Here’s an interesting article in the (Springfield) State Journal-Register that might provide some insight into the Moses Cone -BCBS standoff.
The article’s not real clear, but the bottom line is the state of Illinois is borrowing money to make Medicaid payments to hospitals. Wait for the punchline:
“Borrowing is really the only option,” said Carol Knowles, spokeswoman for state Comptroller Dan Hynes.
The three-year plan is geared to help hospitals handling the most patients on Medicaid, the joint state/federal health-care plan for the poor. It works by shuffling money between the state and hospitals, thereby triggering federal reimbursement for the state’s Medicaid spending.
Hospitals gain $1.4 billion over three years, or $470 million each year. The state wins a three-year total of $390 million, and the feds pick up the $1.8 billion tab.
In Rockford, SwedishAmerican Hospital is counting on $16.5 million to expand its obstetrics unit, which handles most local Medicaid pregnancies, and to make general hospital infrastructure improvements. It slated $8 million to $10 million to buy the old Highland Hospital in Belvidere.
“The (ordinary) payment stream for Medicaid basically doesn’t even cover our cost of providing care,” said CEO Bill Gorski. “So when an infusion or a potential infusion like this is coming in, we’re able to look at doing things that maybe we weren’t able to do in the past.”
The state completed the first year of the program. But it couldn’t execute the second year by spring, as required under Illinois law, because lawmakers had not authorized the spending.
The state borrowed $900 million to kick-start the second-year cycle anyway. But without the power to spend that money, the state couldn’t make a single payment to hospitals by the time it had to pay off the loan in early June. The state paid $12 million in interest on the loan.
Again, the issue not being discussed in the Cone-BCBS is that hospitals are getting stiffed on Medicaid payments, so operating costs are either picked up by the government, as is the case in Illinois, or shifted to private insurers, which is the case in Greensboro. Does anyone believe the situation will improve if the federal government gets complete control of the healthcare system?
Lest anyone think I’m defending Cone on this issue, I’ll refer them to the comments below the article. Some of the questions might apply to Cone, or any other hospital, for that matter:
There are a lot of unanswered questions here. Here are some of them: how efficiently are these hospitals managed? How much do they pay their top executives. Do they check to see if patients have insurance before signing them up for Medicaid when they arrive at the hospital. (In Chicago’s notorious Stroger Hospital, lazy patronage staff have failed for years to bill insurance companies or the government, costing taxpayers hundreds of millions).
Why do these hospitals have so many Medicaid patient? Do other hospitals in the area turn them away. Why? How do these hospitals rate on various quality measurements. What is their rate of medical error. Are we shunting Medicaid patients off to low-quality hospitals and paying billions for the privilege. Showering hundreds of millions on poorly run hospitals which give poor care, if such is the case, is hardly the road to a better health system in Illinois.
Or anywhere, for that matter.
