Facebook
Fark
Digg
Reddit
Stumble
Monday, April 19, 2010 | 2 a.m.
DARK DAYS AHEAD?
UMC officials hope insurance reform will help lower the hospital’s unpaid bills because more patients will have insurance. The problem is that in 2014, Clark County wil begin losing millions of dollars in federal Medicaid payments, which help offset UMC’s cost of caring for illegal immigrants. And many paitients without insurance will still seek care at UMC.Reader poll
Kathy Silver
Sun Archives
- State board OKs emergency funds in planning for health reform (4-13-10)
- Gibbons sets up ‘Constitution Defense Fund’ to fight health reform (4-8-10)
- AG: Gibbons overstepped with plan to sue over health reform (4-6-10)
- Report: Gibbons will join lawsuit over health care reform (4-2-10)
- AG won’t file health reform suit; Gibbons vows to stop ‘intrusion’ (3-30-10)
- Gibbons wants AG’s answer on health bill suit by next week (3-25-10)
- AG says governor can’t force lawsuit over health care reform (3-24-10)
- Dean Heller joins Gibbons in urging AG to sue over health reform (3-23-10)
- Obama signs historic $938 billion health overhaul (3-23-10)
Sun Coverage
Beyond the Sun
University Medical Center and other public hospitals that serve the uninsured could wind up financially pummeled by the new national health insurance law.
Come 2014, when the law takes full effect, Clark County will begin losing millions of dollars in federal matching funds officially known as Medicaid disproportionate share payments. Those payments help UMC defray the cost of providing care to indigent citizens or undocumented residents who aren’t insured.
Lawmakers in Washington told public hospitals the federal government needs to divert the payments to finance other provisions of the insurance reform legislation, including expansion of eligibility for Medicaid, UMC CEO Kathy Silver says.
The hospital will receive $66 million in Medicaid payments this year. That amount includes $43 million in federal money and $40 million in matching funding from the county. Of that $83 million, $17 million is given to the state to distribute to other hospitals. What frightens Silver is the loss of tens of millions of dollars and possibly the entire amount after the insurance reform law takes full effect.
The county would still give UMC money for operational expenses. But Silver fears that by taking away the federal matching dollars, the county would have no incentive to contribute the additional funding that goes into the Medicaid payments.
“Right now, we’re planning for the worst,” Silver says. “A lot of public hospitals are in the same boat, particularly those in urban areas that have been hardest hit by the recession.”
The National Association of Public Hospitals and Health Systems in Washington, of which UMC is a member, said the financial hit to hospitals might not be quite as bad as Silver thinks. The association’s senior vice president, Lynne Fagnani, says public hospitals will be able to retain no less than 60 percent of their federal Medicaid payments by 2024. But that would mean UMC would still lose more than $17 million a year in federal funds in today’s dollars, according to that calculation.
“The association supported the health reform legislation because we felt it was important for people to have coverage,” Fagnani says. “But we are cautiously concerned about whether the disproportionate share of dollars will still be needed.”
UMC spokesman Rick Plummer counters that his hospital believes it will lose a lot more in federal funding than the association projects.
“The cuts may hit UMC harder because of the high number of Medicaid patients UMC treats,” he says.
UMC has reason to be more concerned than other public hospitals. It is projected to run as much as $74 million in the red this year, so it can ill afford to take another severe financial hit.
The hospital collects about $350 million a year but is stuck with $200 million a year in unpaid patient bills, of which about $40 million can be attributed to illegal immigrants and others who can’t — or won’t — provide documentation proving they are in the U.S. legally. The Medicaid payments make up for some of the unpaid bills.
UMC officials are crossing their fingers that other aspects of the insurance reform will help lower the hospital’s unpaid bills to roughly $130 million a year by 2014 because more patients will have insurance. That’s $70 million better than now, which could more than make up the difference of losing the Medicaid payments.
The fear, however, is Nevadans who get new or better health insurance choose to go to private hospitals, Silver says. If that happens, the percentage of UMC’s patients who are undocumented or uninsured would increase while its percentage of insured patients would decline. That’s a recipe for disaster.
