Much has been written about the 20 million people who gained health insurance under the Affordable Care Act, and what could happen to these patients if the ACA is repealed without a replacement. But some people don't realize that hospitals nationwide could take a big financial hit on several fronts, too.
First, it's likely that fewer patients would be able to pay their hospital bills, health policy analysts say, so the institutions would be stuck with that bad debt, as they were before Obamacare.
"If the Medicaid expansion goes away wholesale, and things go back to the way they were before this expansion was in place, a lot of those hospitals would see an increase in their uncompensated care costs," says Rachel Garfield, an analyst with the Kaiser Family Foundation. The American Hospital Association estimates that hospitals across the U.S. could lose more than $160 billion from the reduction in Medicaid revenue and the increase in unpaid medical bills.
Then there's this: The ACA has used financial incentives to encourage hospitals to experiment with ways to improve their care of patients, while reducing health care's cost. That sort of experimentation has included a sizable upfront investment by many hospitals.
Massachusetts General Hospital in Boston, for example, signed agreements with physicians and insurers to create accountable care organizations, in hopes of saving money in the long run. With an ACO, insurers pay doctors for making sure the patient is getting the best and most appropriate care, instead of paying for every test and procedure a doctor does.
"We have now more than 20 different programs," says Dr. Timothy Ferris, an internist and medical director of the Mass General Physicians Organization. "Video visits, electronic consultation with specialists, home hospitalization, [and] programs for patients with diabetes and heart disease. I would be worried that a repeal of the ACA would undermine our ability to invest in services for our patients."
Ferris acknowledges that most of those experiments haven't yet saved money. But they need more time to work out the kinks safely, he says.
"One of the things that it's difficult for people outside of health care to appreciate — particularly politicians — is how long it takes to make significant improvements in the delivery of care," Ferris says. "You have to be very careful when you make changes."
Ferris says the threatened repeal of the ACA makes him worry "that the progress we've made over the past five years would be threatened."
Many other hospitals across the country have invested in accountable care organizations — often overhauling their medical records systems, hiring staff and creating new services. Dennis Keefe, head of a large hospital chain called Care New England in Rhode Island, says he, too, worries about the future of his ACO, Integra.
"I think, if there's a real change in direction away from these alternative payment models, we will be assuming risk to care for a population," Keefe says."We have invested enormously to be successful in this area."
But these seismic changes in the way hospitals do business were predicated, he adds, on long-term support from the federal government — support that might disappear if the ACA is repealed.
This story is part of NPR's reporting partnership with NPR, Rhode Island Public Radio and Kaiser Health News. The Kaiser Family Foundation supports Kaiser Health News, an editorially independent program that produces news reports heard on NPR and published on NPR.org.
STEVE INSKEEP, HOST:
Now we report on the big effect that the repeal of the Affordable Care Act would have on hospitals. Exactly what effect depends on whether and how Congress makes good on a promise to replace the law. Here's what is known - the current law helps people pay hospital bills, since many more have insurance, and the law also gives hospitals incentives to give better care to patients. Here's Kristin Gourlay from Rhode Island Public Radio.
KRISTIN GOURLAY, BYLINE: Here's one thing hospitals could lose - patients who can pay. Hospitals like this one take care of anyone who walks or rolls through the emergency room doors. This is the busy ER at Rhode Island Hospital in Providence on a Friday night. Whether you have insurance or not, the ER will take care of you. If the Affordable Care Act is repealed, more people could come through those doors without insurance, people got covered, for example, in states that expanded Medicaid. And those Medicaid funds were a big deal, says Rachel Garfield with the Kaiser Family Foundation.
RACHEL GARFIELD: It is fair to say that if the Medicaid expansion goes away wholesale and things go back to the way they were before this expansion was in place that a lot of those hospitals would see an increase in their uncompensated care costs.
GOURLAY: Or unpaid medical bills. There's still a gap, says Garfield, because Medicaid doesn't always cover the complete cost of care, but it's been better than nothing. Now, if that Medicaid coverage goes away, hospitals could lose more than $160 billion nationwide according to an American Hospital Association estimate. And there's another concern.
TIMOTHY FERRIS: Well, personally I'm worried that the progress we've made over the past five years would be threatened.
GOURLAY: Dr. Timothy Ferris with Massachusetts General Hospital in Boston says the ACA encouraged hospitals with financial incentives to experiment with how to take care of patients and save money.
FERRIS: We have now more than 20 different programs - video visits, electronic consultation with specialists, programs for patients with diabetes and heart disease - and I would be worried that a repeal of the ACA would undermine our ability to invest in services for our patients that we are now investing in.
GOURLAY: Ferris' hospital has signed agreements to create accountable care organizations, or ACOs, with physicians and insurers in hopes of saving money. This is how they work - insurers pay doctors for making sure the patient is getting the best and most appropriate care, not for every test and procedure a doctor does like the typical system. Ferris knows most of those experiments haven't paid off yet, but he says they need time to work out the kinks.
FERRIS: One of the things that is difficult for people outside of health care to appreciate, particularly politicians, is how long it takes to make significant improvements in the delivery of care. Because, you know, delivering care to patients, you have to be very careful when you make changes.
GOURLAY: Or risk harming patients. Many other hospitals across the country have invested in these new networks, often overhauling medical records systems, hiring staff, creating new services. Dennis Keefe, head of a large hospital chain called Care New England in Rhode Island, says he worries about the future of his ACO - Integra.
DENNIS KEEFE: I think if there is a real change in direction away from these alternative payment models, we will be assuming risk to care for a population. We have invested enormously to really be successful in this area. We have gone from zero premium dollars flowing through Integra to a billion dollars.
GOURLAY: These are seismic changes in the way hospitals do business, and most want the government to keep supporting these innovations.
For NPR News, I'm Kristin Gourlay in Providence.
(SOUNDBITE OF KONTAKTE SONG, "MOTORIK")
INSKEEP: That story's part of a reporting partnership with NPR News, Rhode Island Public Radio and Kaiser Health News Transcript provided by NPR, Copyright NPR.