Feb 08 2002

SHELBY ASKS PRESIDENT TO RESOLVE ALABAMA MEDICAID ISSUES

WASHINGTON, DC - U.S. Senator Richard C. Shelby (R-AL), today called on President George Bush to seek a quick resolution to outstanding issues affecting Alabama Medicaid recipients.

In a letter to President Bush, Senator Shelby requested his assistance in resolving an outstanding dispute with the State of Alabama and the Department of Health and Human Service's Office of Inspector General regarding Medicaid funding received by the State. The Inspector General has determined that the State miscalculated the federal portion of Medicaid payments and has recommended that the federal government recoup the federal share of these enhanced payments which totals approximately $240 million. The State of Alabama continue to dispute this.

In addition, despite federal approval in 1996 and 1999, Alabama has been told by the Centers for Medicare and Medicaid Services that their Partnership Hospital Program waiver will not be re-approved when it expires February 28, 2002. Senator Shelby is concerned that this impasse will result in a significant loss of Medicaid funding, as well as health care services, for the citizens of Alabama.

"I am deeply concerned with the impact this dispute will have on the citizens of Alabama," said Shelby. "I hope the President will step in and work with the State of Alabama to reach a compromise so we may prevent the loss of necessary health care services for needy citizens."

A copy of Senator Shelby's letter is attached.

President George W. Bush

1600 Pennsylvania Avenue

Washington, DC

Dear Mr. President,

I am writing to ask for your assistance on two matters that are critical to the State of Alabama's ability to ensure that its most vulnerable citizens obtain adequate healthcare services.

The first issue concerns enhanced payments made by the state Medicaid agency to hospitals. In a recent report, the Department of Health and Human Services's Office of Inspector General stated that these enhanced payments were calculated in an improper manner and recommended that the federal government recoup the federal share of these enhanced payments which totals approximately $240 million. The State of Alabama strongly disagrees with this conclusion.

The second issue concerns Alabama's Partnership Hospital Program (PHP) which has been in effect since November 1996. Despite federal approval in 1996 and again in 1999, Alabama has been told by the Centers for Medicare and Medicaid Services (CMS) that their PHP waiver will not be re-approved when it expires on February 28, 2002.

I am deeply concerned about the impact the above actions will have on the State of Alabama and its citizens. If the State is forced to repay $240 million and the Partnership Hospital Program is dismantled, it faces an aggregate loss of $1.2 billion in Medicaid funds. Clearly, in the absence of a compromise, this could have a dramatic impact on the level of services Alabama would be able to provide to its most vulnerable citizens.

Mr. President, the Alabama delegation has been very involved with trying to get CMS and the State to reach a compromise. Unfortunately, these extensive efforts have not yielded a resolution. With the expiration of the PHP waiver approaching quickly, I urge the Administration to intensify efforts to negotiate a settlement to this dispute that is both mindful of the needs of Alabama's Medicaid beneficiaries and the State's financial situation.

Sincerely,

 

Richard Shelby