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For months, hospital officials across Minnesota have been lobbying Gov. Tim Pawlenty and the Legislature to salvage the health insurance program for the poor known as General Assistance Medical Care, or GAMC. 

The governor and key lawmakers have agreed on a plan -- but hospital officials are now concerned that the funding won't be enough to treat the the 30,000 people who rely on the program. 

Even one of the biggest backers of GAMC, Rep. Erin Murphy, DFL-St. Paul, said hospitals will see less money under the proposed fix.

"We're giving them a really difficult hand to play," she said. 

Murphy and other lawmakers have been working for months to figure out some way to salvage the program before it was scheduled to end by the end of this month. 

They thought they had a solution when the House and Senate overwhelmingly voted for a bill last month. But Pawlenty -- who eliminated funding for the program last year -- vetoed the bill. 

After an unsuccessful veto override attempt and several closed door negotiating sessions, a deal was announced, but funding for the program was slashed to a third of what it was projected to cost before the veto.

"We're going to ask them to care for a population that we know is sick and are higher utilizers of health care and we're going to ask them to do it for less money," Murphy said.

In the past under GAMC, hospitals, doctors and other health care providers got a set fee for treating things like a heart attack, a broken limb or a stroke. The new plan changes that, said Geoff Bartsh who lobbies for St Paul's Regions Hospital.

"We're basically getting a block grant to treat all of the patients who would fall into this eligibility category, regardless of the conditions they present at the hospital." 

Bartsh said Regions will join a pool of 17 hospitals to become critical providers for GAMC patients. These so-called critical care organizations will split $71 million. 

Hospitals with high GAMC caseloads, like Regions, Hennepin County Medical Center and Fairview University Medical Center, are all likely to join the pool even though the funds from the state won't be as high as the payments they used to receive, Bartsh said.

"It is something that we're going to have to work with and live with. It's asking hospitals to do eight times as much with one eighth of the money and it's better of where we would be if we didn't have the veto," he said.

Tom Patnoe, president of SMDC Health Systems, which runs St. Mary's Hospital in Duluth, said he has serious concerns about the proposal and isn't sure if St. Mary's will join the pool of hospitals. 

"Doing nothing perhaps would be better than trying to create limited pockets of coordinated care organizations," Patnoe said.

First, he said St. Mary's is the only critical care hospital in northeastern Minnesota. That means it could become a magnet for GAMC patients. It also means that people on GAMC may be unwilling or unable to get to Duluth for care. 

"St. Louis County is a huge geographic area, and we have the third-highest percentage of GAMC enrollees in the state," he said. "Creating just one coordinated care organization for a broad geographic region like St. Louis County alone much less the entire northeast Minnesota is very difficult to imagine."

Patnoe said St. Mary's, like other hospitals, will continue to treat any patient who needs care, but he said he's not sure if enrolling in the coordinated care pool is best for his hospital. 

If St. Mary's opts out, the next-closest hospital for GAMC patients in northeastern Minnesota would be St. Cloud. 

Several rural Minnesota Democrats say they're concerned that metro-area hospitals stand to do better than greater hospitals under the proposal. They blame Governor Pawlenty for forcing them to take a bad deal in order to save the program. 

For his part, Pawlenty said GAMC in its current form was getting too expensive too quickly and the new proposal will better control health care costs.

Gallery

GAMC deal shifts costs to hospitals, health providers

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Poorest of the poor would lose their last benefits

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Tom Scheck

Author

But hospitals are skeptical the compromise plan will pay enough to treat the 30,000 people who rely on General Medical Assistance Care, which is scheduled to end April 1.

Minn. Senate to vote today on health plan for poor

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