Medicare law to bring millions to N.D.

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As St. Alexius Medical Center CEO Dick Tschider stood before a room full of medical professionals Wednesday talking Medicare reimbursement, he had to pause to fight back tears.

"You don't understand what it's like," Tschider said. "As long as I live, I will never forget this."

Rep. Earl Pomeroy, D-N.D., and Sen. Kent Conrad, D-N.D., gave the group new figures on the amount of money new Medicare legislation will bring to the state and Bismarck community. Over the next 10 years, North Dakota hospitals will see an extra $128 million. Medcenter One Health Systems and St. Alexius will receive $48 million of that money, which is more than the estimated figures released when Congress first passed the legislation at the end of November.

The extra money will help close the gap in Medicare reimbursement between Bismarck hospitals and hospitals in Fargo and the rest of the country. Currently, Medcenter One and St. Alexius are reimbursed at a level that's 18 percent less than Fargo hospitals, while operating at the same level. That resulted in Medcenter One making more than $7 million in cuts and St. Alexius making $3 million this year.

"In a global sense, this means we will not be faced with a prospect of looking to services and staffing in terms of expense reduction," said Gary Miller, St. Alexius chief financial officer. "We will be able to maintain our level of operations and close the gap in salaries and benefits that exist between eastern and western North Dakota."

Of the $48 million that Bismarck hospitals will receive, $20 million is earmarked for bringing Bismarck hospital reimbursements up to the same level as Fargo. That money is for the next three years, and after that, the federal government will have to renew the funding.

If they don't, local hospitals will be right back where they started.

"We would be in a situation where we would be facing some of the situations we are now," Miller said. "At the end of the three-year period if we can show we have maintained or improved our quality and rural access to care, we will have a good case to go forward and maintain the changes on a permanent basis."

Conrad said there is a good chance the money will be renewed at the end of the three years. If it is, Bismarck hospitals would see an additional $40 million in the next 10 years.

"All I can say is what happened to other hospitals that had adjustments like the one we have achieved here," Conrad said. "At the end of their three-year period the funding continued. The odds are quite good that we will have our three-year provisions extended."

With both hospitals being one of the biggest employers in the area, officials expect to see an impact on the economy. Officials from Medcenter and St. Alexius said most of the money will go toward increased salaries and benefits for workers and new equipment.

"There will be an economic ripple effect," Medcenter One CEO Jim Cooper said. "There will be more money coming into the community of Bismarck, and we will spend that in terms of providing needed care, salaries for our staff and supplies. It has a positive economic impact in continuing to work it's way through the local economy."

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