The new law mandates that all Americans purchase health insurance. The penalty for noncompliance starts in 2014 at $95 a year or 1 percent of an individual’s taxable income, whichever is greater, and increases in 2016 to $695 a year or 2.5 percent of taxable income.
Because the fine is so low initially, many young, healthy people will likely decide to pay that rather than spend potentially hundreds of dollars a month to have insurance, Silver says. An aide to Senate Majority Leader Harry Reid estimates that 5 percent of Nevadans would opt to disregard the law and take their chances at getting caught.
Where will those uninsured young people go for medical treatment? UMC, Silver says.
“The conventional wisdom in Washington is that we’re going to have all these newly insured individuals, ‘So hospitals, what’s the problem?’ ” Silver says. “The problem is: What about all the undocumented people and young people? What if all the people who get insurance seek care in private hospitals? It might make our situation a lot worse.”
Fagnani’s take: “Once 2014 occurs, we’ll see how that plays out. If young people without insurance are disproportionately served in public hospitals, we would want protection for that.”
With these dark financial clouds in the long-term forecast, UMC is banking on the notion that it could evolve into a destination hospital with a broad range of physician residency programs, coupled with world-class medical research that would bring more specialties to Southern Nevada. The draw of having top-notch cardiology, neurology and anesthesiology departments, to name a few, has the potential to lure many more paying customers to UMC. That, in turn, would allow the hospital to continue to treat indigent patients without taking a severe financial hit.
But Silver said that even in the best-case scenario, it would take at least eight to 10 years for UMC to approach this goal, and that is if the effort is supported by substantial philanthropy and grants. Until that happens, UMC is in for some more “rough years,” Silver says.
The Clark County Commission, meeting as UMC’s board of trustees Wednesday, is scheduled to consider opening the bidding process to have outside contractors study options for UMC and the viability of the hospital establishing a closer relationship with Nevada’s higher education system.
The board is also expected to discuss the possibility of having an independent panel of medical and business experts take over operation of UMC from the county commission. Silver says she will make recommendations on what she believes the qualifications of those members should be.
Las Vegas businessman and former university Chancellor Jim Rogers, who has been put in charge of coordinating plans for UMC’s future, says the potential negative impact of the insurance reform law is something UMC will have to adjust to.
“But we have so many other problems at the hospital to look into before we look into that,” he said.
Only Karl Marx could appreciate Obamacare....
Reids have double team UMC and they will crush it.
Reid Jr with his incompetence at the county level and Reid daddy in DC.
This is just the beginning. Wait till all the private doctors decide to retire because it's just not profitable to do business anymore.
Those of you who voted for Obama, hope you don't complain when you can't find quality care anymore...
you will be able to find quality care...but you will have to travel to places like Nogales, Tijuana, Mexicalli, Juarez or other Mexican border towns.
I thought that Obamacare was to save money??????
Of course now all the ultra conservatives come out in defense of UMC. I thought you guys wanted it to shut down because of all the free health care for 'illegals?'
Fact of the matter is that UMC wouldn't be profitable with its current structure whether now or a hundred years from now, before or after health care reform.
@Dhvincent1 Your conspiracy theory question isn't even lame. It would make a first-grader blush.
@aBadReid You obviously don't know about medical care (I work in medical care). Private practices have been giving way to HMOs and PPOs. The day of private practices is quickly becoming a thing of the past- much like house calls. That was way before Obama passed reform.
The fact of the matter is that medical insurance plans have divided the country into large swaths of monopolies driving costs up. Look at a map. Here in Las Vegas the biggest health insurance company owns nearly 80 percent of us and our care. You think that's fair?? You think that's a free market??
Even the most staunch Republican would recognize reform was needed. But all I see here is corny and recycled FOX News talking points. Time to 'reload' gentlemen.
We all want the best medical care if we get sick. Now we the people of the United States have to figure out how to get it while eliminating the bloat in the health care industry.
Blaming each others politics will not change the fact that health care costs are soaring out of control relative to other sectors of our economy.
Many contributors to online posts are quick to attack the teachers unions and other public sector workers over their salaries and pension plans, but these same problems exist in our hospitals, insurers and health product suppliers.
