According to the Chief Financial Officer for Providence Hospitals in Montana, Kirk Bodlovic, St. Patrick Hospital alone will be absorbing a total of about $13 million in Medicaid expansion costs over the next two years.

“These additional cuts are impactful,” said Bodlovic. “For St. Pat’s alone last year even with Medicaid expansion, we had uncovered costs of providing services to Medicaid recipients of about $7 million a year. In the new reductions in payments we expect that to grow by about $4 million in 2018, and by about another $2 million in 2019.”

Bodlovic said the hospitals have already been attempting to trim costs in anticipation of the reduced funding.

“Over the last several years, we’ve been focused on reducing costs and eliminating waste in order to be more efficient as an organization,” he said. “In order to realign our costs to reduced reimbursements that we know were coming, not just from Medicaid but in general, so we’ve been preparing for the impacts of reduced funding for some time, now.”

As of April, 2018, Bodlovic said there are no plans for any immediate reduction in staffing at the hospitals in Missoula and Polson.

“We don’t have any current plans to lessen our labor costs at this time, but I would say that labor expenses account for more than 40 percent of the expenses at our facilities,” he said. “As time goes on, we’ll evaluate labor costs along with every other line in our budget. As far as services go, we’ll continue to look at all our services because we want to continue to serve all the people of western Montana as best we can, but our cost structure certainly has to align with revenues that we can generate.”

Bodlovic said the numbers of patients with no insurance coverage has been drastically reduced with the expansion of Medicaid.

“What we have seen is folks with no means of insurance, starting back with the Affordable Care Act, we had about nine percent of our business at St. Pat’s went to people with absolutely no insurance, but that number has dropped to just over two percent with Medicaid expansion,” he said. “So we’re serving moiré people and still losing dollars in provided services, but the bigger issue if more people have access to coverage that they didn’t have before.”