Georgia’s Healthcare Outlook

While the General Assembly scrambles to figure out how to keep bridges from collapsing without raising taxes, another seemingly mountainous topic is creeping up: Healthcare. We’ve written about rural healthcare and the Grady/Blue Cross Blue Shield debacle, but those two problems don’t begin to scratch the surface of our healthcare situation. The Albany Herald did a very nice write up on the trends and surprises in Georgia’s healthcare outlook.

Affordable Care Act

The gift that keeps on giving higher premiums is the main topic for discussion within the medical field. The law has extremely altered the healthcare industry. Governor Deal has firmly stated he is not willing to expand Medicaid; however, with Georgia’s hospitals screaming for financial assistance, could support for expansion grow?

The Georgia General Assembly passed laws last year to place obstacles to ACA implementation in the state. One prohibited the state from expanding Medicaid without legislative approval. Opponents of expansion say it’s too costly overall.

Advocates’ campaign for Medicaid expansion has gone nowhere in Georgia. Some Republican governors, including critics of the ACA, have accepted expansion in their states. But Gov. Nathan Deal has stood firmly against it here. And last year Deal easily defeated a pro-expansion Democrat.

Rural Healthcare

I have said it before and I will say it again: Rural healthcare will be a major issue this session. Four rural hospitals closed in the past two years, 15 are facing serious financial woes, and six are on the verge of closing according to HomeTown Health, an organization representing rural hospitals. Additionally, only 75 of Georgia’s  180 hospitals have labor and delivery units.

The Herald summed up the most important question:

Georgia has seen four rural hospitals close in the past two years. Rural Georgia also has major shortages in primary care physicians. Will there be meaningful changes to help sustain rural health care this year, or will access to care in these areas continue to erode?

Certificate of Need

You will frequently read about Certificate of Need (CON) battles during this legislative session. The brewing battle over CON pits hospitals against physicians.

Meanwhile, hospitals are expected to defend the state regulatory apparatus against attempts by physician groups looking to operate doctor-owned multi-specialty surgery centers. This certificate-of-need battle is expected to heat up in the Georgia General Assembly.

Medical Marijuana

State Representative Allen Peak’s HB1, also known as Haleigh’s Hope Act, would provide THC-reduced medical marijuana to children suffering from upwards of 100 seizures a day. The medicine has reduced the number of seizures in some of the kids to one or two a week. It is facing opposition and still has a long road to travel.

Children’s health issues figure to take a prominent profile when the Legislature convenes. A push for to allow children with seizure disorders to be treated with medical marijuana already has gathered momentum. Experts say that unlike last year, a bill to allow cannabis oil for children and other patients will probably pass the 2015 General Assembly.

It will be an interesting year in regards to healthcare. Seriously, keep your eye on health related issues. It’s bound to be wild.

23 comments

  1. Spacey G says:

    This CON thing (appropriately acronym-ed) is a little baffling. As I just took a parent to a surgeon-run surgery specialty outpatient group/chop shop. In Georgia. Line ’em up, slice ‘n dice, shove patient out the door. Next.

    So it seems that already in Georgia surgeons of a certain organ specialty (for example eyes) can band together to create outpatient shoppes to operate on folk (and collect all the associated Medicare/Medicaid monies) as long as it involves just ONE organ? Such as an eyeball or an ovary? But they’re seeking to expand their revenue base, excuse me, “reach” to other organs and limbs and such, too? But within just one surgeon-owned practice?

    And thus the hospitals, naturally enough, don’t want the docs siphoning-off their patients/revenue streams even more?

    • Charlie says:

      That’s a large part of the problem, not just in rural GA but statewide.

      We love to scream “free market” when a new entrant comes to any field that wants to skim off the profitable segment of a regulated industry. We then want to put our hands in our pockets, look the other way, and whistle as we shuffle off when the folks left holding the bag for the unprofitable parts of the regulated industry try to explain they’ve been mandated to take losing patients while being stripped of the profitable ones.

      There’s nothing “free market” about that approach, and given that what the consumer pays and what the provider receives has almost no correlation in health care these days, it’s hard to call anything about it “free market”.