The fact of the matter is, that any sector of the economy that hasn't been battered down by foreign competition seems bloated only because they still reflect our former standards of living, and allow undisciplined business plans.
These anomalies will continue to rile our system until we can somehow re-balance our economy by gaining the national will to demand fair (not phony 'free') trade, demand our companies stop outsourcing our jobs, control the flow of illegal immigration, tax those immigrants that cannot be expatriated, and on an individual level, BUY AMERICAN CARS (a real instant stimulus) and other domestic products.
The new health care legislation is weak and not what I wanted to see enacted. It is a hacked up product born from the vicious political split in D.C. But at least it is a SOMETHING that will begin a process that will bring some sanity to the cost of our health care.
If we end the political theatrics, and work together, it is possible to bring down relative costs AND maintain our current levels of performance in most of our service and public sector endeavors.
Eliminate the middle man (Insurance Companies) and move to single payer.
Public option may have been the right approach. Single payer is more radical, destroying an entire industry before the govt can prove they are up to the job.
If you allow private competition, each side is kept honest and the best at controlling costs will be the winner. To be fair, govt would have to include all of their administrative costs in their pricing.
If this were to happen, you would probably see the health insurers consolidate into a handful of lean and mean companies. It has already happened, Blue Cross administers Medicare for the State of Florida - so I guess the feds thought BCBS saved them money.
Sounds like a win-win for the avg citizen.
@Newsy97 I like your posts. Don't necessarily agree with all of it in substance, but I appreciate the tone. We can agree to disagree, but often we have posters here (both sides, but mainly on the right) who are strident in their comments and really aren't looking to find solutions, but villify the other side.
I want to correct my comment about health insurance company monopolies- more than 50 to 75 percent of the Nevada market is controlled by two companies according to the American Medical Association (not 80 percent by one company as I originally wrote).
The idea is still relevant however- the AMA provides a national map and it points to the fact that one or two companies throughout states control entire markets.
That isn't free markets or freedom, for those who always rail that we're losing choice.
I am a Liberal! Hell..I am a super Liberal! But this public health care plan SUX!!! Anyone with common sense can see that! The numbers that Obama is putting out just don't add up! Sad. I beleive our president screwed this up royally!!!
Good God. One single hospital in one City loses about $40,000,000.00 (that's right, forty million dollars) PER YEAR because of illegal immigrants.
That is staggering.
Why won't the federal government clean up illigal immigration?
Axiom said: "Of course now all the ultra conservatives come out in defense of UMC. I thought you guys wanted it to shut down because of all the free health care for 'illegals?'"
Thanks for giving me a morning laugh. Totally agree with you.
Ultra conservatives, ever since President Obama took office, have been like seagulls...eat, sleep, crap on the sidewalk and squawk really, really loud.
It's important to keep them in this seagull mode too. They lost power because they blew it.
If you read closely, this is all speculation (or some surprising fearmongering coming from the LV Sun). The hospital will likey save money in other areas to offset loss of those funds and/or it is afraid it will lose other revenues to (better) private hospitals once more people become insured. That sounds like competition, that thing Republicans supposedly value. The hospital adapts or closes down. The article finishes with efforts to plan for the future.
Not one conservative has said healthcare reform was not needed. Opening competition across state lines and doing away with million dollar lawsuits would have been an easy, quick and efficient start.
There is more as well. Allowing for more clinics to be opened akin to what Walgreens does now. I can see someone for minor injuries and illnesses that need attention for about 50 bucks.
The scheme of affordable healthcare is a farce. Most people going to the dr are for routine things that do NOT cost much at all.
The government takeover hurts everyone. All of us will suffer over the few that will be served.
Change is here and all hope is gone.
The main point is when given a choice most people would prefer to be treated in a private hospital as opposed to a public one.
Sadly all hospitals will likely become public ones. I'm thinking all hospitals will eventually be running like UMC...poorly!
They can't even make the DMV efficient, how do they expect to ever get the healthcare industry efficient?
Repubicans any suggestions except no ? Tort reform or insurance across state lines is no solution. Neither is cutting taxes or deregulation. Fifty years after having several wealthy white men golfing on the moon we still don't have universal health care . I think we had deficits back then too ! History will judge us more harshly than the Romans; perverted materialistic goons.
