By Dan Ring
November 30, 2009, 11:53PM
BOSTON – The Holyoke Medical Center and five other community hospitals planned to file a lawsuit against the state in Suffolk Superior Court today, saying they are owed millions of dollars in reimbursements for care for the poor and disabled.
The lawsuit follows a similar suit filed in July by the Boston Medical Center, the state’s largest provider of health care for the poor.
According to hospital leaders, the state’s 2006 near-universal health care law is requiring the hospitals to treat more people with government insurance, causing additional shortfalls in reimbursements.
Hank J. Porten, president of the Holyoke Medical Center, said the lawsuit comes after negotiations with the state over reimbursements from Medicaid, a federal-state program that finances health care for the poor.
“We’re going to have the courts decide what is fair payment,” Porten said.
Dr. JudyAnn Bigby, the state’s secretary of health and human services, is the defendant in the lawsuit.
Juan Martinez, a spokesman for Dr. Bigby, declined comment on the lawsuit itself, but he said officials are confident that the state’s actions comply with all applicable laws and will be upheld.
Martinez said the state recently increased payments to disproportionate share hospitals by 10 percent, or $18 million, starting in November.
The six hospitals are among the state’s 18 “disproportionate share,” or safety net hospitals. The state categorizes hospitals as disproportionate share if at least 63 percent of their patients have public insurance such as Medicaid or is uninsured.
The lawsuit seeks damages from low reimbursements from Medicaid.
The hospitals said the state has violated a law requiring financial reimbursement equal to the costs of providing care to Medicaid patients.
The hospitals said the state has set reimbursement rates so low that many of them are facing severe financial distress.
The hospitals, also including the Berkshire Medical Center in Pittsfield, said they are owed about $70 million from the past three years of shortfalls in Medicaid reimbursements. The $70 million is the difference between the cost of care and the reimbursements received for Medicaid patients.
The $70 million shortfall has caused hundreds of layoffs, delays in capital projects and spending for equipment and millions of dollars in cuts to services, the hospitals said in a press release about the lawsuit.
Porten said it was a difficult decision to file the lawsuit.
“We hope to get some resolution in the payment process,” Porten said.
Only about 30 percent of patients at Holyoke Medical Center are covered by private insurance. Other patients are either uninsured or on Medicare or Medicaid.
The Holyoke hospital receives about 80 cents per $1 as reimbursements for Medicaid, he said.
The Holyoke hospital annually treats 250,000 outpatients, 7,300 inpatients and 45,000 in the emergency room. About 9,000 surgeries are performed each year, according to Porten.
At least 26 percent of patients speak a main language other than English.
The Holyoke medical center and its affiliates are by far the city’s largest private employer, with 1,200 employees.
Other hospitals that are plaintiffs in the suit include Signature Healthcare Brockton Hospital, Cape Cod Hospital in Barnstable, Merrimack Valley Hospital in Haverill and Quincy Medical Center.