$764m in stimulus funding to go to healthcare services
CAMBRIDGE - Massachusetts will use $764 million from the federal stimulus package to shore up healthcare services and prevent further job and program cuts at hospitals that serve large numbers of poor patients, Governor Deval Patrick said yesterday.
The money, which is coming to the state through the Medicaid program, will also enable the state to preserve current benefits and eligibility levels for MassHealth recipients, and for residents who get subsidized health insurance under the 2006 law mandating insurance coverage.
A reserve fund will be set up to meet anticipated increases in demand for the programs driven by the economic downturn.
Other programs for people with mental illness and disabilities will also see an infusion of funds, as will public health, youth services, and agencies serving children and families, the administration announced.
"We've had to make cuts, that's true. But thanks to the recovery funds, we have softened some of the blow," Patrick told an overflow crowd yesterday afternoon at Cambridge Hospital. "We can't avoid every tough decision in health and human services . . . but we are doing everything we can to minimize the impact on the populations that depend on you and your government more in times like these."
Cambridge Health Alliance and Boston Medical Center are the two largest safety-net hospitals in the state, serving large numbers of poor patients covered by MassHealth, and they will receive $120 million of the $160 million in stimulus money going to hospitals in the fiscal year beginning in July. Both had said they would eliminate jobs, close programs, and consolidate other services after state budget cuts were made last fall.
Cambridge Health Alliance will receive $40 million from the stimulus package next month to restore a cut announced earlier this year, and another $40 million in the fiscal year that begins in July. The alliance, which also includes hospitals in Somerville and Everett, said in January that it would cut 300 jobs, discontinue inpatient services at Somerville Hospital, and close its pediatric and addiction units.
The new money, while welcome, will not restore those jobs or services, chief executive Dennis Keefe said. "If we didn't get these funds restored, we'd be looking at further impact on literally hundreds of jobs," Keefe said in an interview.
Boston Medical Center will get $80 million through the stimulus program next year, plus $64 million this year for services it provided in fiscal 2008 to low-income patients, as part of an earmark in the 2006 health insurance law.
Elaine Ullian, president of Boston Medical Center, said the hospital has suffered significant cuts in state reimbursement this year for the care of the poor and expects further cuts next fiscal year. The new money will not be enough to close its budget gap.
"What we do know is that there is a gap of $173 million between the expenses we incur and the payments we receive for treating Medicaid patients," Ullian said. "We're hopeful we can work with the administration to bridge this gap."
Liz Kowalczyk of the Globe staff contributed to this report. Elizabeth Cooney can be reached at lizcooney@gmail.com. 
