As hearings begin on GAMC pact, providers and advocates for the poor analyze its implications

Hennepin County Board Chairman Mike Opat is trying to keep track of all the acronyms in a bipartisan compromise to save health care for impoverished adults without children. To name a few: CCO, DSH and UCP.

“It becomes a formula orgy,” Opat said Wednesday afternoon on his way to a meeting with state Sen. Linda Berglin, one of the DFL negotiators. “It’s this acronym at this percentage and that acronym at a different percentage. It’s intergovernmental transfer here and disproportionate share hospital [DSH] payments there. I can’t speak that intelligently to any of those except to say: You need a translator.”

Like other stakeholders, Opat also was waiting “on the math” in a new bill [PDF] filed at 6:45 p.m. Wednesday. This morning, the Senate Health and Human Services Budget Division started taking public testimony at 8:30. And the House Health Care and Human Services Finance Division plans a 1 p.m. hearing today on the bill.

Opat’s key interest is what’s in store for Hennepin County Medical Center in Minneapolis, the state’s largest safety-net hospital serving the biggest proportion of patients on General Assistance Medical Care, the program in question. He is quite familiar with their acronyms, however: HCMC and GAMC.

“The big question is how much of a cut do we take,” Opat said. “Sometimes it’s phrased as some rather small percentage, which means there’s a lot of money in either services to be cut, or an increased level of subsidy that has to happen. It’s really waiting on the math at this point.”

Commissioner Mike Opat
Commissioner Mike Opat

Meanwhile, there’s a sense of relief among advocates for the homeless who depend on GAMC for health care. “For people experiencing homelessness this was a win,” said Monica Nilsson, director of street outreach for St. Stephen’s Human Services in Minneapolis.

Warning: More acronyms ahead.

Outlines of a compromise
Last Friday, legislators and Gov. Tim Pawlenty announced that they had reached a compromise on reforms and reduced funding for GAMC, a 34-year-old program financed by the general fund. The $378 million, two-year solution extends GAMC until the end of May, establishes “coordinated care organizations” (CCOs) through safety-net hospitals like HCMC and Regions Hospital in St. Paul and county agencies, and sets up an uncompensated care pool (UCP) for other hospitals serving GAMC patients. Funding is roughly half its former size.
“This agreement includes meaningful health care reform and important cost savings,” Pawlenty said in Friday’s press release. “I would like to thank Senator Berglin, Representatives [Erin] Murphy, [Tom] Huntley and [Matt] Dean for their hard work on this issue. This is a step forward in difficult times.”

The announcement capped a tense 10 months since Pawlenty, a Republican, used his line-item veto and unallotment to kill $396 million in 2010-11 funding for GAMC. The cuts ignited a firestorm not only in the DFL caucus, homeless shelters and social-justice circles but also in the highest echelons of the medical community.
Nearly 30,000 current GAMC recipients stood to lose their benefits on April 1 and were to be auto-enrolled in Transitional MinnesotaCare, which would have covered them for six months before they would be required to reapply. In the process, 20,000 other low-income working adults without children would have been kicked off MinnesotaCare to make room for poorer people. Most GAMC recipients’ annual incomes are less than $2,800.

At times, the road to the latest agreement was nearly as bumpy as this winter’s ice ruts on University Avenue leading to the Capitol.

“My biggest disappointment is that it had to get to this level of duress or this level of panic before there could be an agreement.” Opat said, adding that he was mostly disappointed in the administration. “I personally tried to engage them in my role as being a leader in the group that provides more GAMC than anyone else in the state as to what would be acceptable and we just never seemed to be able to get an answer as to be what would be acceptable.”
After months of stakeholder meetings and legislative hearings and attempts to engage the administration, lawmakers in mid-February passed by comfortable margins a 16-month solution to restore the program and implement reforms that they thought would pass muster. Then they hit some more ice ruts.

In mid-February, a veto
On Feb. 18, Pawlenty vetoed the bill from Washington, D.C. In his veto message [PDF], he said the bill did not represent “meaningful reform” and did not “address fundamental cost issues.” He then invited legislators to meet with him and his administration to negotiate a solution.

Although the DFL-dominated Senate promptly overrode the veto, the DFL majority in the House was unable to persuade enough Republicans to vote against their governor.

Over the course of several days, Republicans and DFLers debated what they could live with and without. Bottom line at the end of the talks: “For them (GOP) it was the money” and some of the cost-saving reforms, Berglin said. For the DFL, “we wanted a commitment that there won’t be any more unallotments (in the GAMC appropriation) for the rest of the biennium.”

