Homelessness and hospitals

Although we fully agree with Steve Kirby’s points about health insurance and the threat of bankruptcy of urban hospitals, our concern is that the failure to end homelessness is a major contributor to this problem. The failure to end homelessness is an enormous financial drain that not only undermines hospitals but also other public and private organizations. Thus, the goal should be universal health care and an end to homelessness.

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A hospital system in the emergency room

The Star-Ledger, Tuesday, February 27, 2007

BY STEVE KIRBY

Overcrowded emergency rooms, a serious problem for any urban hospital, are only a painful symptom of a much deeper pathology that threatens all emergency facilities. In the end, those problems threaten the very financial survival of many hospitals that provide care to those who most need it.

Emergency rooms often provide the primary care that people who cannot afford to pay medical bills desperately need. They even provide a place to come in out of the weather for some or social services for others. The homeless, people in need of mental health services, and many non-emergency cases come to us because there simply is no other place to go. We are morally and legally required to treat everyone. We provide that care every day. Everyone who appears at our emergency room receives excellent medical care. Those without private insurance, nearly three of four of our patients, are treated exactly like everyone else. Every day, we average 250 patients over our peak eight-hour period.

You can be assured that we do our very best to make sure that testing, scheduling of procedures and admission and discharge of patients are as efficient as any human enterprise can be. That may help some, but it will not solve the basic problems.

Reimbursement, either through Medicaid or through state charity care, covers nowhere near the cost we incur. Regulations freeze payments for indigent patients at 2002 levels. Any increase in indigent patients since then is not reimbursed. Thus we experience a double whammy: We are overwhelmed with patients and we lose money on almost all of them. This, more than any other factor, is the reason virtually every urban hospital is in deep financial trouble.

We hope the state government will be able to help us by treating all residents fairly, reimbursing hospitals for money already spent on treating the less affluent sick and injured. We have some hope for short-term help. The states, with New Jersey sometimes in the forefront, are working to fix America’s broken health care system. But at the same time, President Bush’s budget features cutbacks and freezes in the federal Medicare and Medicaid programs, making our problems even worse.

The Temple University Health System in Philadelphia has just announced that it will be cutting 500 jobs in its four-hospital system, one that serves the city’s poorest neighborhoods. The cost of care is rising as Medicaid payments to treat nearly half of its patients decline. Temple is cutting out obstetrics at one of its hospitals, making it the 11th Philadelphia area hospital to stop delivering babies in the last decade. Last year, the Temple hospitals provided $118 million in care for free or well below cost.

We know how they feel. These days, the safety net is so frayed that the very hospitals that provide it are in constant danger of going broke. Where will the people who need us go then?

The sad fact is that hardly anybody can make money in medical care except for insurance companies and firms in the drug and medical device business. The insurance companies make their money, denying coverage whenever they can and cherry-picking the people they choose to insure.

Paul Krugman , the Princeton University economist who writes in the New York Times, cites a study by the McKinsey and Co . consulting firm that estimates that $98 billion a year is used up in excess administrative costs, more than half of it in either marketing or in the money spent on finding ways to say no to doctors, hospitals and patients. The same study estimates that another $66 billion goes for the additional profit the American system provides drug companies over what they make in other countries.

The study estimates, Krugman writes, that the cost of insuring every uninsured American would be $77 billion a year.

We can fix everything around the edges. We can make our hospitals run as efficiently as a Japanese automobile company. We can spend every dollar as if it were our last. And we will still go under if nobody looks at the most threatened part of our collapsing health system, the urban hospitals whose payer mix guarantees that they will lose money.

As long as the people who provide care have to bear the brunt of need while others stand by and criticize us while taking their profits out of our work, not much is going to get better.

Steve Kirby is acting president of the Jersey City Medical Center.

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