Wyoming medical providers ‘in crisis’ due to Medicaid reimbursement gap

Several hospitals in Wyoming are “on the brink” of closing due to the rising cost of medical care, state legislators heard last month.

“I’ve got two of my hospitals right now that have eight days cash on hand,” Wyoming Hospital Association president Eric Boley told the legislative Labor, Health and Social Services committee last month. “We have providers that are in crisis. We have nursing homes that have closed. … Expenses are getting so great (that) we can’t keep pace.”

The problem would be relatively simple to solve if hospitals could pass increased costs on to their customers like other businesses do, Boley said – but that’s not possible when working with Medicaid patients.

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“We can charge whatever we want, but we won’t get paid what we want,” he said. “Those are set rates.”

The Wyoming Legislature approved an increase to Medicaid reimbursement rates this year, and the state has been receiving an “enhanced federal match” due to the COVID-19 pandemic, Wyoming Department of Health director Stefan Johansson said – but before that, there were “several required cuts to the Department of Health,” and “a lot of those cuts were distributed to Medicaid providers.”

Just last year, for example, the legislature approved a 2.5 percent budget cut that affected “all allowable provider types in Medicaid,” Johansson said, and in 2017, a 3.3 percent reduction impacted “all of those provider types” again.

Wyoming Rep. Lloyd Larsen, R-Lander, said those earlier cuts were not restored as part of this year’s Medicaid reimbursement increase, which only represented a “re-basing” of a metric that hadn’t been updated since 2010.

Services ‘shrinking’

The WDH is working with medical providers throughout the state on strategies that might narrow the gap between medical costs and Medicaid reimbursements – without relying on an increase in state funding.

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Without some kind of solution, Boley said, “we’re going to start seeing a shrinking of the services that can be provided in our communities.”

For example, Ronda Meyer, the executive director for St. Joseph’s Children’s Home in Torrington, said her facility is supposed to be able to accommodate 62 clients, but they can only take 36 right now – despite a a 25-person waiting list – primarily due to staffing “challenges.”

“In order for us to retain our current staff, we have had to increase our wages 24 percent,” Meyer said. “We are finding ourselves having to compete with the private retail market – the McDonalds, the Walmarts, the Targets – on wages.

“And yet we expect our staff to work with the most vulnerable and fragile population in the state.”

St. Joseph’s is one of only two psychiatric residential treatment facilities for children in Wyoming, and Meyer said most of her clients are “severely emotionally disturbed,” having already experienced “four or five previous out-of-home placements such as foster homes, group homes, hospitalization and even jail.”

“These children have experienced significant trauma,” she said. “Many of them are victims of domestic violence and physical, sexual, or emotional abuse and neglect. Many of them have lost a parent due to death or incarceration, and many of them come from homes that are plagued with substance use and abuse.

“Through no fault of their own, these children exhibit severe emotional distress and often act out at home and at school. They experience paralyzing fear and uncontrollable anger. They often act out violently against others and even themselves. Many of them suffer from depression and anxiety. Some of them have even attempted (suicide).”

The severity of symptoms has risen “drastically” in recent years, she added.

“The violence, the illness – it has just grown astronomically,” Meyer said. “If we do not invest in the treatment of these children, they will end up becoming more difficult to treat and more expensive as they end up in our hospitals, detention centers and even our prison system.”

Trauma

Wyoming Sen. Lynn Hutchings, R-Cheyenne, asked whether Meyer has seen anything “in society” that might be leading to the increase in behavioral issues among children.

“(Are there) things that maybe we can do as a society or a community to help these young people?” Hutchings asked.

Wyoming Rep. Andi LeBeau, D-Ethete, offered her perspective on the question, specifically as it relates to children from the Wind River Reservation.

“You talked about trauma,” LeBeau said. “The historical trauma of the Eastern Shoshone and Northern Arapaho people was not a path of their own choosing.”

For more than 100 years, she reminded the committee, Native Americans in the United States were “systematically removed, forcibly, from their families and put into boarding schools,” where they were “treated like prisoners of war” and “punished for speaking their language and dressing in their traditional attire.”

“(It was) a whole generation of people that didn’t see a mom or dad cuddle or protect a child,” LeBeau said. “The only thing they learned (about) how to deal with conflict was silence, violence, or withdrawal. …

“That’s what we’re battling,” LeBeau said. “And it’s Wyoming’s children.”

Local kiddos

Three Fremont County children, including one from the Wind River Reservation, have been admitted to St. Joseph’s so far this year, Meyer said – almost 5 percent of the client total for 2022.

In 2021, she said St. Joseph’s served nine Fremont County youth, including three from the reservation, out of a total of 118 clients.

In 2020, seven Fremont County patients, including four from the reservation, were admitted at St. Joseph’s out of a total of 155 clients for the year, Meyer said, and in 2019, 11 local youth, including five from the reservation, were admitted out of 148 clients total.

The state’s other psychiatric residential treatment facility for children is at the Wyoming Behavioral Institute in Casper, which has served three Fremont County youth out of a total of 44 clients admitted so far this year, according to business development director Emily Genoff.

About 80 percent of clients at St. Joseph’s are Medicaid-eligible, Meyer said, while the Medicaid eligibility rate at the WBI facility is about 70 percent, according to CEO Mike Phillips.

The Labor committee plans to continue the conversation about the Medicaid reimbursement gap during its next meeting, which is scheduled to take place Aug. 11-12 in Casper.

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