Butler Memorial Hospital. Butler Eagle file photo
Butler Memorial Hospital will receive over $936,000 in reimbursements from tobacco settlement funds, according to an audit released Thursday by the state.
Pennsylvania Auditor General Timothy L. DeFoor released audits for 28 health care facilities across 18 counties, including the former Butler Health System, which merged with Excela Health this January to create the Independence Health System.
As part of the Master Settlement Agreement between 46 U.S. states and the four major tobacco manufacturers in 1998, Pennsylvania received $11 billion to be portioned out between 2000 and 2025.
In the summer of 2001, the Tobacco Settlement Act authorized Pennsylvania’s Department of Human Services to allocate funds from the agreement to compensate state hospitals serving low-income or uninsured patients.
Hospitals that qualify to receive settlement money can receive payment through either the “uncompensated care” method or the “extraordinary expense” method, with Butler Memorial Hospital opting for the latter. A hospital qualifies for reimbursement on an extraordinary expense claim when the cost of that claim exceeds twice the average costs of all claims for that facility.
The settlement amount announced Thursday is for claims filed during the fiscal year ending June 30, 2022, to be paid in the 2024 Tobacco Settlement Payment Year.
For the most recent fiscal year, Butler Memorial Hospital reported 11 extraordinary expense claims. The state determined that nine met the criteria to qualify for reimbursement, with these claims adding up to more than $936,000.
In BMH’s previous tobacco settlement audit, the hospital reported 13 extraordinary expense claims for the fiscal year ending June 30, 2021. Eleven of these were accepted, which added up to more than $1.6 million.
“Our audits ensure hospitals have documentation to support the receipt of tobacco settlement funds before receiving reimbursement for uncompensated care,” DeFoor said.
The Butler Eagle reached out to officials at Butler Memorial Hospital, who declined to comment.
