Outside editorial: Rule change threatens health care safety net

Posted: Tuesday, February 27, 2007

This editorial appeared in the Miami Herald:

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Hospitals in Florida and other states with large poor and uninsured populations face a devastating loss of federal funding if a rule change proposed by Medicaid administrators is adopted. Congress should intervene to prevent a health care disaster. Medicaid officials say the new rule will force states to increase their Medicaid funding to cover the losses. But at best that is a risky gamble; at worst it is an abandonment of federal responsibility.

The rule would change the funding formulas by which hospitals are reimbursed for treating the poor. It would exclude local contributions that have been used to increase states' federal-funding match. The change would cut billions of dollars in health care costs from the federal budget.

In Florida, hospitals would lose $4.6 billion in federal Medicaid funds over five years, according to the Florida Hospital Association. This translates to a funding cut of $300 million next year in South Florida alone. By far the hardest hit would be Jackson Memorial Hospital, Miami-Dade's safety-net hospital, which estimates it will lose $125 million annually.

How does a public hospital that provides the bulk of Miami-Dade's charity care contend with a shortfall of this magnitude? Fewer services would be inevitable, Jackson CEO Marvin O'Quinn says. Already-lengthy emergency-room waits will be stretched even longer; and some people may not get treated. Medical decisions would be difficult: Does a hospital cut a transplant program, primary care or doctors' salaries?

And where do the uninsured go when the safety-net hospital can't treat them? Private hospitals that serve uninsured and undocumented people also will face funding cuts. The result: Desperate people likely will delay treatment until their illness is unbearable. The human and financial costs for local communities will skyrocket.

The Centers for Medicare and Medicaid Services, which proposed the rule change, says that Medicaid is not supposed to cover uninsured or undocumented people. "It's the states' obligation to come up with their share of Medicaid matching funds from legitimate sources," CMS spokeswoman Mary Collins said.

Yet only two years ago, CMS approved Florida's "Low Income Pool," a program designed to compensate hospitals that provide extraordinary care for Medicaid and uninsured populations. Now hospitals and the state Agency for Health Care Administration are concerned that the rule change will threaten the pool's funding.

Moreover, federal-government policies have caused or contributed substantially to the growing numbers of uninsured and undocumented people. U.S. immigration policy, for example, promotes immigration in some cases, but fails to stop unwanted, illegal immigrants at the border. So why doesn't the federal government pay the health care costs of poor, undocumented immigrants? It is unfair to force states and local communities to cover all such health care costs. The rule change would only worsen the inequity. Other Medicare and Medicaid reductions in President Bush's proposed budget would only add to the looming health care catastrophe.

Congress is gearing up to fight the rule change. In the House, 226 members, including most of South Florida's delegation, have signed a letter opposing the change as "bad public policy." A similar letter was signed by 43 senators. States that are trying to increase health care coverage are moving in the right direction. Ripping the nation's safety-net hospitals at a time when they are needed most makes no sense.

Congress should block this rule change.

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