Hospital claims reform causing financial woes

Sean Kelly of WCVB-Boston reports that, despite suing the state on the grounds that financial difficulties caused by Massachusetts health reform could cause it to close within a few years, Boston Medical Center paid its outgoing CEO a $3,466,458 “in recognition of exceptional performance over a period of 15 years.”

This one-time payout, agreed upon in the terms of Ullian’s 2005 contract, came on top of the $1,348,504 in salary and benefits she earns annually. Kelly reports that her annual compensation is “on par with that of other hospital CEOs in the Boston area.” Watch the broadcast here.

In light of the national health care debate, it is interesting to note how the hospital says reform in that state has affected it. Its lawsuit claims that, since reform was enacted, “the way hospitals are paid to provide medical care to the poor and uninsured changed for the worse. Officials say they are now paid only 64 cents for every dollar of care delivered.” The hospital claims it is losing tens of millions of dollars because it treats more subsidized patients than other hospitals.

In July, when BMC’s lawsuit was filed, a spokeswoman for the Executive Office of Health and Human Services acknowledged that “the fiscal downturn has required reductions to BMC … that are proportionate to” the number of low-income patients it treats. But she went on to say that “even with budget reductions, BMC will receive approximately $400 million in direct payments” for fiscal year 2009. The medical center was also due to receive $1.1 billion for BMC HealthNet, the health plan it manages.

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