GARY | A payment of nearly $80 million due Methodist Hospitals this week would make the hospital "cash rich" for a time, Indiana Family and Social Services Secretary Mitch Roob said.

The question is how the cash-strapped hospital will use the money, said Roob, who called on "leadership to step in and lead the effort."

The Methodist Hospitals' Northlake Campus in Gary is due to receive its Medicaid Disproportionate Share payment later this week, which is meant to compensate hospitals with high percentages of uninsured and low-income patients.

Planned changes in federal and state regulations governing distribution of the funding could make this the last sizable payment, Roob said.

"We plan on providing the largest and likely last payment of that size to Gary Methodist," Roob said. "This is a time of enormous opportunity and enormous risk."

The payment is expected to arrive before Sunday, when a moratorium is due to be lifted on legislation that limits funding of the disproportionate share program, the Hospital Care for the Indigent program and other programs.

"Methodist will be cash rich," Roob said. Hospital and community leaders "need to plan for the future. They need to be hard-headed about the future of that facility."

Hospital officials said the $80 million is a one-time catch up for care provided between 2005 and 2007.

"Methodist management will be recommending to its board that these funds be conserved to support future operation," particularly the hospital's commitment to providing quality health services to those in need, the hospital said in a prepared statement.

Charles Brooks, chairman of the hospital's board of directors, said plans are to discuss the money at a June 2 board meeting.

Until then, "We don't have any plans at this point as to how that money is going to be utilized," Brooks said. "This is money that the hospital has already provided services for."

The hospital has struggled economically in recent years, and in 2006, it lost about $23.6 million.

Hospital turnaround company FTI Cambio Healthcare was hired last year, and the company's Claude Watts was named Methodist interim chief executive officer in August.

A group of community leaders has met with Methodist officials over the past two years to make certain the hospital stays open, said State Sen. Earline Rogers, D-Gary.

"We have been working quite successfully with hospital leadership," Rogers said. "Everyone concerned is trying to make sure the climate is there for growth."

A permanent CEO is expected to be hired by September, when the hospital's contract with FTI Cambio expires.

When that person is in place, Rogers said, "interest shown by the community and by hospital personnel" bode well for the future of Methodist.