Nearly a third of Ohio’s hospitals surveyed by an industry group said they have cancelled or delayed construction and capital-improvement projects as they struggle to maintain fiscal stability.

Of those surveyed, 29% said they had postponed capital improvements, 35% plan to lay off additional employees within the next six months, and 42% said they have enacted hiring or salary freezes, according to the survey conducted by the Ohio Hospital Association.

The survey comes as the General Assembly debates Gov. Ted Strickland’s plan to impose a “franchise fee” on hospitals, which would total 1.27% of  their total operating costs in 2010 and 1.3% in 2011. The fee would raise $600 million in the state’s two-year budget, and proceeds would be used to increase the amount of federal matching Medicaid funds.

Hospital officials are strongly opposed to the idea, and have warned it would lead to more layoffs, reduced services and postponed projects. Hospitals serving rural areas would be particularly hit by the new fee, said the OHA.

Ohio’s hospitals have seen a 41% increase in charity care and a 50% increase in bad debt during the last eight months of 2008. Since 2002, total uncompensated care has increased to $1.3 billion from $700 million.

The OHA has 174 members, and 110 participated in the survey.

Subscribe Now

Independent and authoritative analysis and perspective for the bond buying industry.

14-Day Free Trial

No credit card required. Complete access to articles, breaking news and industry data.