PO Box 360
Trenton, NJ 08625-0360

For Release:
March 1, 2013

Mary E. O'Dowd, M.P.H.
Commissioner

For Further Information Contact:
Office of Communications
(609) 984-7160

Governor Christie Continues Commitment to New Jersey Hospitals with Nearly $1 Billion in Funding

Increases Graduate Medical Education Funding to $100 Million

Trenton, NJ - New Jersey Health Commissioner Mary E. O'Dowd today released hospital specific distribution amounts for New Jersey's 71 hospitals that will be distributed as part of Governor Chris Christie's proposed Fiscal Year 2014 Budget. This year's budget includes a $10 million increase in Graduate Medical Education (GME).

"Governor Christie recognizes the tremendous services our hospitals provide to residents by supporting them with nearly $1 billion in funding," said Commissioner O'Dowd. "This funding supports the financial viability of hospitals and supports their ability to serve their communities."

Despite the economic challenges facing the state, Charity Care funding, which is a subsidy for care provided to the uninsured, will continue at $675 million. To ensure transparency and predictability, the payments were based on calendar year 2011 claims data. This allows distribution numbers to be released early - enabling hospitals to better plan. All hospitals with an increase in documented Charity Care realize an increase in payment and all hospitals with a decrease in documented Charity Care will experience a decrease in funding to assure accountability.

In recognition of the essential role New Jersey's teaching hospitals play in health care workforce development, Graduate Medical Education (GME) funding increases $10 million to $100 million. GME payments help compensate teaching hospitals for costs directly related to resident physicians' education, such as resident salaries and benefits, faculty costs and costs associated with administering GME programs.

In this year's budget, the Hospital Relief Subsidy Fund (HRSF) is being replaced with the Delivery System Reform Incentive Payments (DSRIP) at $166.6 million. The funding level remains the same. The DSRIP program, which is part of the Medicaid Comprehensive Waiver, is a new incentive-based funding pool that hospitals may apply for later this spring. The funding formula for DSRIP is still being developed.

"To maximize our share of federal matching funds, we have reformed the way we calculate distributions so that hospitals are reimbursed based on the level and quality of care they provide to patients," added Commissioner O'Dowd. "These formulas maintain the goals of equity, transparency and predictability while minimizing fluctuations in funding."

Graduate Medical Education and Charity Care figures can be found at: http://www.state.nj.us/health/documents/hf_budget2014.pdf