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In West Virginia, State Budget Delays May Force Healthcare Providers To Close

train car containing coal
Magnolia677 via Wikimedia Commons

If you are a healthcare provider in West Virginia today – a dentist, doctor, counselor, therapist – and a Medicaid patient comes into your office for treatment, you might not get paid for seeing them.

In late April, the West Virginia Bureau for Medical Services sent a letter to 24,000 healthcare providers that accept Medicaid, warning them that if state lawmakers didn’t approve a budget quickly, there could be a delay in reimbursements for the cost of treating Medicaid patients. The language of the letter was vague, including no details about the potential impact on providers.

When asked for clarification, the state Bureau of Medical Services told West Virginia Public Broadcasting that no one was available to comment.

Kathy Szafra is president and CEO of the nonprofit Crittenton Services. She says eight out ten of Crittenton’s patients are on Medicaid.

“So when you are looking at a delay in payment of 80 percent of your revenue, that’s very significant,” says Szafran.

Crittenton is known for its work with young women who are at-risk, pregnant or parenting. According to its website, the agency makes mental health services available to about 30 percent of West Virginia’s population.

Szafran said that for many of Crittenton’s patients in all of their service areas, this is their only real option for receiving care.

But if lawmakers do not approve a budget before June 30 and Crittenton stops receiving Medicaid payments, then “the agency will have to self-sustain itself while the revenue grows, which is very difficult,” says Szafran.

Crittenton has an endowment, but Szafran said if they burn through it, then the agency, would become unstable in the long-term.

Szafran said to deal with potential funding issues, Crittenton will put a hold on hiring new staff, expanding new projects and taking on new clients. If the budget crisis continues and the payments are delayed for an extended period of time, then the agency will be forced to fire staff and close offices.   

But the letter from the Bureau for Public Health doesn’t just affect nonprofits.

“Nobody is there to back us up if we go under,” says Carol Buffington, a dentist who has a private practice in rural southern West Virginia. She says about 50-55 percent of her clients are covered by Medicaid.

“West Virginia Dental Association wants us all to take care of the children. That has to be our first priority,” she said firmly.

More than 90 percent of the children eligible for Medicaid in West Virginia are covered by the program.

If a budget isn’t passed by June 30, private providers will have to dip into cash reserves. For Bluffington, that’s her retirement. She says continuing to serve the children may cost her the business. Without the Medicaid payments, she could last “maybe 60-90 days,” she estimates.

Buffington serves on the West Virginia Medicaid advisory board and says she knew the letter was coming. She’s watched state revenues from taxes on coal and natural gas – a major source of state funds, dwindle over the years.

However, both Buffington and Crittenton’s Szafran wondered if the letter was “for real” or if it was just a political ploy to force legislators to reconvene and quickly pass a balanced  budget. In the meantime, the clock counts down as health providers wait to see what the final deal means for them.