      We have to understand the “real” market the providers operate in before we can make any effort to free it up. And right now, no one is talking realism when it comes to health care.

    • Ellynn says:

      Another proplem with these is how they can set up their billing codes for use by everyday holders of insurance. If you go in for a quick slice and dice as you called it, that’s billed as a normal outpatient service on your insurance. However, you go into them for a follow up, like almost all outpatient services require, instead of a office visit, it is STILL billed out as an outpatient service, since they technically do not have standard ‘offices and exam costs’. Depending on your insurance, that can be the difference between a $25-75 co pay to a $450-800 proceedure cost.

      • Spacey G says:

        Yowzer. Did not know that, this explanation of the financing associated with a slice ‘n dice procedure (and follow up; there are always follow-up appointments) at an outpatient, surgeon-grouped clinic. Not that I believe everything, if anything, I read in the Peach Pundit’s commenteers’ arena. But I’ll run it by a reliable source. See what they say about the matter.

        Thanks for letting me know more, regardless, Ellynn.

        • Ellynn says:

          This one was an orthopedic in east Georgia. My friend’ss insurance agent is looking into it also – to see if this is legal, or if they are commiting fraud. It’s like she is paying for the operation twice.

    • MattMD says:

      Quite honestly, the greed of a large percentage of surgeons really knows no bounds. It is pretty sick some of the crap they pull with these $urgery centers.

      • Teri says:

        Not in Georgia, though. There are plenty of self-insured private employers, like Home Depot, who offer coverage for autism, and several self-insured local governments do as well. SB1, Ava’s Bill, addresses the issue, but bills that are “for the kids!” aren’t faring so well.

        [IMG]http://i15.photobucket.com/albums/a400/rigmort/hudsucker-matted.jpg[/IMG][/URL]

  2. Rick Day says:

    Interesting the accusations that Deal is in bed with GW Pharmaceuticals on this miracle weed creme legislation, and lo and behold, the guv’ner is jetting to Jolly Ole’ this week “on bidness”. May his back door Deal cause him as much suffering as the sick citizens of GA are experiencing while the Legislature plays petty politics with lives.

    Disgusting.

  3. saltycracker says:

    Yep, there is no free market or even one that allows adequate competition. The tea leaves indicate that medical costs will not decline as the turf wars involve limited competition, personal insurance premiums may drop as costs get spread over insured participants, time and govt subsidies.

    Don’t know how the Medicaid doctor cuts will play out, legislative extension, hospitals stuck, doctors stop taking Medicaid patients, extreme waits, fewer participating locations ? don’t know how this effects the 90% level participating states.

    Forbes article:
    Multiple Pay Cuts Hit Doctors In 2015

    The biggest pay decrease will be a return to the old rates paid by the Medicaid program for poor Americans when a two-year pay bump under the Affordable Care Act that increased reimbursement 40 percent or more expires.

    http://www.forbes.com/sites/brucejapsen/2015/01/01/multiple-pay-cuts-hit-doctors-in-2015/

  4. MattMD says:

    People talk about the rural physician shortage and I’ve often wondered what is it really like to pull up stakes and move out into a part of the state that one likely has no ties. I have family scattered throughout the state so it wouldn’t be that hard for me but it is difficult for me to see someone who grew up in metro Atlanta to move out to the hinterlands. Still, would people accept some stranger?

    The few quasi-rural physicians I know are still concentrated around population centers like Vidalia, Waycross and swingin’ Bainbridge.

    • Charlie says:

      OK, let’s walk through this one.

      You’ve just graduated medical school. The world is your oyster. You have $150,000 in student loans. You want to set up a practice.

      Do you: Stay in the Atlanta metro area where hospitals are plentiful, as are patients with quality private insurance that actually pay more than the cost of your services?

      Or, Move to rural Georgia, where according to Misty Williams 3 part report in the AJC, you will lose money on 80% of the patients you see, and need to make 300% of cost to break even on those who have private insurance.

      Bonus points, the state’s largest insurance company is now reimbursing providers at roughly medicaid reimbursement rates – about 83% of cost.

