For Local Providers, Federal Health-Care Reform Not a Cure-All
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By Giana Magnoli, Noozhawk Staff Writer
With excitement about the benefits come concerns about the risks to finances and resources
Local health-care providers have one eye on Washington, D.C., as they contemplate the inherent changes coming with the passage of health-care reform legislation.
The newly enacted measure pledges coverage to millions of previously uninsured people and prohibits insurance companies from denying coverage to those with pre-existing conditions. It also will allow more people to qualify for Medicare and Medicaid.
There is likely to be a significant amount of change for all providers, said Michele Mickiewicz, public information officer with the Santa Barbara County Public Health Department. The effects — including reimbursement and patient load — are likely to be different for private, public and nonprofit organizations given the differences in patient payment methods.
As it stands now for Cottage Health System, a private nonprofit organization, there is cost shifting from those with government-paid insurance to those with private insurance, which people are “not happy about,” said Janet O’Neill, Cottage’s director of public affairs.
With about two-thirds of patients paying through government programs, and the eligibility requirements changing to allow more to qualify, there could be “quite an impact” on reimbursement, she said. It’s too soon to know specifics, but if more patients revert to payment through programs such as Medicare — which pays hospitals 72 cents on the dollar — it could financially hurt hospitals, she said.
Cottage Health System spent $14.5 million in charity care last year, and it supports the movement to make positive changes in coverage and the way patients get care, O’Neill said.
The Public Health Department’s caseload also is mostly made up of Medicare and MediCal patients, and it’s eager to know what will happen to the other 30 percent — those who self-pay and those who qualify for public programs such as Healthy Kids, Healthy Families and the Medically Indigent Adult Program.
Mickiewicz said that the 20 percent, or so, of people who self-pay are most likely watching to see if they become eligible for government programs — or private insurance — in 2014.
“There are lots of positive things (about the legislation),” she said. “There’s not a doctor or hospital out there that thinks the current system works.”
Countywide, there are 40,000 to 50,000 uninsured people, and Mickiewicz said it will be interesting to see what kinds of insurance become available to them.
The Public Health Department planned to meet Tuesday to discuss the issue and put possible changes in perspective to the care already provided.
More than 20 percent of Californians are uninsured, according to research by the California HealthCare Foundation, with many of them expected to qualify for insurance under the new legislation. Dealing in volume — regardless of whether it’s public or private insurance — could improve on the current reimbursement system since more insured people would mean at least “some payment for everybody that you see,” Mickiewicz said.
She said increased access most likely will lead to more seeking care, which perhaps could cause demand to overwhelm private institutions and even cause strain on existing county resources.
“We’re rushing to find out what it means,” Mickiewicz said of the legislation’s implications.
Nonprofit provider Santa Barbara Neighborhood Clinics has the most to gain from the bill’s passage, since most of its patients are uninsured and payments don’t come near covering the cost of care — so any insurance plans will be an improvement.
The Isla Vista, Eastside and Westside locations offer primary care, dentistry and counseling, and the organization has collaborated with other local medical providers to expand its care after having its budget slashed by the state.
An average visits costs the organization $154, while the average reimbursement is $62. The remaining gap is what the fundraising department tries to fill, deputy director Bonnie Campbell said.
Besides state and federal funds, county contracts and patient self-pay fees (which are calculated on a sliding scale based on income), the organization relies on grants and donations to sustain its budget of about $7 million per year.
Beyond supporting the health-care legislation from a morality standpoint — the group’s mission is to provide access to all regardless of ability to pay — the changes could financially benefit the clinics.
Of the nearly 16,000 total unduplicated patients in 2009, 91 percent fell below the federal poverty level. The clinics get less reimbursement from uninsured patients who self-pay than from insurance companies, so the increased eligibility provided by the health-care legislation is likely to bring in more money.
Campbell said having young people remain on their parents’ insurance until age 26 — which is also included in the bill — would factor in, since most state-funded medical programs end at age 19.
“Maybe some current patients who don’t qualify will be covered and give a decent amount back,” executive director Cynder Sinclair said. “We’re excited about it.”
The clinics also have their eyes set on the money said to be set aside for community clinics, which they say should be the model for all health-care providers.
Clinics remove barriers to access and work to deliver care in an efficient, inexpensive and mission-driven way, Sinclair said.
“We’re not asking for a river of revenue, just a stream,” Campbell said.
— Noozhawk staff writer Giana Magnoli can be reached at .(JavaScript must be enabled to view this email address).
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