Reform could cost hospitals $4B

Feb 27, 2009

By Carol Gentry
2/27/2009 © Florida Health News 

A former state health official says a clause in Florida’s Medicaid Reform plan will cost hospitals nearly $4 billion a year in uninsured emergency-room visits if the pilot project expands statewide. 

Aside from the financial impact, the influx of patients will flood emergency rooms and make it difficult for patients in need of immediate attention to get it, according to health consultant Paul Metts, former deputy secretary at DOH.

Metts sent the warning in an e-mail to DOH Secretary Ana Viamonte Ros and other public health officials after concerns began to be expressed about a change in the payment system to county health departments.

The change is part of the federal waiver that Florida obtained when it began the pilot program usually called “Medicaid Reform,” which requires that Medicaid patients not in institutions be enrolled in a managed-care plan.

The Metts e-mail was released Friday to Florida Health News by Earl Fox, director of the Florida Public Health Institute. On Thursday, he said county health departments would lose a total of around $46 million – more, actually, since the estimates are based on 2-year-old data – and sent a chart that shows a county-by-county projected loss.

Health department officials around the state “have expressed horror at this,” Fox said, but are reluctant to speak out because they are state employees.

Money will begin to shift away from health departments in the five counties now participating in Medicaid Reform beginning in September. Duval’s loss is projected at nearly $8 million, while Broward’s would be around $2 million, Fox said.

The funds, which come from the state Medicaid program, underwrite the cost of health professionals who provide dental, medical and nursing care for the indigent – both Medicaid and uninsured -- who receive it through health departments. 

Health departments that treated patients under the Reform payment structure would receive a far lower rate, the same given to HMOs, he said. Without the current payments, there wouldn’t be enough money left to subsidize care for the uninsured, he explained.

Fox and others in public health are trying to persuade state lawmakers to stall any attempt to expand the Medicaid Reform project statewide, as called for in the plans of Florida’s Agency for Health Care Administration. Secretary Holly Benson has been a strong supporter of the program; her deputy, Tom Arnold, was its chief architect.

Largely overlooked in the worry about what the funding cuts would do to county health departments, Metts said in his e-mail, is what they would do to hospitals.

“The potential ‘cost shift’ is the single most important public impact issue for hospitals, physicians and patients,” Metts wrote. “(T)he additional volume necessitated by the shift in treatment location will exceed the capacity of the hospital emergency rooms, thereby delaying essential services to those patients most in need. It also has the potential to seriously erode the capabilities of Florida’s Trauma System.”

--Carol Gentry can be reached by e-mail or at 727-410-3266.