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Private hospitals join AZ suit against health-care district

10:48 AM MST on Friday, June 13, 2008

PHOENIX (AP) -- Several private hospitals are urging the Maricopa County health-care district to sign off on tens of millions of dollars in federal funds that help hospitals pay for uncompensated care costs.

Arizona sued the Maricopa Integrated Health System last week, after the district refused to certify the federal funding by the June 2 deadline.

The district used the certification as leverage in an attempt to push the state to give it a larger chunk of the funds.

Without the certification, much of the federal funding is endangered, including $55 million supposed to go into the state's general fund.

The private hospitals worry that the district's move could affect the distribution of more than $26 million supposed to go to private facilities throughout the state.

Seventeen hospitals including Phoenix Children's Hospital and Banner Health, Abrazo Health Care and Catholic Healthcare West facilities filed the motion Wednesday to intervene in the lawsuit on the side of the state.

Bill Byron, a spokesman for Banner Health, said the district is jeopardizing everyone's share of the federal funding, known as disproportionate-share funds.

Warren Whitney, vice president of strategic development for the health-care district, said the district's attorneys are reviewing the private hospitals' motion and will respond to it next week.

But Whitney said the district's push to receive more disproportionate-share funds is not intended to take away from money received by other hospitals for their uncompensated care.

Each year, the state receives about $100 million in money from the federal government intended to help compensate hospitals for some of the care they provide to uninsured patients or others who cannot pay.

Under a new agreement with the feds, which was passed into state law last year, district is required to certify its uncompensated care costs in order for the state to draw down about $60 million in federal disproportionate share funding.

The district gets about $4.2 million of that money, with the rest going to the state's general fund.

District officials said that is unfair and said they believe they should receive the entire $60 million. They have been pushing for legislation to increase their share of the money in future years.

The state has contended that the arrangement is consistent with a deal struck when the state created its Medicaid program, relieving counties of much of the burden for indigent health care.

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Information from: The Arizona Republic, http://www.azcentral.com

© 2008 The Associated Press. All rights reserved. This material may not be published, broadcast, rewritten or redistributed. Learn more about our Privacy Policy.

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