6 Mass. hospitals to sue state over payment shortfalls

The Boston Globe reports:

Six community hospitals, squeezed by the economic downturn and the Massachusetts budget crunch, are set to file a lawsuit in Suffolk Superior Court this morning seeking millions of dollars from the state for unpaid health care services.

The suit charges that Massachusetts violated a law requiring adequate reimbursement to hospitals for patients insured by the government. The hospitals contend the state set repayment rates so low they do not cover the cost of such medical care.

The plaintiffs are part of a group of health care providers known as “disproportionate share hospitals,’’ institutions at which at least 63 percent of patients, mostly low-income or elderly, are covered by public insurance plans such as Medicaid or Medicare. Many of the hospitals are losing money, or barely breaking even, after taking on thousands of patients newly insured by public plans under the state’s 2006 health care overhaul.

The lawsuit, which names the state secretary of health and human services as a defendant, focuses on reimbursements from Medicaid, the state-administered program for patients who can’t afford medical care.

Great moments in socialized medicine.