Senior leaders at patient care organizations nationwide have been trying to prepare for what might come next in terms of healthcare policy, payment, and regulatory developments, after Congress passed a huge tax and immigration bill on July 3, and President Donald Trump signed it into law on July 4.
As noted in our report, the legislation—which renews a massive set of tax cuts for some taxpayers and some corporations—cuts about $1 trillion from Medicaid, while also reducing spending on anti-hunger programs, including SNAP, the Supplemental Nutrition Assistance Program formerly known as food stamps, by $185 billion. The Congressional Budget Office (CBO) estimated that the bill would add around $4 trillion to the national debt.
As we had reported on July 2, the healthcare consumer advocacy group Families USA published an analysis of the legislation as it was going through the Senate; that analysis found that the legislation would “further jeopardize revenue for states by imposing new definitions that limit the structure of provider tax revenue under state Medicaid 1115 waivers. Many states will need to significantly restructure their current financing of Medicaid, including likely reductions. The Senate Finance proposal clarifies that states are allowed to make changes to provider taxes to come into compliance with the provider tax provisions of the bill. CBO estimates the House and Senate provisions would cut $34.6 billion over 10 years,” Families USA explained.
With Medicaid-insured patients being dropped from the Medicaid rolls—thus bringing more uninsured patients into emergency departments rather than through the Medicaid program—and with provider-tax revenues being potentially strongly disrupted—and, in addition, with mandatory Medicare budget sequestration looming ahead because of the impact to the federal budget deficit—hospital, medical group, and health system leaders are having to gear up for a challenging future, certainly in the short to medium term.
In the midst of all this, health system senior leaders are preparing for the rigors of the near-term future one of them is Judy Bruno, R.N., president and CEO of WVU Medicine Barnesville and of WVU Medicine Harrison Community Hospital, two hospitals within the 25-hospital WVU Medicine health system. Like so many senior leaders leading rural health systems, Judy is both realistic and also determined to make it all work. As she told me this week, “Most hospitals that operate in rural America don’t have strong operational margins anyway. We’ve always had to be very good fiscal stewards of resources. We need enough net income to pay our people, buy equipment, and replace infrastructure. And even though Medicare doesn’t reimburse at the level of a commercial payer, we do get something. If people were to lose that coverage and there were no shoring up of that revenue, our belts would become even tighter.”
What will patient care leaders have to do? “Some hospitals might have to make decisions,” Judy told me. “My hospitals don’t have labor and delivery, but some hospitals might be forced to shut that down. And that will mean many patients being forced to drive 40-50 miles, or more” to obtain obstetrical care. Similarly, in cases of “mild myocardial infarction,” Judy noted, the shuttering of rural hospitals could lead to adverse outcomes, as “every single moment without care can mean more cardiac cells die. If there’s not access to stabilizing care, rates of mortality can increase; the same is true of course in terms of stroke patients. And,” he quickly added, “as someone with a clinical background, I worry about access to care, outcomes, and long-term outcomes, if the only hospital in a community has to close services or close down. Another point to make is that a lot of times, hospitals like my two are the biggest employer in the town. If a hospital goes away, so does the income, the earning power of the people in that community.”
I asked Judy what active steps health systems leaders might take right now, in this complex moment. “They can open very open dialogue with their state legislatures,” she said. “Create open dialogue with state legislators so they can understand the challenges with tight margins. And explore various contracting possibilities.”
It was clear to me in speaking with her, that Judy Bruno will be one of those CEOs who will move forward with resolve to move her hospitals forward, and will reject the passivity that could prove deeply problematic later on.
Want to learn more? Please join us at the Ritz-Carlton in downtown Washington, D.C. on Monday, August 18. It’s super-easy to register, and here’s the registration form.
In a time of change and uncertainty, it’s so important to hear from leaders like Judy Bruno and others. We’ve got a program full of great sessions, focused on healthcare policy, accountable care and alternative payment models, analytics and artificial intelligence, and cybersecurity. You’ll be glad you joined us!
About the Author
Mark Hagland
Mark Hagland has been Editor-in-Chief since January 2010, and was a contributing editor for ten years prior to that. He has spent 30 years in healthcare publishing, covering every major area of healthcare policy, business, and strategic IT, for a wide variety of publications, as an editor, writer, and public speaker. He is the author of two books on healthcare policy and innovation, and has won numerous national awards for journalistic excellence.