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Hospitals anxiously eye ACA reforms

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Now that U.S. House Republicans are considering a bill they say will repeal and replace the Affordable Care Act, leaders of hospitals and hospital associations across the country are monitoring the details and trying to determine how the replacement plan would affect their bottom line.

Many of the hospital associations interviewed said it’s too early to tell how the GOP’s plan, the American Health Care Act, would affect hospital revenue, although the biggest changes are to the Medicaid program, which provides coverage for low-income people.

Under ACA, also known as Obamacare, more than 20 million people got health insurance through marketplace subsidies and Medicaid expansion. If repealed, hospitals would have to change the way they operate and how they calculate revenue.

Andy Carter, president and CEO of the Hospital and Healthcare Association of Pennsylvania, said although he did not yet have the official details of the GOP’s plan, the plan “raises concerns that it does not fulfill our core principle that any replacement plan must ensure continuity of coverage and care through access to a robust, competitive delivery system.”

Carter said the significant changes to Medicaid in the GOP’s plan would “negatively impact” Pennsylvania and the 30 other states that expanded access to it. In Pennsylvania, 1.1 million people are covered through the ACA, including 700,000 through Medicaid expansion.

“The financial burden that is seemingly being shifted to low-income individuals, many of whom are working, jeopardizes the important progress we have made to provide these individuals with the right care, in the right place, in the right time,” he said.

Carter said the ACA’s tax credits that are advanceable and refundable “are superior to tax deductions” proposed in the Republicans’ bill. The GOP tax credits would be tied largely to age, with older people getting twice as much as younger people. But insurers could charge older adults five times as much as younger adults under the Republican plan.

RESTORE CUTS TO HOSPITALS

Sean Hopkins, senior vice president of federal relations and health economics for the New Jersey Hospital Association, said that whatever happens, the association would like to see a replacement enacted simultaneously with a repeal.

“If the replacement doesn’t occur simultaneously with the repeal, Congress should restore the cuts hospitals absorbed in support of the ACA’s coverage expansion,” Hopkins said.

He added that New Jersey hospitals have contributed $1.4 billion between 2010 and 2017 in support of the ACA; post-acute providers in New Jersey have contributed $430 million.

SEEKING TO PRESERVE COVERAGE

The association has been doing all it can to educate its members about the possibilities that could occur, including block grants and per capita cuts to the Medicaid program, Hopkins said.

“We continue to monitor the happenings in Washington on an hourly basis and are feeding as much information and insight to our members as quickly as we can,” he said.

About 1.8 million New Jersey residents are covered by the Medicaid program – 20 percent of the state’s population – and 28 percent of all newborns in the state are covered by Medicaid, Hopkins said.

“We want to protect these residents,” he said.

AWAITING DETAILS

Maryland hospitals deferred comment on how a repeal might affect their revenue to the Maryland Hospital Association.

“At this time, it would be premature to plan for federal changes without having details,” Carmela Coyle, president and CEO of the Maryland Hospital Association, said in a statement. “During this national debate, hospitals need three things to help them meet their mission of care: broad-based, continuous health coverage; high-functioning insurance markets; and value-driven care incentives. No matter what policy is enacted, these will be essential to provide the right care, at the right time, in the right setting.”

Neil Meltzer, president and CEO of the Baltimore-based LifeBridge Health, said, “LifeBridge Health believes the access and affordability provided by ACA are vital to our patients and our community, and we hope, in whatever form health care is changed, both are maintained.”

WANTS REPAIR OR IMPROVEMENT OF ACA

Wendy Burt, vice president of communications and public relations for the Minnesota Hospital Association, said that Minnesota is one of the five states with the lowest uninsured rate and believes that the ACA “could be repaired or improved.”

“That said, we would like to see replacement happen simultaneously if the ACA is to be repealed,” Burt said.

Uncertainty at the federal level affects decisions being debated at the Minnesota state capitol, including the creation of a reinsurance program to stabilize the individual market and what to do with surplus funds in its Health Care Access Fund, Burt said.

MHA believes that future surplus should be used for health care coverage for low-income Minnesotans, because the state may have to pay a larger share if the federal match is reduced.

POTENTIAL $2B IN FUNDING LOSSES

Minnesota is one of only two states with a basic health plan, and 90 percent is paid by the federal government. A public option allowing Minnesotans to buy into MinnesotaCare, the basic health plan, is being considered by the legislature to stabilize the market, Burt said.

MHA would like to see all Minnesotans have health insurance coverage and have coverage that provides essential benefits (a component of the ACA that the association supports), she said, adding it also wants enhancement of public health insurance programs.

The group has not calculated the losses or gains in revenue if the ACA is repealed, she said, adding, “The Minnesota Department of Human Services estimates that Minnesota may lose as much as $2 billion annually in federal funding that is received for coverage of our Medicaid expansion population.”

(Lehigh Valley Business reporter Wendy Solomon contributed to this story.)

 

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