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News Releases

For Immediate Release

Children’s Hospital of Pittsburgh Warns that Medicaid Cuts Will Hurt All Pennsylvania Children

Children’s Hospital of Pittsburgh will lose nearly $7 million in medical assistance funding

For more than 100 years, Children’s Hospital of Pittsburgh has treated every child regardless of ability to pay or health insurance. But severe cuts to Medicaid funding in the 2004 state budget may force the hospital to turn its back on Pennsylvania’s children by discontinuing certain services.

Gov. Ed Rendell proposed, and state legislators adopted, a budget that reduced medical assistance by $250 million for the next fiscal year. If that funding is not restored, Children’s Hospital stands to lose $6.7 million in state medical assistance funding by June 30.

One-third of Children’s patients are enrolled in Medicaid. For every dollar the hospital spends caring for its young patients, Children’s receives only 75 cents in reimbursement. However, these cuts will hurt more than the Medicaid patients.

“There is no room for cuts. We treat all patients equally regardless of their ability to pay. These cuts will force us to take a hard look at the services we provide, and that will affect all patients,” said Ronald L. Violi, president and CEO of Children’s Hospital of Pittsburgh. “If the funding is not restored, it will cause generations of problems for all Pennsylvania’s children - not just those on Medicaid. The cuts would jeopardize Children’s Hospital of Pittsburgh’s ability to provide health care services to all children in the 24 counties we serve.”

Violi added that despite severe budget cuts that will place a financial burden on the hospital, the state still expects the hospital to operate like an efficient business and continue to provide a high level of service.

“At Children’s Hospital, we mend and transplant young hearts, we ease the labored breathing of children with cystic fibrosis and asthma, and we give children with cancer the opportunity to improve their quality of life. It’s not your average business,” Violi said. “The health care and well-being of our children should not be compromised. We see miracles every day at Children’s - and they start with us never turning a child away.”

For Susan and Richard Lucas, Children’s Hospital and medical assistance have changed their lives forever. Their daughter, Madison Lucas, is a 10-month-old baby who has been receiving care at Children’s since the day she was born. Madison was born with a heart defect and has undergone numerous surgeries already.

“If Children’s did not exist or if we were unable to take our daughter there - she would probably not be with us today,” Susan Lucas said. “Children’s saved our daughter’s life and I hate to think of what our family’s future would have been if it wasn’t here.”

Last year, Children’s provided more than $20 million in free care to children from families with no insurance or inadequate coverage. Despite the fund-raising efforts and generous donations of Children’s supporters of the Free Care Fund, the fund brought in $2 million last year. Rising unemployment means more parents will lose health insurance, resulting in a greater dependence on Medicaid. If the trend continues, Children’s Hospital anticipates providing more than $23 million in free care in the next fiscal year.

For Children’s Hospital, a $6.7 million cut represents the following:

  • Specialized nurses, technicians and critical care support staff for the Pediatric Intensive Care Unit for one year.
  • Medications for hospitalized children for nine months.
  • Care and education for 700 children with diabetes for one year.
  • Nursing care for 1,180 patients who require at least a week’s stay.

Not only will it affect the services, the funding loss also will affect the hospital’s ability to retain employees, will force the hospital to train fewer pediatricians and make it impossible to invest in the advancement of medical technology.

With construction of the new Children’s Hospital in Lawrenceville, which is a necessary move from the obsolete space in Oakland, the hospital will already have to turn to the community for support, Violi said, adding that “the state cannot expect us to have the families make up the $6.7 million difference when they are already paying a greater percentage of their health care premiums than ever before.”

In 1997, Children’s started with an operating deficit and an uncertain future. Every aspect of the hospital’s operations was scrutinized which resulted in several years of financial gain, including $5.9 million last year. Every gain has been used to expand clinical and research components, such as opening in December the region’s first Cardiac Intensive Care Unit.

Last month, Congress approved almost $898 million in federal funding to Pennsylvania but the state has not decided how the money should be spent.

“Restoring the $6.7 million to Children’s Hospital of Pittsburgh, one of the country’s top 10 pediatric hospitals, would mean saving the lives of Pennsylvania’s children,” Violi said. “That is money well spent.”

Editor’s Note: Children’s Hospital has created an Advocacy site where e-mails can be sent to legislators urging the restoration of medical assistance funding. Visit Children’s Web site at and click on the “Advocacy” button at the top of the page to send a message. It takes less than three minutes to complete.

Melanie Finnigan, 412-692-5016 or 412-692-6956,
Dean Walters, 412-692-5016 or 412-692-6956,

Last Update
February 20, 2008
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Last Update
February 20, 2008