A group of 17 New Jersey hospitals — most located in rural communities in South Jersey — will benefit from an additional $36.5 million in federal funding to help them pay physicians and other providers for treating seniors and low-income patients.
All but one are part of a group of 20 that shared $33 million last year through the same supplemental award, designed to help offset high employee costs in the Garden State.
The funding follows a special request from U.S. Sens. Robert Menendez and Cory Booker, both Democrats, and the other members of the state’s bipartisan Congressional delegation, who wrote to federal officials in May urging them to include the Garden State in the funding pool.
“This gives New Jersey hospitals security in knowing that the wage-based Medicare reimbursements will be fair and equitable,” said Menendez, who has argued for decades that the state should be included automatically. “I am once again pleased that CMS is continuing to value the care provided by hospitals in New Jersey.”
A rite of spring
The process has become something of a spring and summer ritual in recent years, ever since the federal Centers for Medicare and Medicaid Services began to reform regulations designed to protect healthcare wages in certain rural states.
Despite the landscape in some regions, New Jersey is one of three states — along with Delaware and Rhode Island — with no areas that are designated as rural under Medicare guidelines. In the past, CMS officials had included the Garden State in the special funding pool to support labor costs in less-populated areas, given the high costs of providing care in the region.
But that changed in 2015, when CMS launched a process to rewrite the rule, known as the “rural floor policy” for healthcare wages. When federal officials suggested New Jersey would no longer be eligible, Menendez, Booker, and their Democratic and Republican colleagues in the U.S. House began to write to CMS each spring, urging them to extend the unofficial policy that allowed Garden State hospitals to tap into the fund.
So far, they’ve been successful. This year’s letter was also backed by direct lobbying from Rep. Tom MacArthur (R- Ocean), who made national headlines when he offered a controversial amendment to the Republican plan to replace Obamacare in the House that enabled the legislation to squeak through passage in early May. Hospital officials and others praised MacArthur for his personal involvement.
‘Huge win for NJ’
“The extension of the imputed rural floor is a huge win for New Jersey,” MacArthur said, noting that it “will bring millions of dollars to our state and will help our hospitals continue to provide quality care for the most vulnerable New Jerseyans.”
“This was a priority for New Jersey and a priority for me, which is why I fought hard for this over the last few months,” he added, thanking the administration for granting the request.
The funding was welcome news to the New Jersey Hospital Association, which represents the state’s 71 acute-care facilities. “The floor extension ensures that New Jersey hospitals and health systems will receive federal payments that are fair and equitable with other states that have the protection of a rural floor,” explained Kerry McKean Kelley, vice president for communications.
These hospitals will receive the following allotments as of this year, according to the hospital association:
(Salem County) – $224,000
+ St. Luke’s Warren Hospital (Phillipsburg, Warren County) – $3.5 million