported facing similar difficulties, as they are still awaiting $40 million worth of reimbursements for services provided between October 2022 and September 2023. When combined with the payments they are owed for the 2024 fiscal year, the State has an outstanding balance of more than $100 million with MaineHealth.
“These are exceptionally challenging times in health care with many hospitals throughout the state having less than 30 days cash on hand,” said MaineHealth in March. “LD 331 would help to address cash flow issues by providing timely payment of care that again, and very importantly, has already been provided.”
Bill sponsor Rep. Drinkwater explained in testimony before the Legislature’s Health and Human Services Committee that Maine has carried a significant balance of MaineCare debt to hospitals in the past and expressed concern that the state may be “starting down that slippery slope again.”
In 2013, then Gov. Paul LePage (R) signed a bill into law that would set the stage for the state redirect $183.5 million from a then yet-to-be-negotiated wholesale liquor contract to help pay off the debt owed to 39 hospitals located throughout Maine.
When combined with about $300 million in federal funding unlocked by the plan, former Gov. LePage was able to pay off the State’s $483 million worth of debt owed to Maine hospitals for services provided under MaineCare.
Maine DHHS has pushed back on the Republicans’ recent effort to ensure that the state’s hospitals are reimbursed for their services in a timely manner, arguing that operationalizing its requirements would not be feasible given the agency’s current resources.
They went on to argue that in order to get ahead of their typical payment schedule, a one-time additional allocation would be necessary in order to avoid borrowing money from future fiscal years.
DHHS did clarify, however, that they are not opposed to the “concept of the bill,” only that it would not be practical without receiving additional monetary support.
Seemingly in response to these concerns, a group of lawmakers on the Health and Human Services Committee proposed an amendment that would have given the agency more than $135 million for the purpose of cleaning up their outstanding MaineCare debt with hospitals.
Despite this, Committee members remained divided along partisan lines over this legislation, will all Republicans supporting it and all Democrats opposing it.
This same partisan divided persisted in the House, where the majority Ought Not to Pass report was accepted by a roll call vote of 70-66.
The Senate has not yet voted on LD 331 as of the publication of this article, but it is likely that lawmakers in that chamber will follow suit and reject the proposed legislation.
Should that happen, the bill will be placed in the legislative files as dead and will not be considered any further this session.