State Rep. Jim Abeler, R-Anoka, said he thinks the breakthrough came with the adoption of CCOs as the health-care model, something HCMC had proposed early on. “It finally all gelled,” said Abeler, vice chair of the House Health Care and Human Services Finance Division. “It’s not so much when the Jell-O became Jell-O. Was it Jell-O when you bought the Jell-O, when you boiled the water and mixed in the Jell-O, or when you put the Jell-O in the fridge? At every point, it’s Jell-O.”

For Berglin, the high and low points in the 10-month process happened within a span of 48 hours.

Sen. Linda Berglin
Sen. Linda Berglin

“The low point was the veto of the first bill we had this year because it was such a strong vote in the House (125-9 with 38 Republicans voting yes and 9, no), and we did not anticipate a veto,” said Berglin, chair of the Senate Health and Human Services Budget Division. “The high point? I think it was getting such a strong vote in the House.”

Protecting prescription drug coverage was a key concern for DFLers in the negotiated compromise, she said. “I think for a population that’s very sick, and they have multiple chronic conditions and at least 70 percent have mental illness, it’s very important to not put barriers in the way of people getting their prescriptions,” said the lawmaker from Minneapolis.

Advocates for the poor seem to be breathing easier since the March 5 announcement.

Waiting for passage
“I hate to call it a win when the bill hasn’t passed, but what’s proposed is that people who are on GAMC will not lose their benefits, people will still be able to access GAMC and 20,000 other people will not lose MinnesotaCare,” said Nilsson of St. Stephen’s. Still, she’s waiting for further analysis of the benefits set for GAMC recipients.

The coordinated care organizations are expected to offer a more “holistic approach” to caring for the poor, said Nilsson, who frequently testified at hearings along with her clients. She’d like to see a federally funded model called Health Care for the Homeless set up at the hospitals, even though these clinics usually are set up in shelters or drop-in centers.

“One of the reasons my [homeless] population accesses the hospital emergency room instead of a neighborhood clinic is because they know when the hospital is open — it’s always open,” she said. “They don’t need an appointment. We’re asking people who don’t own a watch, don’t have a day-planner and don’t have a phone to schedule an appointment, remember the appointment date and get there on time.”

So, what’s to like about the compromise?

“The first thing to like is there is $71 million available for a group of hospitals including ours to treat this population, especially when those dollars weren’t available to us under the veto,” said Geoff Bartsh, director of government relations for HealthPartners and Regions Hospital in St. Paul.

What’s not to like?

“If you’re comparing it to the world before the veto, what’s not to like is it’s less money,” Bartsh said. “If you’re comparing it to what the world would have looked like after the veto, it’s more money. You have to look at it both ways. There certainly will be some challenges, and hospitals will be asked to do a lot in terms of care coordination and care management. That’s where the language in the bill becomes somewhat important to understand what the expectations are.”

Financial implications for HCMC
HCMC spokesman Tom Hayes said the hospital is still trying to figure out all the financial implications of the proposal. “From what we have seen, the funding reductions appear to be significant and will continue to present a challenge for HCMC going forward, but given the deficit facing the state this looks to be the most viable solution out there,” he said.

Today, lawmakers will begin to hear from the public about the bill. They hope the legislation will be signed by the governor by April 1.
“I won’t feel relieved until it is done,” Berglin said. “I sort of feel like anything that can go wrong, will go wrong on this particular legislation. I think it’s been really hard for people to come to terms with the reality of what we’re left with — the first appropriation (2009) being vetoed and then the second bill being vetoed and now a bill that’s a little less than half of the first bill. I think it’s hard for people. It’s hard even for me.”

And now it’s time to throw one more acronym into the mix: ACO, which stands for accountable care organization, a popular concept in federal reform. Some use it interchangeably with CCO.

“I resist the notion that it is a specific list of things that make up a CCO or an ACO at this point,” Opat said. “I look at it as the freedom to fashion a new system, the challenge to do so, and I think we are uniquely situated to do that. I’m actually kind of excited about the chance to do that.”

Now if we can just keep everything straight in the new GAMC world of CCO, DSH, UCP and HCMC …

Casey Selix, a news editor and staff writer for MinnPost[dot]com, can be reached at cselix[at] Follow her on Twitter.

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Comments (7)

  1. Submitted by Greg Kapphahn on 03/11/2010 - 10:40 am.

    Thus do we enact another invisible back door tax on all those who work at clinics and hospitals and all who have health care, who will pay more for their own health care and more in insurance premiums because those institutions which are, rightfully and by law, required to treat the poor and indigent regardless of ability to pay, will have to raise rates in order to meet the legitimate costs of running their institutions.

