Hospitals wait on reform details

By Nicole Lucht

Friday, July 31, 2009 | 3 a.m.

You’d think that, given the high cost of providing service to uninsured patients, Las Vegas Valley hospital executives would be falling all over themselves as they express enthusiastic support for health care reform initiatives that would provide coverage for the uninsured.

And you would be wrong.

The valley’s two biggest for-profit hospital owners, Hospital Corp. of America and Valley Health Systems, and University Medical Center, Clark County’s only public hospital, declined to discuss how covering more or most of the uninsured would affect them.

It’s too early to know what Congress will do as the reform legislation works its way through committees, and the measures under consideration are politically charged, they said.

The head of the state hospital association says that while covering more people is a positive, hospitals don’t want to be stuck with reimbursement rates that don’t cover expenses and with additional costs.

Nevada ranks in the top 10 states in the percentage of its population that is uninsured, Nevada Hospital Association CEO Bill Welch said.

Nevada hospitals already provide a significant amount of care to uninsured patients, he said, as well as to those who are covered by entitlement programs Medicare and Medicaid.

“The Nevada Hospital Association understands the need for the health care reform to deal with the uninsured population,” Welch said. “We support appropriate legislation that would accomplish that, but we haven’t seen the details yet from Obama.”

But if reform results in a government plan that pays on the same threshold as Medicare and Medicaid, hospitals will be reimbursed at less than cost.

“To create another program that doesn’t cover costs is a problem,” Welch said.

To the extent that universal health care insures and pays health costs, hospitals support it, he said.

He said a government insurance product would have to be comparable to an insurance product bought on the private market.

“We’re cautiously supportive,” he said. “I hope, in the end, meaningful reform is passed.”

Medicare reimburses hospitals at 70 to 79 percent of their costs, he said.

Without the details of the proposed reform, Welch sees reform simply shifting funding from one area to another.

“It’s hard to argue with the president’s philosophy, but the devil’s in the details,” he said.

Welch said he is supportive of some portions of the proposed legislation, such as expansion of slots available for graduate students to study primary care and paid for through Medicare, and the coverage of more uninsured, who would be able to visit primary care doctors instead of emergency rooms, but if reimbursement rates don’t increase, and potentially decrease, he said fewer doctors would be willing to see those patients.

The uninsured are a special problem for hospitals. Because most hospitals have emergency rooms, uninsured patients, many of whom have not had preventive primary care, visit the facilities often as a last resort.

Out of the 120 million patient visits to hospital emergency rooms in 2006, uninsured patients accounted for one-fifth of those visits, or 24 million, according to data collected by the federal Healthcare Research and Quality Agency.

The agency surveyed 1,000 community hospitals nationwide.

“Our health care system has forced too many uninsured, rural and low-income Americans to depend on the emergency room for the care they need,” Health and Human Services Secretary Kathleen Sebelius said in the agency’s report. “We cannot wait for reform that gives all Americans the high-quality, affordable care they need and helps prevent illnesses from turning into emergencies.”

The valley’s only nonprofit hospital system, St. Rose Dominican Hospitals, is generally supportive of the health care reform measures proposed, St. Rose spokesman Andy North said.

“We support health care reform because it’s the right thing to do,” he said. “It’s why we spend so much of our funds on (unpaid care).”

He said reform could not only protect the financial viability of the health care providers, but also help keep costs low for employers and their workers.

From July 1, 2007, to June 30, 2008, St. Rose spent $72 million in patient care that wasn’t paid for at its three valley hospitals. Of that, $31 million was for non-Medicare patients. The rest, he said, was the difference that Medicare didn’t reimburse the hospital for.

From the hospitals’ perspective, it’s difficult to predict the ultimate impact of reform.

“It’s hard to say if we’ll be better off if more people are insured,” North said.

The potential problem lies in whether Congress decides on a government insurance option that reimburses hospitals on a fixed rate, such as the House is proposing, rather than a competitive pay schedule, as the Senate has proposed.

The Las Vegas Valley’s largest for-profit hospital systems declined to comment on the reform legislation.

“Because health care reform is in process, it is too soon to know the impact it could have on our hospitals,” Hospital Corp. of America spokeswoman Ashlee Seymour said via e-mail, in response to a request for comment.

Valley Health Systems, the parent of five hospitals in Las Vegas, also declined comment.

“There are various opinions,” Valley spokeswoman Suzie Wood said. “It’s very difficult for us to make a statement.”

Even University Medical Center wouldn’t comment.

“Because it’s politically charged, we’re not commenting on health care reform at all,” UMC spokeswoman Danita Cohen said.

The House and Senate bills are loosely based on an outline provided by Obama. The House bill is estimated to cost $1.5 trillion over 10 years and would require many employers to offer health insurance to their workers and individuals to carry it. The legislation would also prohibit insurance companies from discriminating against consumers with preexisting conditions. The biggest obstacles appear to be cost and tax increases, as well as how far reaching cost containment would be.

More than one-third of Nevadans under age 65 were without health insurance for all or part of 2007 and 2008, and three quarter of those were without insurance for at least six months, according to a March report by Families USA, a nonprofit advocate of universal health care.

If the bill passes as it was originally proposed, there would be an additional 233,000 Nevadans with insurance by 2013, another Families USA report said in July.

The group based its findings on a report released in July by the Congressional Budget Office that estimated the House bill would add coverage for 23 million Americans in 2013 and 37 million by 2019.