St. Raph’s defaults on $88 m in debt; imbalance in state funding blamed

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New Haven’s Hospital of St. Raphael is facing a $35.5m budget hole and cannot make payments on $88 million of debt, according to the New Haven Independent. The hospital is working with insurers who cover the debt on an emergency spending plan that includes closing an ambulatory center that now loses money (awaiting state approval to close), getting better deals from suppliers, closing their visiting nurse operations, billing system improvements, and reducing staff levels through attrition and not filling vacant positions. No layoffs are planned at present. The hospital is also considering the future of mental health services which lose $6.7 million through Medicaid every year.
One large part of the budget hole is that St. Raph’s is paid $1,812 less per Medicaid patient by the state than Yale-New Haven Hospital, only blocks away serving the same population. New Haven area legislators Sen. Toni Harp, Rep. Toni Walker and Rep. Pat Dillon are working on legislation to equalize Medicaid payment rates. HB-5419 would require the state to pay the same rates to hospitals in the same community. For historic reasons, Catholic hospitals are often paid less because rates were set when volunteer nuns and clergy provided care. DSS testified against the bill due to budget constraints.
Ellen Andrews