      You need to make 300% of costs on these patients to break even. That’s before you make a profit to buy groceries, a house, a car, amortize that student loan….hell, we can’t even see the country club from this budget, much less join it. And instead, you’re losing money on your “profitable” patients now, in addition to your medicaid, medicare, and your uninsured ones.

      You think the problem is the locals won’t accept them? The locals can’t afford them.

      • Rick Day says:

        Which is why we need socialized medicine. Only we have to call it something else so the few vocal fascists on the right won’t freak out at the concept.

      • MattMD says:

        I wasn’t saying the main problem is that locals wouldn’t accept a new physician; I was just spit-balling on why one may not want to relocate even with incentives.

        Clearly there are huge issues with reimbursements in healthcare delivery which disproportionately impacts rural hospitals and explains why we are bordering on a crises with the closings of rural hospitals. They don’t have the fall back position of adding profitable services to off-set the costs of providing basic health care. Look at how much Gwinnett Medical Center (2000’s) and Athens Regional (1990’s) expanded after they got their CON’s approved to do open heart procedures. They built new towers! MCCG built an entire new 5-story wing. If you take a relative wealthy aging population combined with popular diets you pretty much have a printing press.

        I really don’t have any answers at this point about the rural problem because: 1) I am pretty ignorant about it and 2) Any additional state incentive program would put a serious dent into the budget.

        P.S: I will have to read that article because 300% seems a little high to me.

        • Jon Richards says:

          With all due respect, Matt, your attitude illustrates the problems we have with rural healthcare. First of all, it’s not a simple issue to understand or define, so most people don’t know about the problem. TV can’t do a snazzy 1 minute 30 second news report that defines the problem and gets a talking head enough time to talk about a solution.

          And, any fixes to the problem are going to cause money. Ironically, part of the reason that you can’t make money on healthcare in rural Georgia is that the state has negotiated the lowest rate it could with Blue Cross / Blue Shield for the state health benefits plan. That translates into lower reimbursement rates from BCBS.

          And since many of the state’s rural population receive their healthcare from the state (teachers for one) it seems ironic that the fix is to pass some sort of incentive / reimbursement program to solve the problem. But, if you’re going to put that money in anyway, why not pay more for the insurance program in the first place?

          • MattMD says:

            I think you mis-read what I wrote. I was attempting to say that rural hospitals cannot fall back on profitable procedures, outpatient, etc. Even then we are talking about facility fees, it is not like most hospitals in Georgia have their own staffs, it’s mostly physician P.C.’s. Open-heart was a bad example since you clearly need at least quorum of surgeons who do X amount of procedures a year to maintain some type of consistency and reliability which clearly need to be around larger population centers.

            Incentives have a way of dying out so I don’t think that is a good option. The only thing that is clear to me is that the current model is not sustainable and is bound for collapse sooner than later. I don’t think that patchwork yearly remedies are going to work in the long run, either.

            • Charlie says:

              I think you should have stopped with your first caveats.

              All hospitals (urban/suburan/rural) under CON have profit and loss centers. The ER is a loss center in virtually every hospital because hospitals are required to treat everyone who shows up, regardless of the ability to pay.

              Even rural hospitals have profit centers. …and guess what? Many are reporting that the insurance company(ies) that are reimbursing them at medicaid rates (i.e, losses) are now also mandating they have services such as MRI’s, radiology, etc be done at specialty centers instead of the hospital.

              Now let’s connect the dots on your statement “it’s not like the hospitals have their own staffs…”

              Re-read my above example and put that statement into context. A physician starting a practice, heavy in med school debt, is trying to figure out where he/she can make a living. He won’t see profitable patients in his private practice, and the critical access hospitals in the rural areas also can’t afford to pay him much of anything, and there’s a real question of whether 15-30 of them will still be in business before he gets the invoice from his moving company.

              Now let me throw some extra gas on this fire. Want the state to bail out the hospital? The feds under their model for funding rural hospitals will consider this an “efficiency payment” (their actual term). Know what that does? It has the feds take money back away from the hospital because of the extra local money they found.

              This. System. Is. Broken.

              • The Price plan’s $2k tax credit to buy health insurance will fix it.

                (And by this I mean, there isn’t a credible solution out there being offered that comes anywhere close to Medicaid expansion, which has its flaws).

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