Thursday, Jul. 31, 2008

Hospitals become latest victims of state budget deadlock

By CAROL REITER
creiter@mercedsun-star.com

With the state budget at a standstill, hospitals are joining the ranks of people and businesses hurt by the deadlock.

The state has informed California hospitals that no further Medi-Cal payments will be sent to hospitals until a state budget is enacted. That means the bottom line of hospitals that take care of a large number of Medi-Cal patients, such as Mercy Medical Center Merced, could take a hit.

David Dunham, president of the hospital, said the emergency room is going to be affected along with clinics.

"We will continue to provide services whether we get paid or not," Dunham said, adding that because federal laws mandate that hospitals must treat anyone who comes in, hospitals are put into a unique situation. "We have to take care of everyone," he said. "We can't turn people away."

California has been without a budget since July 1, and Gov. Arnold Schwarzenegger has chosen to cut Medi-Cal payments along with education dollars.

There is now a freeze on Medi-Cal payments to providers, and Dunham said that freeze, coupled with delays in the processing and collection of money for services already rendered, will hit hard.

"It's not fair to lay the burden on hospitals," Dunham said. "We have to keep providing the services, no matter what."

Dunham said if a person goes into a grocery store and tries to walk out carrying a bag of groceries without paying, that's against the law. But hospitals can't turn people away, regardless of whether they're compensated for their services. "We just have to keep seeing people, whether we get paid or not," Dunham said.

Jan Emerson, spokeswoman for the California Hospital Association, said Medi-Cal payments provide up to 60 percent of some hospitals' revenue. Dunham didn't know how many Medi-Cal patients the hospital sees a year, or how much revenue Medi-Cal brings in.

California reimburses hospitals and health providers at the lowest rate of all the states. Emerson said the program has been underfunded for years. "Right now, a hospital loses about 22 cents on every dollar of care to a Medi-Cal patient," Emerson said.

The hospital association has delivered signatures to Sacramento and is working with legislators to get the Medi-Cal payments reinstated.

The reason that Medi-Cal is the subject of the cutbacks is easy to understand, according to Emerson. "Next to education, the state health system is the second-largest component of the state budget," she said.

But cutting back on Medi-Cal doesn't just affect poor people who have no other insurance. Emerson said it will also affect anyone who wants to get care at a hospital. "If providers stop seeing patients, and those patients end up in the emergency room, that means wait times for everyone will be even longer," Emerson said.

At Mercy, emergency department visits have gone up for the past two years, but inpatients haven't stayed with the average. Emergency room visits went from 44,000 a year in 2006 to 49,000 this year. Inpatient visits stayed about the same.

That means that the people who visited the emergency rooms could have probably been treated by a clinic or a primary care doctor. "I hope that our elected officials can reach a resolution to this and the health care industry isn't saddled with bearing the entire mess," Dunham said.

Emerson said legislators are looking at numbers only when trying to balance the budget. "Unfortunately," she said, "cutting Medi-Cal affects real people -- not just numbers."

Reporter Carol Reiter can be reached at (209) 385-2486 or creiter@mercedsun-star.com.