Rural hospitals have long struggled to stay open. They have far fewer patients and thin profit margins. Dozens have closed across the country in recent years, mostly in states that didn’t expand Medicaid.
But in Illinois, which did extend Medicaid to nearly all poor adults, patients at Perry Memorial have gained coverage under the Affordable Care Act and many hospitals have found firmer footing.
If large numbers of people lose their insurance under the Republicans’ replacement, the hospital’s finances — and those of its patients — would be at risk, especially after the hospital invested so much money and time in complying with the health law, said chief executive Annette Schnabel.
“We have spent the last six years gearing up towards everything that we were responsible for doing in the ACA,” said Schnabel. If the hospital has to “totally go a different direction, how will we do that? It’s going to take a lot of work.”
And for some hospitals to survive or break even, it would require Congress to restore billions of dollars in funding that kept hospitals afloat before the 2010 law took effect.
Hospitals across the country made a high-stakes trade when they signed on to the Affordable Care Act. They agreed to massive cuts in federal aid that defrayed the cost of caring for the uninsured. In exchange, they would gain tens of millions of newly insured customers. Now that deal is in jeopardy, and many hospital executives anxiously await whatever comes next.
Two hospital trade groups — the American Hospital Association and the Federation of American Hospitals — have warned of “an unprecedented public health crisis” if the law gets hastily scuttled.
They say if Congress repeals the law entirely and 20 million people are kicked off their insurance, hospitals will lose $166 billion in Medicaid payments alone in the next decade.
And hospitals face much steeper losses if certain Medicare cuts that were part of the law aren’t restored.
The health law also shifted the business model for U.S. hospitals. It offered them financial incentives to move away from expensive ER visits to primary care and managing chronic conditions.
Earl Williams Sr. finally has brought his diabetes under control. He’s diligent about exercising, taking his medication and seeing his doctor.
“I had high sugar levels, I had high blood pressure, there was quite a few things that was going on with me that now I know how to control,” said Williams.
Before the Affordable Care Act, hospitals had little incentive to reduce emergency department visits, especially from Medicare patients who generate a lot of revenue.
The uncertainty is also roiling county governments, which often fund medical care for the poor.
The burden on local taxpayers to fund the Cook County health system has dropped by $300 million since the health law went into effect, and repealing the law could force local governments to raise taxes.
More than a dozen top Republican lawmakers declined to be interviewed for this story. But a spokeswoman for Sen. Lamar Alexander, the Tennessee Republican who chairs the Senate Committee on Health, Education, Labor and Pensions, said in a statement that Alexander “is listening to hospitals, doctors, patients, state insurance commissioners, governors” as they draft the replacement plan.
The most recent draft of the Republican’s proposal would eliminate the Medicaid expansion, which covers 14 million people, by 2020. To offset the increase in uninsured patients, the plan would reverse some of the payment cuts to hospital.
Back in Chicago, patients like Earl Williams have been bringing their questions to their doctors, with the hope of some clarity.
At a recent checkup, Williams asked pointedly, “Am I going to have insurance in a month or two? That’s kind of scary for brothers that’s in the community."
