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Olson votes against GAMC compromise

The Minnesota House is expected to vote this week on a compromise bill providing health care to the state's most indigent residents, sending it to Gov. Tim Pawlenty if identical to the Senate bill.

It passed the Senate on Thursday with a 50-17 vote. Since the measure will financially hurt already struggling rural hospitals, Sen. Mary Olson, DFL-Bemidji, was one of the 17 to vote against the measure.

Pawlenty "has a gun over our heads" involving MinnesotaCare, Olson said on the Senate floor Thursday night. The bill approved by the Senate and Pawlenty's plan would both bankrupt the health care program for the working poor, she said.

"The whole mechanism favors the metro area," Olson said late Friday in a telephone interview. "Even if all the rural hospitals did participate, there is a part of the bill that says that the three largest metro hospitals -- the hospitals that treat the highest percentage of GAMC patients - would get an extra 10 percent bump to their payments."

Pawlenty last year unallotted about $400 million to the General Assistance Medical Care program, ending it April 1. His solution would be to move those patients to MinnesotaCare, where they would have co-payments but the fund would be exhausted sooner.

The Legislature passed a bill earlier this session to keep GAMC intact but smaller, a bill that Pawlenty vetoed and the House sustained.

"The first option we passed wasn't such a great proposal, but at least it gave, for our hospital, a pretty good proposal," Olson said. "It gave us more money than even we were getting before for GAMC patients than even before any of this happened., simply because it captured some additional federal money. It rearranged the formulas in a way that it gave an extra benefit to hospitals that did have a high percentage of GAMC."

In a compromise with legislative leaders and Pawlenty, a new system would be set up starting June 1 in which hospitals and counties could form systems to coordinate health care. Similar to an HMO, the participating medical facilities would be given a lump sum for treating a GAMC patient, a sum that would have to handle all that patient's medical needs from chronic disease to dental work.

Most rural hospitals won't participate, Olson said.

Pawlenty "was forcing us to choose between bankrupting the MinnesotaCare program or going along with his bill," she said.

Olson said she asked three different times on the Senate floor why Republicans think the new bill is better than the earlier one approved by a wide bipartisan margin. "None of them could explain why this is a better option."

Senate Minority Leader David Senjem, R-Rochester, "made a half-hearted attempt to defend the bill," Olson said. "It's interesting that all of our hospitals outside of the metro area have contacted us ... and they've all said of this pool of money that's being set aside to pay GAMC participating hospitals, which will have to become coordinating care organizations, after six months, they can't participate.

"They believe that they will not be able to participate," Olson said. "They'd be better off just not getting paid, and not take on the responsibilities they'd be forced to assume through this CCO."

Olson said participating facilities would get paid one set price, most likely 23 percent of the reimbursement rate they received previously. The previous system was paid on the basis of a service rendered. The new system is a single payment to pay for the total care of the patient.

"You'd be asking the hospitals to act, more or less, like a health plan and assume all the risks for that patient," Olson said, including dental care, coordinating with Social Services, outpatient care."

"This isn't a workable solution for us," Olson said, quoting from an e-mail from North Country Regional Hospital.

Olson said Sen. Yvonne Prettner Solon, DFL-Duluth, said on the floor that "she didn't think we shouldn't be gutless in standing up to the governor. I then made the remark ... about the governor having a gun to our heads over the MinnesotaCare issue."

Mayo Clinic in Rochester wrote a letter stating that as coordinated as that clinic is, it would not be able to follow the model that is anticipated in the bill for the amount of money the state provides.

"The sad end result of this appears to be that the only place that care will be available for low-income, very sick people is going to be down in the metro area," Olson said.

She theorized that a GAMC patient arriving at North Country Regional Hospital would be treated in the Emergency Room if care is urgent, and costs would have to be eaten by the facility. If the patient has non-life threatening problems, the hospital would seek a way to transport that patient to a facility in the Twin Cities that is a participating CCO.

"In discussion of this, there are some people who think this is an OK option," Olson said. "Or better than nothing. But from a rural perspective, I'm not sure that is better than nothing."

People who are sick want to be near home, friends and family, she said. "You're potentially taking people away from where they live and might have family available. ... It just seems like a poorly thought-through proposal."

Money from MinnesotaCare surpluses will be set aside in a pool for uncompensated care, but Olson said that participating hospitals must be in the coordinated care system a least six weeks first. "The fewer hospitals that participate, that money just stays in the pool for those that are participating. "

Rural hospitals are not in a position to assume risk through the CCO, she aid. "That would mean that we just take the money that we used to have available to pay for GAMC, reduce it by a large percentage, and then just send it to those few hospitals in the metro area. There will be more money for them, and probably no money available for hospitals around the rest of the state."

Olson said she offered two amendments on the floor to change the bill, but was unsuccessful.

One amendment would have eliminated the 10 percent "bump" to the metro's three largest hospitals. "It meant that much less for everyone else," she said.

A second amendment would have allow institutions that can't become a coordinating care organization to keep the money allocated to that institution, based on 2008 rates, in a pool with a percentage of that institution's GAMC care paid out of that pool.

"It wouldn't default down to the metro area," Olson said. "It came within a few votes of passing."

Says Olson: "I wish our options weren't between very bad and very bad."