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Each year hospitals pay the state $135 million which, through some mysterious alchemy, morphs into the federal government paying the state a second $135 million (to care for Medicaid patients).  Trying to decipher the magic a newspaper described a circular flow of money that seems to work like this:

1)     The hospitals pay the state $135 million;
2)     The hospitals then send the state $135 million in bills for caring for Medicaid patients;
3)     The state then sends Washington the $135 million in bills;
4)     Washington then sends the state a check for $90 million – its share of the Medicaid bills;
5)     The state then returns the original $135 million to the hospitals;
6)     And, finally, the state and the hospitals figure out how to divvy up the $90 million (from Washington) that’s left in the pot. 
That arrangement rolled along fine (for everyone but Washington) until this year when Governor McCrory proposed the hospitals send the state another $15 million without getting their money back – which didn’t sit well with the hospitals whose lobbyist announced they were in such dire need of cash the Governor’s plan might leave ERs with no choice but to, with deep regret, turn away patients.
A Democratic legislator also jumped into the melee accusing the Governor of taxing ‘sick people’ – which was pretty much the end of any illuminating debate.
I asked a friend who’s served on his local hospital board, Are the hospitals really broke?  and he said many rural hospitals – like his – are having a tough time making ends meet but the big urban hospitals – like Carolina’s Medical Center in Charlotte – own airplanes and helicopters and pay executives seven figure salaries (and don’t have to pay taxes on profits or pay property taxes). 
Of course, it wouldn’t be correct to say not taxing a hospital is the same as subsidizing it but, still, being tax free is helpful – so can the hospitals afford to do as the Governor asks and pay another $15 million?
What we need is a little clarity.
If a hospital’s strapped for cash I doubt the Governor (or even the State Senate) would mind lending a helping hand but, if, on the other hand, a hospital owns an airplane or helicopter, maybe it ought to provide a bit of proof it’s broke as a church mouse.



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2 comments on “Crocodile Tears?

  1. Anonymous says:

    Every time money changes between the state and the federal, it shrinks. I once saw a study that was conducted about the government giving poor famlies a pet, a dog or cat. The end results would be a cost of over $80,000 per family to provide this animal. Who in their right mind would want government in healthcare. As for me I would love to see communism take place here right away, so we could begin to see the damage and move away from it as quick as possible. This slow slide is torture.

  2. Anonymous says:

    Carter, how long has this mumbo-jumbo been going on? I’m sure it’s not just since McCrory got in office or since the repubs got control of NC State government. So, I’m kind of wondering why you haven’t made this point here in your presentation. But, nonetheless, I have some things to say about all this.

    First, if a hospital is supposedly a “non-profit” organization, then it’s incumbent on them to prove that they do not, in fact, make a profit.

    Second, It’s tough to trash a hospital for paying exorbitant salaries if those that are getting those salaries are actually worth it. A high-rated professional ball player that brings in 100 times more than he/she is paid deserves the high salary. A hospital administrator that keeps costs down, is instrumental in getting huge donations and insures the organization is run well deserves what he is paid. So, stop acting like a jealous left-winger that hates anyone that makes good money for doing a fabulous job, okay?

    Third, What’s the use of the helicopters and planes the hospitals use? I mean, let’s delve into these things before we just say because they have “goodies” they’re corrupt or don’t need this or that etc. I once had a new vet (way back in the day) and no way could I afford it. I didn’t need it. I sold it and got something more affordable. Are the helicopters needed? Planes needed? It’s a reasonable question.

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