Health Care Costs, Bad Diagnosis for Providers As Well As Patients

I have often written about the rising cost of care and how it affects modern Americans. I have tried to steer my audience towards articles that help illustrate the conundrums faced by people who must put off needed health care in favor of paying rent or having groceries.

Not this time. Today, I'm going to share a commentary column from New Jersey, one which looks at another vital aspect of the cost of care: how it affects hospitals and care providers. In this case it is the cost of charity care, as Dr. Micheal Bleiman points up in his recent article for the Ashbury Park Press in New Jersey:

By law, New Jersey hospitals are required to treat all patients, whether they can pay for the services provided or not. In a majority of cases, patients without insurance are not able to pay and then qualify for charity care. Therefore, the cost of the emergency department visit, the possible admission, medications, chemotherapy, radiology services, surgery, nursing, meals, doctor consultations, etc., are provided without reimbursement to the hospital.

State law requires, based on a set formula established by Gov. Corzine's administration, that hospitals be partially reimbursed for a small fraction of the charity they provide. Under Corzine's proposed 2009 budget, the state will no longer reimburse some hospitals for charity care. He decided to break one of his own laws. It must be nice to be governor.

This is a big deal.

Southern Ocean County Hospital in Stafford provides more than $3 million in charity care a year. The state reimbursed the hospital $450,000 last year. Next year — nothing.

This is yet another symptom of our national health care crisis. No matter what your perspective is on profits in the health care industry, the fact that is as cold and hard as an operating table is that even if you have the money and have insurance, it will do you no good if the hospital you need cannot afford to stay open.

Imagine New Jersey legislating no more food stamps. Instead, supermarkets must provide qualifying families with free food. Imagine no Kids Care, the state insurance program for needy children. Instead, physicians must treat any family that qualifies and pharmacies must provide all medications free of charge. Imagine your vehicle is due for inspection, but the state closes the inspection stations. Instead, service stations and car dealers are required to inspect vehicles for free to those families that qualify.

I think the good doctor's analogies are good ones. This is part of the equation not frequently seen by those who are not in the medical (and related) fields. But wait, you say, what about non-profit hospitals and providers? Well, Dr. Bleiman wastes no time addressing that angle of the issue:

Most hospitals in New Jersey are not for profit. This means they are not responsible to investors for a return on their investment. However, they do have to pay their employees, buy pharmaceuticals and buy equipment. And they must reinvest to keep their facilities and equipment safe and up to date. They are responsible for providing the best care possible to their neighbors. Our patients demand excellent health care.

How is a private institution supposed to provide a service but not be allowed to charge for it or get reimbursed for it? Logic says sooner or later, the quality and available services have to suffer.

Thankfully, the majority of New Jersey residents don't have to worry about health care until they need it — especially in an emergency. For example, when you're driving 90 mph on the Garden State Parkway without a seat belt and your SUV rolls over, you need a well-staffed hospital that is not cutting corners just to keep its doors open.

More food for thought. Makes you really wonder doesn't it? Hospitals across the U.S. expend far more resources than they are reimbursed for in treating Medicare/Medicaid cases. Somewhere, the bottom has to drop out. Cost shifting efforts like the ones being addressed in the above excerpts simply delay the final collapse while they attempt to shift the blame for said collapse to someone else's purview.

SOURCE: "Don't burden hospitals with full brunt of charity care costs" 05/14/08
photo courtesy of Robyn Gallagher, used under this Creative Commons license