LePage to announce plan to repay $186M owed to hospitals

Posted Jan. 14, 2013, at 6:18 p.m.
Last modified Jan. 14, 2013, at 6:47 p.m.
Gov. Paul LePage
Gov. Paul LePage

AUGUSTA, Maine — Gov. Paul LePage will unveil a plan Tuesday afternoon to pay $186 million the state owes in back payments to hospitals.

The governor will release his proposal during an event at the University of New England’s dental school, which is under construction on Stevens Avenue in Portland.

Maine’s 39 hospitals are owed $484 million in total, according to a Monday release from the governor’s office. State payment of $186 million would trigger $298 million in federal matching funds, the release states.

The unpaid bills represent MaineCare payments that date as far back as 2009, two years before LePage took office.

“Maine people work hard to pay their bills, and their government must as well,” LePage said in a prepared statement announcing Tuesday’s event.

“We cannot have a prosperous economy when we owe hundreds of millions of dollars to the hospitals that care for and employ Maine people. It’s imperative that we pay these bills now.”

LePage did not address the hospital debt in the supplemental budget he proposed Friday to close a roughly $112 million shortfall for the fiscal year that ends June 30. Nor did his proposed spending plan for the biennium that begins July 1, which Finance Commissioner Sawin Millett presented Friday, include provisions to pay the hospital debt.

Dating back to his 2010 gubernatorial campaign, LePage has made repaying the debt a priority and frequent topic during public appearances. In August 2012, LePage reportedly considered calling a special session of the Legislature to deal with the hospital debt. That plan did not come to fruition.

“This is the governor’s jobs bill,” Adrienne Bennett, LePage’s press secretary, said Monday. “The governor is adamant about paying back the debt. Great-paying careers and projects at Maine hospitals have been put on hold since 2009 because the state hasn’t paid its debt.”

Bennett declined to offer details on the proposal or whether it would include any form of borrowing to come up with the state’s share of the money owed to hospitals.

“The governor has said in the past that he will sell bonds when it is fiscally prudent to do so,” she said. “Paying off $500 million to Maine hospitals is a great start to paying off Maine’s debt and getting us to a place where the state can absorb more debt. Bonds have been an issue that has gained much attention in the past. This is part of a plan that governor sees functioning in conjunction with selling those bonds.”

Citing the state’s debt load, LePage has refused to sign bonds approved by voters in 2011. The governor previously said he wants to decrease the state’s overall indebtedness before authorizing sale of the bonds, most likely in 2014.

Representatives of the Maine Hospital Association will attend Tuesday’s event, according to the governor’s office.

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