Pretty cruel perverted materialistic goons too!
@MR906...I don't think Marxism means what you think it means...Marx said every person should contribute to society to the best of their ability and consume from society in proportion only to their need. I wonder why some people seem to omit the "contribute" portion and focus on the "consume"...makes it easier to demonize folks as parasites I guess.
@FromBellevilleCanada...why no outrage at the $160 million (4/5 or 80% of the total) in unpaid patient bills from legal 'mericans? Also, the $40 million you're so shocked about includes illegal immigrants AND "others who can't -- or won't -- provide documentation"...so it seems actual illegal immigrants only account for a portion of that amount...wonder who the other folks might be?
Also, the tobacco money should have gone to prop up indigent care and uninsured at UMC etc. But Gwinn wanted his name on something.
If you want competent medical care in Nevada, DO NOT vote for Rory Reid for Governor.
If he and his minions cannot oversea ONE SINGLE hospital, how can they manage a state?
Vote for a Reid-FREE Nevada.
Fred Conquest
Democratic Candidate for Governor
www.fredconquest.com
Universal healthcare does not WORK! - You know who want universal healthcare?
Democrats who want the power to control society and individuals who vote for them because they do not want to take any responsibility for themselves.
There are affordable insurance plans already and can be increased with LESS government interference - not government control
If you believe in freedom and liberty - you cannot honestly believe that government control is a good idea.
How do you think all of this is going to be paid for? With less jobs and more needy, less tax receipts and higher taxes and costs, does this sound like a good plan? Would you run your home like this?
If you have any proof at all or any good arguments that make any kind of sense, I'm open minded enough to listen. Are you?
Blue Cross already stated they will have to raise premiums to pay for the government changes, this UMC is hurting, doctors are hurting and idiots think that FREE HEALTHCARE is somehow magically free or can be paid for by the few that make over 250k.
How many of those people do you think there are? How much should they - alone - pay for?
My wife and I didn't make jack last year - cuz I can't find a freakin job!!! Because there aren't any!
I wish I could be a liberal so I could just sit around and live in my imagination of government bliss.
Unfortunately, I have to live in REALITY and suffer through this garbage and HOPE that we can survive the Obama CHANGE!!!
Its easy to run $74 million in the red every year when you allow the type medicine to be "practiced" at UMC. There are daily events that would NEVER take place in any other hospital in the valley. Got a headache? "Oh maam, we need a CT scan AND a lumbar puncture". Huh? Where is the clinical indication for that? Fever, no? Neck pain/stiffness, no? Trauma, no? Oh wait, a resident needs 3 more lumbar punctures so he can graduate, ahhh I see. Excuse me sir, you say you have a dry hacky cough for the past 3 weeks. Um, ok I to put an IV in you for a CT Angio, we need to make sure you have no pulmonary embolism? Huh? Where is the clinical indication for that? Short of breath, no? Um ok, rapid heart rate, low oxygenation, no? Um ok, previous history of blood clots, no. Ok, well we need to do it anyways, regardless of the $6000 charge for no real reason. But hey, its all in the name of "education", regardless of cost or medical necessity. Its a great ER with a fantastic staff, but you are going to get a million dollar workup whenever you walk through the door
Hmmm, guess I know where I'm not going if I get a headache or a hacking cough. I'll just go to the grocery store and get me some aspirin and some cough syrup. ;-D
@Gems Sorry to hear about your work situation. However, I resent your remarks that as a liberal I just want to sit around and do nothing. That's bull. There are PLENTY of deadbeat conservatives. I know because I've lived in many places throughout the US and I know first-hand how many, regardless of race or political persuasion milk the system. Not only that, but many of these conservatives who happen to have money basically get all kinds of 'corporate welfare' and government subsidies for their industries.
You can ask about health care law but your presumption that it will now all be controlled by government is already not factual. Using Blue Cross as an example when they were looking to raise rates up to 39 percent in California (before health care law) is probably ill advised.
I would respectfully suggest that if you really are 'open' to debate about health care law, you at least rethink some of your presuppositions.