The effort to establish a dental facility in Kenai for Medicaid, uninsured and underinsured patients met with opposition Thursday evening at Central Peninsula General Hospital.
The board of directors of CPGH Inc., the nonprofit organization that runs the borough-owned hospital, voted to table a resolution to approve participation in a program in which the hospital would share in the cost of the clinic.
The Kenai Peninsula Borough Assembly is scheduled to vote on a similar resolution Tuesday night, although borough Mayor Dale Bagley likely will recommend the resolution be removed from the agenda.
Borough Attorney Colette Thompson said the state is exploring other funding options and may not need to use the complicated funding formula which raised concerns among hospital board members.
"The state will notify us when the other program works or doesn't work," Thompson said.
The other funding source is not finalized, but it could remove the need for the borough's involvement, thus eliminating the hospital's role, she said.
Called a "disproportionate share hospital payment program," the means to fund the dental clinic is a solution devised by the state Division of Medical Assistance. The dental clinic would be operated by Central Peninsula Health Center Inc., the same nonprofit organization that currently runs Cottonwood Health Center.
Thompson said the hospital's participation is needed because the funding program requires a publicly owned health care facility to act as a conduit for the funding.
Under the provisions of the program, the borough, through the hospital service area, would contribute $794,785 from the hospital's plant expansion replacement fund in an intergovernmental transfer to the Division of Medical Assistance. The state would add $1,099,702 to that amount and pay a total of $1,894,487 to CPGH Inc.
The hospital would then pay $324,702 back to the Division of Medical Assistance for additional statewide Medicaid programs and pay $725,000 to CPGH Inc. for a dental clinic building.
The balance of $794,785 would be retained by the hospital along with a $50,000-administrative fee.
The state would seek reimbursement from the federal Medicaid program of the $1,099,702 it contributed to the project.
A vote of approval is needed from CPGH Inc. in order for the plan to move forward, but board members were not ready to support it without more information.
"To me there are some questions," said board member John Hoyt. "The administrative fees are nominal, but it doesn't mitigate the risk."
The risk is the chance the federal government may not reimburse the state. But CPGH Inc. would offer up the clinic building as collateral should anything go wrong.
"Where I have a problem is that the perception in the community is that CPGH Inc. is going to be supporting this," said board member Steve Hoogland. "The risk is not worth the benefits. I'm not ready to accept this responsibility."
CPGH Inc. board president Diana Zirul pointed out that such a clinic might impact private dentists.
"I've heard that there are concerns from dentists," she said.
Zirul also expressed her own concerns.
"The biggest thing that has come out is that this $725,000 is going to purchase a building," she said. "That's a capital expense.
"There are a number of concerns out there. I think we should look at this further. There is a need, but is this the right way?"
Board member Bill Reeder made a motion to table the resolution until January, pending more investigation, and Susan Wilcox seconded the motion. The board voted unanimously to table the issue.
Board members Ken Meacham and Tom Boedeker were not present at the meeting.
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