Greenwood (Miss.) Leflore Hospital and the state Medicaid program have reached a temporary agreement to limit repayment of disputed funds while a court reviews the matter in the wake of a Dec. 18 public hearing.
“The hospital repaid $1.1 million in June and $900,000 in September,” Gary Marchand, interim CEO of Greenwood Leflore Hospital, said in a Dec. 19 statement shared with Becker’s. “It was the demand for $2.5 million in December that threatened the closure of the hospital.”
The Medicaid program informed Greenwood Leflore in June that it had overpaid the hospital $5.5 million in Mississippi Hospital Access Program payments in 2024 and planned to recoup that amount from the $12.1 million in current MHAP payments the hospital was set to receive, which was needed to sustain services offered to Medicaid beneficiaries, according to a Dec. 18 letter to employees from Mr. Marchand that was obtained by Becker’s.
Mr. Marchand said Medicaid agreed to pause repayment for 60 days while Greenwood Leflore proposed alternative repayment plans and evaluated its finances. The hospital shared two proposals that would have pushed full repayment to 2027 and 2028. It cited a new Medicare Rural Community Hospital Demonstration designation that would boost inpatient payments annually by around $1.3 million and support a new swing bed service line that would bring in $4.5 million to $6.5 million per year, with most of the revenue not coming until late 2026.
Mr. Marchand said Medicaid then rejected the hospital’s proposals in September and set a $900,000-per-quarter repayment schedule. Following further discussion, Medicaid notified the hospital Dec. 1 that repayment would not be due that month, then reversed course Dec. 12 and increased December repayment to $2.5 million.
Greenwood Leflore then sought court relief on the repayment and reached an agreement with Medicaid to limit repayments and give security for the overpayment until a final ruling or acceptable repayment plan could be reached.
Mr. Marchand said the $2.5 million December repayment was reduced to $447,000, with future repayments indefinitely delayed until other legal issues are resolved.
“As a result of the Court’s resolution, the hospital will continue its operations,” he said.
Becker’s has reached out to the Mississippi Division of Medicaid and will update this story should more information become available.
