Stanton : Hospital to Cancel Medi-Cal Contract

Officials at Midwood Community Hospital have announced plans to cancel the hospital’s contract with the state to provide medical services to the poor.

Administrator Robert I. Mawhinney said the hospital will cancel its Medi-Cal contract Sept. 15 because the program is “contributing to an insurmountable deficit.”

Mawhinney faulted the state for not fully reimbursing Medi-Cal-contracted hospitals for the costs of serving the poor.

In 1988, Midwood lost $1 million under the Medi-Cal program, Mawhinney said.

“We no longer can afford to operate at a loss that continues to grow like a cancer. . . . Unfortunately, the poor will suffer because California is unable or unwilling to provide the necessary spending for their care,” he said.

Ron Klusman, a spokesman in the hospital contracts section of the state Department of Health Services, said Friday that the state has never reimbursed hospitals for the total cost of Medi-Cal services because it lacks the funds to do so.

The rate of reimbursement is negotiated between the hospital and the California Medical Assistance Commission, and contracts may be terminated by either party, Klusman said.