Safety Net Hospitals at Risk

In states refusing to expand Medicaid programs, many low-income individuals are likely to face even more difficulties in receiving care as a subsidy that assisted safety net hospitals is reduced under the Affordable Care Act (ACA). Policy makers reduced the subsidy because they anticipated that the raising of the federal poverty line and increased private insurance coverage would eliminate the need for it, but states’ refusal to expand Medicaid have resulted in a coverage gap.

“The conversation we are having with the congressional delegation goes like this: ‘If we don’t expand Medicaid, what is the Georgia solution to indigent care?’” said Matthew Hicks, vice president for government relations at Grady Health in Atlanta, the largest safety net hospital in Georgia. “So far they don’t have an answer.”

Safety net hospitals operate under an “open door” policy, offering care to some of the most poor, uninsured, and vulnerable patients. The cuts in safety net hospitals like Grady Health are set to total at least $18 billion through 2020. An additional $22 billion in Medicare subsidies could be cut by 2019, pending the number of uninsured who remain during and after ACA enrollment.

These cuts could also result in massive hospital staff layoffs, or complete system closings. Expansion of Medicaid would have likely saved a good portion of lost subsidies. Overall, many safety net hospitals feel frustrated by shockwaves of the ACA.

“We’re not going to see the relief that we were hoping for,” said Ron McMullen, CEO of Christian Hospital in St. Louis, a safety net hospital that serves a large area of Northern St. Louis County. “If we’d had this conversation 14, 15 months ago, I would have told you I thought this was really going to help this hospital and help this community. Unfortunately that’s not going to happen now.”

Around the Web

Cuts in Hospital Subsidies Threaten Safety-Net Care [The NY Times]

Hundreds Of Safety Net Hospitals Face Uncertain Future [NPR]