Hospitals Worried About Impact of Insurance Exchanges

by Mark Friedman  on Monday, Oct. 7, 2013 12:00 am  

“The first worry I have would be how many people will make it through the process” to buy insurance, Dorn said. “The federal government has done a good job in making it as simple as possible, but still you have to fill out a form. People don’t like to fill out paperwork.”

Chris Barber, president and chief executive officer of St. Bernards Healthcare in Jonesboro, said it will take some time to iron out the bugs in the marketplace.

“It’s like any brand new system attempting to enroll thousands of individuals,” he said. “I think patience will be important during that first enrollment period.”

High Deductibles

Administrators also are on edge over what insurance plans people will choose. A problem could arise if the uninsured make a beeline for the policies with the lowest prices, because those have high deductibles.

“They’ll have coverage, but if they get sick and they have a $5,000 to $6,000 deductible, that’s not going to do them a heck of a lot of good,” Dorn said. “It means that a hospital will have to eat a lot of the costs.”

Wright agreed. “Unlike what most people may think, a lot of the hospital’s bad debt expense is the balance after insurance,” said Wright, of Howard Memorial Hospital. “Oftentimes, patients who are just uninsured and not eligible for Medicaid, we can set up some financial assistance for them.”

Caldwell, of the DeWitt and Dumas hospitals, said hospitals in southeast Arkansas already tend to have more uncollectable accounts than hospitals elsewhere in the state, and adding even more bad debt could be disastrous.

“It’s a real drain on cash flow and productivity as well,” Caldwell said. “If you can’t collect it on the bills, you can’t replace equipment. You can’t give raises, which makes it difficult to recruit.”

UAMS’ Townsend said high-deductible plans are less of a concern for UAMS, but it’s something the hospital is “keeping an eye on.” She said many of the uninsured patients who come to UAMS will qualify for the “private option” coverage, Arkansas’ unique program of using new federal dollars to buy private insurance on the exchange for the working poor rather than expanding the Medicaid program as the federal law originally anticipated.

Rates From Carriers

Reimbursements for care from the insurance carriers participating in the exchange will also be discounted when compared to the rates the private insurers currently pay for various procedures, Townsend said.



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