For hospitals, Obamacare means health care costs are going up and less help will come from the government, some health care experts say.
“Many challenges with the changes in how hospitals will be paid – that will be a problem,” said David Duggan, intermediate dean of the College of Medicine at Upstate Medical University.
The new health care law – nicknamed Obamacare – no longer faces possible repeal by Republicans in Congress since President Barack Obama was re-elected. The health care industry is starting to put in place the new requirements that go into effect from 2014 to 2020.
“They are trying to figure out how to do so,” said Debbie Freund, an expert on healthcare economics and president of Claremont Graduate University in California, because the government is “cutting what they pay for.”
Federal reimbursement, fee-for-service payments and a primary care doctor shortage are the three main issues up in the air for hospitals.
Here’s a look at how those areas affect Central New York:
- Federal reimbursement
Hospitals pay for the costs of caring for patients on Medicaid, the federal-state insurance program for the poor, and for uninsured patients with the anticipation of federal reimbursement. The federal government reimburses hospitals under what is called “disproportionate share hospital” payments. The new law reduces federal funding for those payments by $17 billion between 2014 and 2020.
“Under Obamacare, those payments will go down by 2 percent,” said Bob Allen, vice president of communications at Crouse Hospital. It serves nearly 500,000 people in Syracuse and in Central New York. In anticipation of the cuts in federal reimbursement, Crouse Hospital laid off 70 people on Nov. 8.
“We are trying to position this organization for continued strength,” said Allen.
University Hospital at Upstate Medical University also is trying to find a balance between the quality of care and the continued rise in costs, said Duggan, of the medical school.
“We are looking at cost saving for those with financial need as reimbursement changes,” said David Duggan, intermediate dean of the College of Medicine at Upstate Medical University. “We want to continue to provide quality health care to Central New York.”
- Fee-for-service payments
The new law extends health care to those without health insurance, but it does not change the fee-for-service method of payment that many say contributes to rising health care costs by encouraging medical professionals to provide some unnecessary services.
- Primary-care doctor shortage
The new law requires everyone to get a primary care doctor. But a 2011 report by the Health Care Association of New York State shows 34 percent of hospitals had to reduce or eliminate primary care services because of a shortage of primary care doctors.
Crouse Hospital brought Internist Associates of Central New York, a practice with 15 doctors and five nurse practitioners.
Both hospitals said they will be watching Congress for the next set of changes to the health care industry.
(Janine Mack is a graduate student studying broadcast and digital journalism.)
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