The Joplin Globe, Joplin, MO

Opinion

Discussion

June 30, 2012

Paula Baker, guest columnist: Federal cuts will chip away at hospitals

By Paula Baker The Joplin Globe

As I spoke to several reporters this week seeking reaction to the Supreme Court’s announcement to uphold the majority of the Affordable Care Act, I tried to ensure that one message rang loud and clear: Access to quality health care is not a privilege. It is a right.

And I believe the best health care in the world can be found in our 50 states — we utilize the best technology and treatment man has ever known. But for those who are uninsured, access to such care has often been out of reach.

As I told several members of the media, the Supreme Court’s decision to uphold the majority of the Affordable Care Act will change the lives of so many Americans.

No longer will they have to put off seeking treatment because they have no insurance. They can now receive the care they so desperately need — the care they have a right to receive.  

In this regard, the future of health care in America is bright.

As we consider other elements of our future, though, we are left with cause for concern. Stability and predictability in funding are essential elements to the success of every hospital in this great nation. Right now, those two elements are lacking.

The considerable turmoil over health policy in Washington, D.C., has hampered hospitals’ ability to maneuver through the very landscape in which we operate.

Throughout the next 10 years, Medicare payments to Missouri hospitals will decrease by $5.1 billion because, in part, of the Affordable Care Act and other payment reductions enacted by Congress.

Cumulatively, these cuts represent a 12 percent decrease in Medicare payments. Nearly every Missouri hospital receives at least half of its revenue from federal or state programs, including Medicare, Medicaid and TriCare. For Freeman Health System, this amounts to 60 percent of our revenue. These cuts will eventually chip away at hospitals’ financial integrity, reducing their ability to care for the communities they serve.

In the past, Missouri has had a safety net of sorts shielding us from the brunt of some cuts. A significant portion of our state’s health care is funded through a provider tax program. The federal government, however, has now proposed limits to the use of provider taxes to fund Medicaid. Such a move would reduce the provider tax rate from 6 percent of health care revenue to 3.5 percent between 2015 and 2021, resulting in the loss of more than $5.5 billion in federal funding throughout that seven-year period. The consequences of that reduction would be catastrophic for Missouri’s Medicaid program.

In November 2011, Missouri Hospital Association and the Taxpayer Research Institute of Missouri commissioned a study from the University of Missouri on the economic impact of such a reduction. The researchers concluded that cuts of that magnitude would lead to a significant loss of Medicaid resources, shifting of costs to private payers, and elimination of jobs in the health care sector.

Hospitals are being asked to do more — improve quality, safety and efficiency — with fewer resources. Freeman has always met those challenges and will continue to do so. We will follow our tradition of providing exceptional services and the highest quality of care to our patients.

By controlling costs, Freeman will continue to make investments that enhance the physical and economic health of our communities. But better stability and predictability for funding in our state would improve the future’s outlook — not only for Freeman but for the health of this entire community.



Paula Baker is president and chief executive officer of Freeman Health System.

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