The New York Times on Saturday published a page A-1 story about how uninsured Georgians will have more difficulty getting healthcare after the Affordable Care Act (AKA Obamacare) kicks in in January. The article specifically focuses on two of the state’s largest safety net hospitals: Grady in Atlanta and Memorial Health in Savannah.
The issue arises because the authors of Obamacare assumed that most of the poor uninsured would receive treatment after they became eligible for an expanded Medicaid program. To help pay for that, they reduced funding for the Disproportionate Share Hospital Fund (DSH), which provides grants to states that are used to help hospitals that treat large numbers of indigent patients. Grady alone is expected to lose about $50 million in annual payments from the fund.
Following the Supreme Court decision that states could not be forced to expand Medicaid as contemplated in the ACA, Governor Deal announced Georgia would opt out, claiming the expansion would cost the state between $2.5 and $4.5 billion–money it doesn’t have. Without the additional revenue from treating the additional Medicaid patients, and facing the loss of most DSH funds, the hospitals are left with nowhere to go.
What are the state’s options? One, obviously, would be to expand Medicaid to cover more uninsured. The Georgia Hospital Association is already pressuring the Governor to reverse his decision. But, expanding Medicaid, while providing some relief to hospitals, isn’t the same thing as restoring the funding provided by the DSH program. And given the dislike of Obamacare by the GOP base the governor hopes will support him in a three-way primary next May, he may not want to choose that route.
Another option would be to get Congress to delay the cuts to the DSH program, thereby keeping things the way they are now, at least for a while. Rep. John Lewis of Atlanta introduced a bill in the U.S. House in May that would do that, and Sen. Roger Wicker (R-Miss.) introduced a similar bill in October. Lewis’s bill is cosponsored by all the Democrats in the Georgia delegation, however none of the Georgia Republicans have signed on. The prognosis for the bill’s passage, according to govtrack.us, is slim to none.
A third option would be for the Georgia Legislature to replace the DSH reimbursements with state funding. But money is tight, and it’s unclear what would be cut to pay for it. After voters soundly rejected a 2010 plan to charge a $10 annual car tax that would have raised $80 million annually to pay for trauma centers, and after the governor last year had to finesse an extension of the hospital bed tax that helps pay for some Medicare coverage, it’s unclear whether the legislature will have any interest in fixing the problem. This is especially true in an election year session that is likely to go by quickly.
And of course, there’s the ‘do nothing’ option, leaving hospitals to try to solve the problem on their own. Three rural Georgia hospitals have already closed down because they don’t see a way to make it financially. And as Jim Galloway notes in his weekend column, the state’s Democrats, especially gubernatorial hopeful Jason Carter, are prepared to make political hay over any hospital closings or cuts in services.
There may be yet another way to solve this problem that I haven’t thought of. (Ideas and suggestions are welcome in the comments.) But, this issue isn’t going to go away quietly, and I suspect you’ll be hearing a lot more about it over the next year.