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Study: Fed cuts imperil 3K Maine hospital jobs

September 13, 2012 | last updated September 13, 2012 11:07 am

Unless Congress can trim the federal budget before across-the-board cuts go into effect next year, Maine's hospitals are set to lose $21 million and nearly 3,000 jobs, a new study contends.

The Bangor Daily News reported that the study, prepared for the American Hospital Association by the Pittsburgh-based consulting firm Tripp Umbach, measured direct job losses as a result of $10.6 billion in Medicare cuts that are set to go into effect next year and last to 2021 if Congress can't devise an alternative deficit reduction plan.

The automatic cuts set to go into effect were the result of a long battle in Washington over the federal debt ceiling that led to the formation of a "super committee" of lawmakers who failed to find the $1 trillion in savings now set to be cut automatically from federal departments if Congress can't find another solution.

The Maine Hospital Association told the BDN that the Medicare cuts would cost Maine hospitals $230 million over the eight-year period that the cuts are now set to be in effect. That loss comes on top of deductions in Medicare reimbursements that the MHA reports are expected to cost Maine's hospitals $879 million from 2011 to 2019.

Already, Maine hospitals are facing financial challenges demonstrated by a string of recent mergers, buyouts and layoffs, and the MHA reported that at least seven hospitals have announced layoffs of over 125 employees this year.

And since 2009, the state's debt to Maine hospitals has grown to around $450 million, a debt that Gov. Paul LePage reportedly hoped to address in a special fall session of the Legislature, according to the Associated Press. Those plans were scuttled, according to the BDN.