Indiana University Health wouldn't say anything more about shelving expansion plans for Methodist Hospital other than a brief e-mail that contained this:
“Because of several external factors, such as lingering recession and healthcare reform-related uncertainties, IU Health has delayed the construction until it can fully ensure the design of the new critical-care bed tower will align with the future healthcare environment.”
The statement went on to say that “the design and timing of future construction is uncertain.” Plans had called for a critical-care bed tower to meet patient demand.
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As Congress and the White House wrangle over a compromise to avert the fiscal cliff, the anxiety (for hospitals) and expectation (among experts) regarding possible Medicare cuts is clear, as my colleague Jessica Zigmond reported.
Now, new reports on state budgets suggest continued strain on Medicaid (another major insurer) despite a modest recovery under way.
State budgets have recovered slowly from the last recession. Medicaid, which is jointly financed by states and the federal government, accounts for the single largest state expense. Medicaid paid $152.5 billion to hospitals in 2010, or nearly one-fifth of spending on U.S. hospitals that year.
Even the good news about state budgets comes with a caveat. For the first time since the downturn, state revenue in the coming year will exceed revenue states collected in 2008—but only without adjustment for inflation, the National Association of State Budget Officers reported last week. (It is “a turning point,” the group said.)
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As my colleagues and I reported this week, the re-election of President Barack Obama eased some of the uncertainty over the future of the Patient Protection and Affordable Care Act.
Hospitals and doctors, state policy makers and federal regulators must now grapple with fast-approaching deadlines, the flood of new rules needed to put the law in action and the immediate threat of the fiscal cliff, as Jessica Zigmond and Rich Daly wrote in this week's magazine. But the election secured a champion of the law in the White House for four more years.
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Economists, physicians and policymakers have put forward alternative arguments for how to best curb health spending in separate papers published online by the New England Journal of Medicine.
What follows are summaries of the pair of proposals, one that relies on state regulation, federal incentives and Medicare policy to push reforms and another that would convert Medicare from a guarantee of benefits for seniors into a program that provides enrollees with a subsidy to buy insurance.
The former was recommended by nearly two dozen health policy experts including recognizable names such as Dr. Donald Berwick, former head of the agency that oversees Medicare and Medicaid; David Cutler, a Harvard University health economist; and Peter Orszag, former director of the Office of Management and Budget.
The 23 authors made 11 recommendations, which you can read in full here (PDF). The list, they wrote, included proposals with a chance of working and being adopted.
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The Robert Wood Johnson Foundation announced plans to spend up to $1.2 million on case studies of private-market accountable care organizations.
The foundation said it would award up to $400,000 each for as many as three projects to study how markets may help or hinder accountable care organizations and ACO results in four areas: quality, cost, patient experience and health disparities.
To qualify as an accountable care organization in the study, an ACO must operate in the private market.
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Here's how the Congressional Budget Office neatly explained its revised projection for insurance coverage and costs, now that the Supreme Court made optional one major provision to decrease the number of uninsured under the health reform law: More uninsured, more coverage through exchanges, less Medicaid growth.
States may ignore a provision in the health reform law to expand eligibility for Medicaid without the risk of a penalty after the Supreme Court's recent decision on the health reform law.
The CBO said compared with pre-Supreme Court decision projections, Medicaid and the Children's Health Insurance Program will cover 6 million fewer people and spend $289 billion less through 2020 if some states, as predicted, do not expand the safety net under the health reform law.
The law's other major source of insurance expansion—subsidized health plans sold through state exchanges—are projected add 3 million additional people compared with prior estimates, should some states opt out of expanding Medicaid. The growth will increase spending by $210 billion through 2020.
And 3 million more will be uninsured.
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Safety net hospitals could see revenue squeezed on more than one front under health reform.
As my colleague Maureen McKinney reported this week, safety net hospitals may fail to earn performance-based payments, according to research published in the Archives of Internal Medicine.
The authors compared performance of safety net hospitals on patient experience measures tied to value-based payments and found they “performed more poorly than other hospitals on nearly every measures of patient experience and that gaps in performance were sizable and persistent over time.”
Under value-based payments, Medicare holds onto 1% hospital payments, which is allocated based on hospital performance.
Meanwhile, health reform, as signed into law, included a shift in the financing of healthcare for people who cannot afford it. The law reduced subsidies to offset hospital losses on uninsured patients by $36 billion over 10 years. But projected 34 million would gain subsidized insurance through Medicaid, the Children's Health Insurance Program or exchanges under the law. Hospitals would see fewer direct subsidies for the uninsured as more patients gain insurance.
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Health insurance did less and less to protect the finances of women as the last decade progressed, the Commonwealth Fund reports.
By 2010, nearly one out of five (18%) of insured women paid enough for medical care out of pocket that they could qualify as underinsured, says a newly released report by the Washington health policy outfit.
That's up from 16% in 2007 and 12% in 2003. The label of underinsured is awarded to households that spend at least 10% of their income on healthcare (5% for low-income families) or have deductibles that amount to at least 5% of income.
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The healthcare reform law's Medicaid expansion would provide coverage to roughly 11.5 million adults who live below the poverty line but are currently ineligible for the safety-net insurance, the Urban Institute estimates. But should states choose not to expand Medicaid, those adults would be left out of the reform law's push to reduce the number of uninsured.
With income below the poverty line, they would be paradoxically too poor to qualify for subsidies under the law to buy commercial health plans. Those subsidies are available for those with income above the poverty line up to 400% of that threshold. (Not everyone will be able to hold on to subsidized insurance as income fluctuates with a change in jobs or hourly work schedules.)
For hospitals, fewer insured would undermine one proposed benefit of the Patient Protection and Affordable Care Act: fewer unpaid medical bills.
Here's a look at the states, ranked by the number of adults who are currently ineligible for Medicaid yet living below the poverty line, as estimated by the Urban Institute's Health Policy Center.
Source: Urban Institute
*Urban Institute researchers advise caution for Vermont's estimate of <1, which has a standard error of more than 30%.
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Not all of those who gain insurance under the healthcare reform law will stay insured if Florida and other states decide to forgo a Medicaid expansion by 2014, as I reported last week.
So what does it mean to be insured only part-time? Unsurprisingly, research suggests it means less access to primary care and more medical debt that hospitals, doctors and households hope to see reduced by the reform law.
Those who end up insured part of the time were less likely than those insured nonstop to see a regular doctor, get their blood pressure checked or undergo routine cancer screening, a Commonwealth Fund survey found.
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Not all of those who gain insurance under the healthcare reform law will stay insured if Florida and other states decide to forgo a Medicaid expansion by 2014, as I reported last week.
So what does it mean to be insured only part-time? Unsurprisingly, research suggests it means less access to primary care and more medical debt that hospitals, doctors and households hope to see reduced by the reform law.
Those who end up insured part of the time were less likely than those insured nonstop to see a regular doctor, get their blood pressure checked or undergo routine cancer screening, a Commonwealth Fund survey found.
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