Chicago hospital needs $3M infusion to avoid closure

South Shore Hospital in Chicago needs $3 million in state funding by Aug. 1 to avoid shutting down, according to the Chicago Tribune.

The nonprofit safety-net hospital is losing money due to a Medicaid shortfall, and officials said the appropriated state funding is needed to finance daily operations and catch up on payments to physicians and vendors.

"Our cash flow has been depleted, basically," said Timothy Caveney, president and CEO of South Shore. "We'll have to start shutting down the hospital."

South Shore serves a high rate of Medicaid patients, and the facility received less funding than needed under the redesigned Medicaid distribution program that went into effect in Illinois at the beginning of July.

Although some hospitals saw their supplemental funding increase under the new program, South Shore's allocation remained flat, Mr. Caveney said, according to the Chicago Tribune.

The new assessment program, which taxes hospitals and adds matching federal funds before redistributing the money to hospitals across Illinois, provides more than 50 percent of the state's total hospital Medicaid funding, according to the report.

The state approved $14.5 million in grant funding for three of Chicago's safety-net hospitals for the current fiscal year to help bridge the Medicaid funding gap and appropriated $3 million of that supplemental funding to South Shore. South Shore has not received the additional $3 million, but the Illinois Department of Public Health is working "as quickly as possible through the grant-making process" to secure the funding, a department spokesperson told the Chicago Tribune

Without the supplemental funding, Mr. Caveney said South Shore will likely be forced to make significant cuts and eventually shut down.

"We'll probably have to cut funding for our physicians and that means we won't be able to stay open as a critical access hospital," he said.

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