UNC Hospitals may not receive state appropriations

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For the first time since opening doors to patients in 1947, UNC Hospitals might not receive any state appropriations.

The N.C. General Assembly recently proposed eliminating its entire 2012 fiscal year appropriation of $44 million to UNC Hospitals. These funds are used to help offset the cost of uncompensated care.

For the 2011 fiscal year, UNC Hospitals was appropriated $32 million by the state government to offset an expected $306 million in uncompensated care, said Jennifer James, spokeswoman for UNC Hospitals.

“It is definitely disheartening that we will receive no appropriation from the state,” she said. “It has helped in providing many beneficial services for our patients.”

Care is considered uncompensated when a patient receives health care services but is unable to pay for them. This also happens when Medicare and Medicaid reimburse the hospital with less money than the services cost the hospital.

The elimination of state appropriations would mean that individual hospital departments must find ways to trim their budgets, which will be approved in May.

The state appropriation represents about 3 percent of the $1.8 billion revenue that UNC Hospitals collects, James said.

While the cuts will impact the ability of the hospital to fund a variety of expenditures, it will not impact core operations, she said.

“We are still going to see all patients, insured and uninsured,” James said. “There will be no hospital bill increase or staff layoffs. The quality of care provided will not be affected.”

Adam Searing, project director for the N.C. Justice Center’s N.C. Health Access Coalition, said it is unreasonable for the legislature to cut funds from UNC Hospitals.

“These are mean-spirited, morally wrong budget cuts. They devalue working people and the needs that they have,” he said. “I have listened to many people who drive all the way to UNC to get both quality care and qualify for health care, and these legislators are cutting one of the main things that help pay for care for these people.”

The N.C. General Assembly Fiscal Research Division said state funds are normally advanced to UNC Hospitals for a three-month period. Since the 1990s, UNC Hospitals has reimbursed the state for this money each September, after receiving a payment from the federal government for providing services to low-income patients.

Eliminating the funds would allow the state government to use the money elsewhere.

But James said UNC Hospitals will try to convince lawmakers of the value of their services in North Carolina.

“We definitely understand that the state has a difficult budget problem, and we accept our share of the reductions,” James said. “At the same time, we feel that the state’s investment in the UNC School of Medicine and UNC Hospitals is a great investment to the state of North Carolina.”

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