Genesis Unites With Area Hospitals in Support of Responsible Medicaid Expansion
(Jan. 31, 2013) Matthew Perry, Genesis Health Care System CEO, joined Robert Miller, Coshocton County Memorial Hospital CEO; and Ray Chorey, Southeastern Ohio Regional Medical Center CEO; in support of responsible Medicaid Expansion in Ohio. The CEOs agree that an expanded program would improve access to care for more members of their communities and help to curb rising health care costs.
The Affordable Care Act (ACA), which was signed into law in March 2010, calls for expanding Medicaid coverage effective Jan. 1, 2014. The act increases Medicaid eligibility to include adults with incomes up to 138 percent of the federal poverty level (FPL). Currently, Medicaid covers adults as follows: 1) Parents of children on Medicaid with incomes up to 90 percent of the FPL 2) Disabled adults with incomes up to 64 percent of FPL 3) No coverage for childless adults. In June 2012 the U.S. Supreme Court made it optional for states to expand.
More than 1.5 million Ohioans have no insurance, and Medicaid expansion would provide access and care to thousands of Ohioans. The Kasich administration said its decision would be announced in February with the release of the next two-year state budget.
Ohio’s hospitals provide more than $1.2 billion per year in uncompensated care to the uninsured. These costs are at an all-time high and have grown by more than 50 percent over the last five years. The cost of this care is borne by the hospitals, employers and privately insured families in the form of higher health insurance costs. Without expansion, these costs will continue to rise.
Genesis, Coshocton Hospital and Southeastern Med share a mission to meet the needs of all members of their communities, regardless of their ability to pay, and this is a commitment they will not waver on. However, the leaders believe Medicaid expansion presents opportunities to reduce the cost of care and enable the hospitals to continue fulfillment of their missions.
“Most uninsured patients do not have primary care physicians nor the resources to pay for routine wellness checkups. They use the emergency department as their primary source for care. By the time they receive care, their health has deteriorated and they require a higher, more costly level of care,” stated Miller.
Medicaid expansion with more personal responsibility presents an opportunity to steer individuals to patient-centered medical homes where there will be better care coordination in appropriate clinical settings. This will improve the overall quality of care and reduce cost for everyone – hospitals, employers, privately insured individuals and the state.
Hospitals with a significantly disproportionate share of low-income patients receive some relief for the uncompensated care they provide through a federally mandated program supported by federal funding. In anticipation of Medicaid Expansion, which would reduce the amount of uncompensated care, the ACA also includes a provision to reduce Ohio’s disproportionate share hospital (DSH) allotment by almost $1.5 billion over the next ten years.
“DSH funding and Medicaid Expansion are intrinsically related, and reducing DSH funding without expanding Medicaid will create a significant financial hardship on hospitals like ours. Medicaid expansion will reduce the growth of uncompensated care by providing coverage to more individuals, and reduce the cost-shifting, thereby helping to reduce costs for employers and insured Ohioans,” stated Chorey.
A recent study suggests that a Medicaid expansion in Ohio would provide a federal match of $3.5 billion in fiscal year 2014-2015 biennium to pay for the expansion. This represents a net gain to the state budget of $366 million in the FY 2014-2015 budget through savings in other state-funded programs, and additional revenues from taxes and rebates ($1.4 billion net through FY 2022).
The availability of enhanced federal match, especially in the first three years, provides the state with the resources needed to continue the Medicaid transformation to instill personal responsibility and ensure the health and productivity of Ohio’s workforce.
“This is a critical decision with major ramifications for the overall health of our region and the long-term stability of health care costs for the entire state,” stated Matt Perry. “We stand together in support of this expansion with the belief that it is in the best interest of our communities. We will be paying the federal taxes either way, and the expansion will return these tax dollars to Ohio to improve the lives of Ohioans,” Perry added.