Tuesday 31 December 2013

Uncertainty with health insurance lurks across the country

Will there be a blitz of new patients? Or will the costs scare them off?


By Lisa Bernard-Kuhn


 

A host of unknowns awaits health systems here and across the country as millions of Americans — some for the first time — join health insurance rolls in the new year.

From gauging whether they have enough manpower to handle a blitz of new patients — should there be one — to dealing with an expected rise in uncollected bills and loss of federal funding, health systems will be closely monitoring the newly insured to see how — and how often —they tap into their new health benefits.

Among the key promises of the Patient Protection and Affordable Care Act is the expansion of health care coverage to nearly all Americans by requiring most to enroll in a health insurance plan or face penalties. And starting Wednesday, hundreds of thousands of low-income residents across Ohio will become eligible for Medicaid benefits.

Over time, that should mean a reduction in the amount of care that health systems provide and aren’t paid for — an oft-cited reason for skyrocketing health care costs.

In Ohio alone, hospitals recorded more than $4.5 billion in uncompensated care in 2011, the most recent year data are available. Nationwide, the figure is closer to $40 billion, according to the Ohio Hospital Association.

Licking Memorial Hospital reported about $16.8 million worth of uncollectible patient services in 2011, according to tax forms.

"On the whole, the changes should be a very big boost in revenues for hospitals that do the most uncompensated care," said Allan Baumgarten, a Minneapolis-based independent health care consultant.

But in the short run, at least, health system officials say the costs of uncompensated care are very much in play.

Part of the problem is the rise in high-deductible health plans, which require consumers to pay a significant amount of their health care costs — at least $1,250 for an individual — before their insurance starts picking up the tab. And health systems are already seeing a rise in unpaid bills even though the patients have insurance, Baumgarten said.

"If someone in one of these plans runs up a $5,000 bill, the health system has to worry about collecting that first $3,000 from the family before any of the insurance reimbursement kicks in," he said.

Executives with the Cleveland Clinic and University Hospital acknowledge the growing problem, as does the American Hospital Association.

"It’s a problem providers can expect to see expanded in the next couple of years," Baumgarten said.

Of all employer-covered workers, 19 percent were enrolled in a high-deductible plan last year, more than double the rate of 2009, according to the Kaiser Family Foundation. And for a growing number of workers, the plans might be the only option they get. Gannett Co. Inc., parent of The Advocate, is among about 10 percent of companies offering the plans exclusively in 2014.

The plans also are expected to be among the most popular sold on the newly launched health insurance marketplaces, where insurance experts are expecting price-sensitive shoppers to be most attracted to the plans’ lower monthly costs.

"I think it is still very much unknown, just how many people will be slow or unable to pay," Baumgarten said.

And whether policy holders will tap into their new benefits quickly or delay treatment to avoid the out-of-pocket costs remains to be seen.

"Some say there is a pent-up demand of people who will come in for care because they haven’t had good or any coverage in the past," Baumgarten said. "The other perspective is that most of these people were getting care somewhere before, but it was expensive care through (emergency rooms) or community health centers. In the next couple of years, we’ll have a much better idea of how this has impacted volume."

Also top of mind for hospital operators is the loss of millions of dollars in federal funding in the New Year.

Just this month, health executives from more than 200 health systems, including several in Ohio, urged the federal government to hold off on cuts to a program that provides additional money to hospitals that serve many low-income patients. For Ohio hospitals, the move will mean about $1 billion less in federal funding during the next two years.

The cuts, mandated by Obamacare, passed with the expectation that hospitals would deliver less uncompensated care because states would expand Medicaid eligibility to millions more low-income adults. But the U.S. Supreme Court last year made Medicaid expansion optional for the states, and about half the states have not expanded their programs. Kentucky did so about midway through 2013, and Ohio made the move in late October. Only this month did the state’s Supreme Court uphold the decision.

Health systems are asking for a three-year freeze on the cuts to allow states additional time to expand health care coverage.

"If these crippling cuts are not stopped, our hospitals will be forced to curtail essential services, ultimately limiting access to care and cutting jobs," according to the letter.

Source The Cincinnati Enquirer

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