Las Vegas Sun

March 28, 2024

Hospital rate hikes limited to 3.8 percent

CARSON CITY -- The state is notifying five major Las Vegas and Reno hospitals, which earned $78 million in profits last year, that they will be able to raise patient rates by no more than 3.8 percent starting July 1.

Under a 1991 law, these for-profit hospitals are limited to boosting rates by no more than the Consumer Price Index for the preceding 12 months. This figure is computed by the U.S. Labor Department.

Chris Thompson, an administrative services officer for the state Department of Human Resources, said this will permit the five hospitals to boost bill charges. But he noted that few patients pay the full billed charges.

"It's unlikely patients will be paying the full amount (3.8 percent)," Thompson said, adding most patients have insurance.

The Las Vegas hospitals are Sunrise Hospital and Medical Center, which last year earned $21.2 million in profit, Valley Hospital Medical Center, which reported $19.1 million in profit and Desert Springs Hospital, which registered a profit of $11.2 million.

Also under the rate limitation in Reno are Washoe Medical Center, which posted a profit of $18 million and St. Mary's Regional Medical Center, which made $8.4 million.

The 3.8 percent is the lowest permitted since the law was enacted at the request of Gov. Bob Miller in an effort to stem rising hospital costs, among the highest in the nation at that time.

Hospitals, after negotiating with Miller, agreed to freeze rates for 18 months and then abide by the index. Hospital rates were allowed to rise by 7.4 percent in 1992-93; by 6 percent in 1993-94 and by 4.8 percent last year.

Other hospitals in Nevada can raise rates without limitation.

The state Health Care Financial Analysis Unit reported earlier this month that the cost of a hospital admission decreased for Nevada patients in 1995. Hospitals received an average of $6,578 for each patient admitted, about $9 less than in 1994.

But at the same time patient costs were being held down, profits were going up. The unit said the profit per admission rose from $214 in 1994 to $413 in 1995. The reason for the big jump in profits, according to the analysts, was that University Medical Center in Las Vegas did not lose as much money this year and Washoe Medical Center and St. Mary's, both in Reno, had major increases in their profits.

Thompson said he doesn't have any national publication to allow him to measure how Nevada is doing in holding down hospital cost compared to other states. Nevada used to have the top prices and top profitable hospitals in the nation.

archive