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Tax unlikely to affect local hospital staff

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By Kelly Mori, Staff Writer 4:08 PM Wednesday, November 25, 2009

SPRINGFIELD — A new state hospital tax that is being blamed for additional cuts at many Ohio hospitals will not affect staffing at Springfield Regional Medical Center, officials said Wednesday, Nov. 25.

Community Mercy Health Partners, which expects the new franchise fee, or “bed tax” to create a net loss of $2 to $3 million for the hospital over the next two years, had pro-actively worked the tax into the budget, said Jim Senese, Community Mercy spokesman.

“We don’t foresee any cuts at this time,” he said.

The franchise fee, which state legislators approved this summer, trades a 1.5 to 1.6 percent assessment fee on hospital facility costs over the next two years for increased federal reimbursement from Medicaid and Medicare — a net gain of $2.4 billion for the state’s struggling budget. It will cost Ohio hospitals a total of $718 million, according to the Ohio Hospital Association. The first payment is due Nov. 30.

The timing is especially bad, Senese said. “The recession is ongoing and uncompensated care, which includes charity care and bad debt, continues to increase for (Community Mercy).”

The local hospital system saw a $1 million increase in the amount of bad debt and uncompensated care in 2008.

A survey of Ohio hospitals, conducted by the OHA, reported that 18 percent of hospitals plan to lay off additional employees and 50 percent plan to leave future vacancies unfilled.

About 39 percent of hospitals plan to reduce or eliminate services, 50 percent plan to cancel or delay expansion or renovation projects and 64 percent will take additional cost-cutting measures.

The new Springfield Regional Medical Center, under construction downtown, will not be affected, Senese said.

“Certainly we can’t predict the future. We continuously look for ways we can be more efficient, while at the same time we honor our commitment to this community to invest in new technologies to improve patient care and expand services.

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