It appears that Gov. Tim Pawlenty blinked.
A compromise state health plan for the very poor, on the verge of collapse just a few days ago, was rescued this week when the Pawlenty administration changed course and negotiated with participating hospitals to limit the number of patients each will see.
As a result, Hennepin County Medical Center and three other metro hospitals will participate in a slimmed-down version of General Assistance Medical Care (GAMC), a health plan for thousands of Minnesota's poorest and sickest residents. The four hospitals serve about 47 percent of the current 36,426 enrollees, none outstate. The remaining 144 Minnesota hospitals will treat patients and dip into a $20 million fund for that purpose.
The agreements reached Thursday were critical for Pawlenty because legislators are pressing hard to expand the federal-state Medicaid program to cover those patients -- a move he strongly opposes. A program in shambles would strengthen their hand.
With a limit of 9,400 patients a month and $32 million to finance their care, Hennepin County Medical Center and the Hennepin County Board voted Thursday to participate in the revamped program, which starts in three weeks. A few weeks ago, only one of the 17 key hospitals, Regions Hospital in St. Paul, had said it might participate.
The Hennepin County hospital cares for more than a fourth of all GAMC patients, far more than any other. Its agreement brought in three others -- Regions, North Memorial and the University of Minnesota Medical Center Fairview in Minneapolis. They will divvy up $71 million that was to go to the 17 hospitals. Other hospitals may join the program on Dec. 1.
First hint from Pawlenty
Until early this week, Pawlenty held firm against changes in the stripped-down health program, a compromise he reached with DFL legislators in March after vetoing a different extension of the 35-year-old GAMC.
Pawlenty gave the first hint of a policy change Tuesday in a letter to two DFL legislators, criticizing them for offering hospitals "false hope" of Medicaid expansion, and noting that Hennepin County that day had voted not to participate "despite the caps on enrollment" offered by the state.
That was news to Hennepin County negotiators, who had sought such a limit but weren't offered it until that day, according to Hennepin County Board Chairman Mike Opat.
"We'll still lose money on every patient," Opat said Thursday. "But with the cap on patients, we decided we were better off taking the money."
Commissioner Randy Johnson said the plan still casts more risk on the county than he likes, but added: "There are a number of other solutions, but none of them were going to pass the Legislature and get signed by the governor."
What changed this week was that "we realized we could not get the 17 hospitals, not anywhere close," said Pawlenty's human services commissioner, Cal Ludeman, whose department oversees the program and negotiated the caps based on each hospital's historic share of GAMC patients.
The hospitals had argued that the new GAMC left them too exposed to financial risk. Each was to be paid a set amount -- less than half what they received per patient last year -- with no limit on patients.
The state will send letters May 17 to GAMC enrollees, asking them to select a hospital that will provide comprehensive care starting June 1.
Meanwhile, legislators continue to press for expansion of Medicaid, a measure in omnibus financing bills passed by both houses this week.
Staff writer Kevin Duchschere contributed to this report. Warren Wolfe • 612-673-7253