As health care providers anticipate an increasing number of patients unable to pay for care, the state has frozen a fund that reimburses hospitals for charity care.

The Virginia Indigent Health Care Trust Fund was suspended as part of Gov. Tim Kaine's spending cuts announced Thursday in response to revenue shortfalls.

Carilion Clinic receives about $1 million annually from the $7.5 million fund.

Established in July 1989, the fund includes money from the state and money paid by those hospitals that see lower than the median level of charity care provided throughout Virginia.

Those hospitals, which include Lewis-Gale Medical Center, contribute about $3.2 million a year. The state allocation is about $4.3 annually.

Without the state portion, the hospital contributions will not be collected, according to Patrick Finnerty, director of the Department of Medical Assistance Services, which oversees the fund.

The money is typically distributed to those hospitals, such as Carilion, that provide charity care in excess of the median level.

Still, the money hospitals receive is minor compared with the amount of charity care hospitals provide. Carilion, for instance, reported in 2007 it provided more than $42 million in charity care.

Given the current state of the economy, hospital officials throughout the state expect the amount of charity care provided to grow.

"You don't want to diminish the significance of anything that erodes your resources to deliver health care, however, we understand the position the state is in and the position the economy is in and don't think it will impact our operations," said Carilion spokesman Eric Earnhart. "We will be able to absorb it."

A senior vice president with Virginia's hospital advocacy group said the fund amounts to a small bandage for the steadily increasing amount of charity care provided in the state, which he said equates to about $300 million.

"It's a very small program relative to the size" of the need, said Chris Bailey with the Virginia Hospital & Healthcare Association. "That said, it is helpful. It's better than nothing."

Bailey said he is concerned that this cut could be signaling more cuts in the future for health care programs for the poor.