Months after the Legislature passed a law directing millions to Mississippi’s struggling hospitals, not one has received that money, and far fewer than predicted will receive any money at all.
That’s because lawmakers erred in writing the statute, according to State Health Officer Dr. Daniel Edney.
Legislators in February established the Mississippi Hospital Sustainability Grant Program, which was supposed to disseminate $103 million in grant money to hospitals via the state Health Department. Despite a record state budget surplus, it was millions less than the state hospital association had asked for, but hospital leaders agreed it would help keep them afloat.
However, somewhere in the legislative process, the source of the funds was changed from the state’s general fund to federal COVID-19 relief dollars, which come with regulations. Because many of the state’s hospitals have already claimed some form of pandemic relief funds, those hospitals are ineligible for the money – an issue that lawmakers apparently did not consider.
“Unfortunately, you picked the wrong pot of money,” Edney told legislators at a Joint Legislative Budget Committee meeting on Sept. 29.
But lawmakers are placing the blame back on the Health Department, which was awarded $700,000 to disburse the money.
“Effectively you’re cutting out two-thirds of the hospitals,” Lt. Gov. Delbert Hosemann said.
“I’m not cutting out any,” Edney refuted. “The program is cutting out two-thirds.”
A spokesperson for the Mississippi State Health Department confirmed to Mississippi Today that 75 hospitals, about two-thirds of the state’s hospitals, have applied for the money.
Edney said at the meeting that only half of those facilities will receive anything.
Rep. Trey Lamar, a Republican from Senatobia, asked for a list of hospitals eligible to receive the money. Edney said it was “at the office,” before clarifying a few minutes later that he’d asked agency auditors and accountants to make an official document explaining the program and its challenges and would soon provide that to lawmakers.
When asked by Mississippi Today about the previously referenced “list,” Edney would not provide it and said it was still “fluid.”
“Let me be clear: Are you announcing to the public today that the hospitals, as it stands now, are not going to be awarded these funds we put in place?” Lamar asked. “Do the hospitals know this yet?”
Edney replied that he has been talking to hospital CEOs “one by one.”
Paul Black, the recently retired CEO of Winston Medical Center in Louisville, told Mississippi Today in May that he was disappointed in the failures of the grant program’s appropriations bill.
“Most everybody knows the challenge,” he said.
The extent of the program’s challenges apparently came as news to the legislators, though. Hosemann was at least aware of the issue in May when Mississippi Today reached out to him and published a story about how the federal funding was impacting hospitals’ ability to access the money.
Lamar, the chairman of the powerful House committee that deals with tax policy, and Hosemann, who announced a broad plan during this year’s session to help the state’s failing rural hospitals that included this grant program, appeared especially frustrated.
“As recently as a month or two (after the session), I contacted your office and it was 85% (of hospitals) were gonna qualify,” Hosemann said. “So this has been some administrative change that we were not aware of either during the session or shortly thereafter.”
Lamar, too, questioned why these issues were coming up months after the program’s inception. The governor signed the bill in April.
“There was no secret what we were working on,” he said.
Edney maintained that the Health Department brought up concerns about the source of the money during the legislative process.
“Believe me, Mr. Chairman, I’m extremely frustrated with this,” Edney told Lamar.
Edney gave the lawmakers a few options.
They could wait to distribute funds after fixing the program when the 2024 Legislative session starts in January, or they could activate the program now and send out the money to the roughly 38 hospitals that qualify. Edney also claimed there was a way to get the federal American Rescue Plan Act funds to all hospitals, but the current statute would have to be changed to do that.
Hosemann previously told Mississippi Today that he would support legislation at the beginning of the next session to make up the difference between what hospitals were supposed to get and what they actually got from the program.
Edney’s recommendation at the meeting was to dole out the money to the hospitals that are eligible because of the state’s dire health crisis. Those hospitals report losses upwards of half a billion dollars, he said.
One report puts nearly half of the state’s rural hospitals at risk of closure. At least one hospital has already closed this year, and several have applied for a federal designation that would slash services in order for more money. He said many more hospitals are reducing the services they offer to cut costs.
But Edney was adamant that he could not make the final call.
“Y’all need to make that decision,” he said. “I need to be given direction.
“The heartburn for me is I know activating the program as it stands is not what y’all intended,” Edney told the committee, before Hosemann cut him off, asking for data from the agency to make an informed decision about what to do next.
Edney still hasn’t been told what to do, he said in an interview with Mississippi Today on Tuesday.
“I know that (the Legislature’s) desire is to get funding to hospitals the quickest way that they can,” he said. “The options are before them and they’ll decide. They’re still evaluating information being given.”