An error made in the Senate Appropriations Committee and passed into law earlier this year is keeping most Mississippi hospitals from accessing $103 million intended to help keep their doors open.

The Mississippi Hospital Sustainability Grant program, part of a package of plans championed by Lt. Gov. Delbert Hosemann to stem Mississippi’s health care crisis, was supposed to quickly send millions to hospitals to help them survive the year. One report puts nearly half of rural hospitals in danger of closing because of budget concerns.

But now, months later, that money hasn’t gone out and only a few hospitals can qualify because lawmakers funded the program with federal pandemic money.

The problem, according to health care officials, is that lawmakers designated the funding for the program to come from federal COVID-19 relief funds. Because of federal restrictions about how those funds can be administered, most hospitals do not qualify to receive them. Had lawmakers funded the program with state dollars instead of federal dollars, hospitals likely could draw the funds without issue.

Here’s how the legislative process unfolded, and how lawmakers changed the funding source over time:

• House Bill 271 was authored by Republican Rep. Sam Mims of McComb and originally sought to fund the program with federal American Rescue Plan Act funds.
• House leaders during the committee process amended the bill to instead be funded by state dollars via the Capital Expense Fund, where the Legislature’s excess revenue from prior fiscal years are housed. The House passed that version of the bill on February 16 and sent it to the Senate for consideration.
• In the Senate Appropriations Committee on March 9, before the bill reached the Senate floor, leaders amended the bill to change the funding source to federal funds once more — despite a record state revenue surplus of about $3.6 billion.
• That amended bill featuring the federal funding was later passed by the entire Senate on March 9.
• The House sent the amended bill to a conference committee, where three leaders from both the House and the Senate met to hash out differences. The bill that made it through the conference committee process kept the federal funding source intact, and the total hospital grant program featured in the bill was upped to $103 million. 
• Both chambers of the Legislature passed that final version on March 31, and Gov. Tate Reeves signed the bill into law on April 17.

It’s not exactly clear which senator pushed for the change to the program’s funding from state to federal. While subcommittee meetings are open, closed door meetings, where major legislative proposals are often made, are common in the Legislature. The state budgeting process, in particular, routinely operates outside public view.

Sen. Kevin Blackwell, R-Southaven, presented House Bill 271 as the first piece of legislation the Senate Appropriations Committee discussed on March 9.

Blackwell said in that committee meeting that the bill’s funding would likely need to be increased. Sen. Briggs Hopson, R-Vicksburg, who chairs the powerful committee, then explained that additional funds might have to come from another source outside of the federal COVID-19 funds before the bill passed the committee.

A recording of the March 9 meeting shows that discussion about the bill was brief, and the amendment to the funding’s source was unanimously passed by the committee members. 

Blackwell, Hopson, and Sen. John Polk, a Republican from Hattiesburg and the vice chair of the committee, did not answer calls or return requests for comment. 

Hosemann, who wields great influence over the legislative process as the president of the Senate, did not say when it became clear to him the federal funding was causing problems in the program, but he was at least aware of the issue in May when Mississippi Today reached out to him and published a story about how the federal funding was impacting hospitals’ ability to access the money.

“The intent of the Legislature was to provide $103 million to hospitals and Lt. Gov. Hosemann has committed to ensuring they receive it, even if the program or appropriation source has to be changed,” said Leah Smith, Hosemann’s deputy chief of staff.

Though the error was made in the Senate committee, there were multiple opportunities over several weeks and votes for legislative leaders, members of both the Senate and House, and Gov. Reeves to catch the problem.

In the months that have followed, it’s become clear how much the program — and hospitals — have been impacted by that error.

State Health Officer Dr. Daniel Edney told legislators on Sept. 29 at a Joint Legislative Budget Committee meeting that just two-thirds of Mississippi hospitals have applied so far, and only half of them are eligible for the money. That’s because they’ve already received federal pandemic relief funds.

“You can’t double dip,” Edney explained to Mississippi Today earlier this week.

Edney told Mississippi Today on Oct. 4 that the health department had been “given some possible hope that a workaround we had previously hoped for might be possible after all.” It’s not clear what that workaround is.

“We’re all still working on the problem,” he said. 

Even though the $103 million was much less than hospital leaders said they needed, they agreed any amount would help the state’s hospitals. 

Edney said the health department raised concerns about the funding’s source during the session, but it appeared at the Sept. 29 meeting that lawmakers had previously been unaware of how widespread the accessibility issues were, and that the health department needed legislative direction before doling out the funds.

He made clear at the meeting that the health department, which was awarded $700,000 to disburse the funds, needs instruction from elected officials about what to do with the money — either send out the $103 million to a portion of hospitals now, or wait and fix the program in January.

It’s not clear how long some hospitals can hold on.

At least one hospital has closed this year, and several others have applied for a federal designation that slashes services but increases reimbursements and monthly federal payments. Others, Edney said, have been forced to reduce or cut the services they offer.

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