    Meanwhile, those very needy and unfortunate individuals at the top of the income scale (such as Bill Cooper, head of TCF whose recently-reported 2009 income was $3,684,152) continue to be protected under Governor Pawlenty’s “no new taxes” pledge from having their taxes restored to the levels they were at prior to the pre-Moe/Swiggum/Ventura tax compromise.

    That tax-cutting compromise, was made back when Minnesota was still the leader of the upper midwest in quality of life, income, employment, and education, to improve what the Chamber of Commerce loves to refer to as our state’s (imaginary: “it’s whatever we say it is”) “business climate.”

    After this supposed improvement in the “business climate” was enacted, Minnesota has, by EVERY objective measure, gone steadily downhill for the citizens who live here.

    Having believed the promises that we could have something (a wonderful state) for nothing (without paying taxes) we’re finally discovering the truth: Those who promised us tax cuts gave themselves and their friends (those who were already fabulously wealthy) thousands of dollars in cuts for every nickel they gave us. Consequently our entire state population (except for those at the very top) is suffering. We’re increasingly getting nothing because we wanted to pay nothing.

  2. Submitted by Bernice Vetsch on 03/11/2010 - 11:51 am.

    Pawlenty reminds of the George Bush’s Medicare head, who earned his appointment in part because, while governor of Utah, he expanded Medicaid to cover many more people while saving tons of money.

    Wow, you say. How? you ask. He did two things, the first being to reduce the number of conditions and illnesses covered.

    The second was to survey all primary care and specialty doctors and all hospitals and clinics to see which would provide free care to the poor. He developed quite a list, but all the names were confidential lest people got too many phone calls for help.

    What folks needed to do was to call, for instance, every hospital in Utah to see how many offered free stays for surgery. Then, they had to call every doctor until they found a surgeon who was on the staff of that hospital who had also agreed to provide his/her services for free. And then an anesthetist. This process could, and did, take months.

    Actually, I must say that Utah’s governor was even worse than Pawlenty.

  3. Submitted by Sheila Ehrich on 03/11/2010 - 01:55 pm.


    If this bill passes and the governor signs it, where does that leave the lawsuits that are working their way through the courts? Will we be able to get a definitive answer on whether the original veto was legal or if it was over-reaching and Pawlenty won’t be able to use it to balance the budget HIS way, this time around?


  4. Submitted by Casey Selix on 03/11/2010 - 02:34 pm.

    In response to Sheila Ehrich’s question about the unallotment lawsuit, my understanding is a hearing is still scheduled March 15 before the state Supreme Court on the case involving the dietary program. Last week, a Ramsey County district judge turned down a separate request for a temporary restraining order to halt the unallotment of $15 million for GAMC.

    Casey Selix

  5. Submitted by William Pappas on 03/11/2010 - 08:20 pm.

    It seems to me the innovative cost saving approach is to simply give less money to HCMC and make them continue to do the same work. They’ll cut other areas and lay some people off. Every department in that hospital has suffered deep cuts in the name of Matt Dean efficiency. I don’t see this as innovative or efficient.

  6. Submitted by Jeremy Engdahl-Johnson on 03/12/2010 - 10:45 am.

    Many seem to agree on the need to find a better approach than fee-for-service reimbursement. If accountable care organizations can adopt the risk-management know-how of health plans and integrate patient care using technology and best clinical practice, they may be part of the solution. See

  7. Submitted by Rebecca Hoover on 03/14/2010 - 11:00 pm.

    I expect the Minnesota Republicans to be selfish and cruel so nothing they do disappoints me. I am still keenly disappointed by the Democrats, however.

    When times are tight, the Democrats should be looking at cutting down on lavish and frivolous spending and beefing up programs such as GAMC that meet basic needs. Instead of doing this, the Democrats keep right on spending money on the arts (e.g., at the ritzy ditzy Perpich Center for Arts Education) and on bloated layers of fat, fat management in state government. A glance at the Department of Heatlh’s organizational chart (on-line) shows a slew of “assistant to” type and assistant directors. These are the first positions that should be nipped off.

    The Democrats in Minnesota government are increasingly known among the voters as the party that is way too fond of fat. I think Minnesotans love sharing when needed but do thoroughly resent being taken for a ride. As it is, the Democrats are too fond of taking folks for a ride and not fond enough of protecting those most in need.

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