Facing a political firing squad, Anthem Blue Cross executives have not been shy to place blame on hospitals for driving their infamous 39 percent rate hike.
And as I wrote earlier this week, a famed economist and recent report in Health Affairs echo that point.
But there’s more to the story, California Hospital Association Vice President Jan Emerson told me in an interview yesterday.
“The health plans are under attack so they’re shifting the blame,” Emerson said. “Our position is, let’s look at the underlying reasons.”
Hospitals are treating a flood of uninsured patients who, under federal law, they cannot turn away from their emergency rooms. Emerson noted that last year’s bill for treating uninsured patients was up to $12.2 billion – that’s nearly a 50 percent increase over the 2005 total, about $8.3 billion.
Nationwide, public hospitals saw a 23 percent increase in uninsured patients, at an added cost of about $2.3 million per hospital. Those costs – as well as costs hospitals carry when Medicaid routinely shortchanges them – get passed on to health insurers and have for years.
Emerson also takes exception to the Health Affairs argument that hospitals are gaining significant clout at the negotiating table with insurers. She said the number of insurers in the state has fallen from 23 in 1990 to a big five now. Banding together is all hospitals can do to get a fair negotiation, she said.
Hospitals are also facing legislatively imposed deadlines for seismic safety without any state funding to retrofit buildings. And Emerson notes that paying health professionals’ salaries also strain hospitals.
The American Hospital Association, the national version of the group Emerson represents, recently fired a letter off to WellPoint (Anthem's parent company) CEO Angela Braly, pushing back at their argument that hospitals are driving cost increases. The letter is polite, but makes one particularly pointed statement: While hospitals are seeing the same pressures as insurers, they're still serving patients at a diminished profit.
"Despite sinking margins, America’s hospitals continue to act as the safety net for the health needs of their patients and communities while WellPoint and many other large insurers enjoy significantly higher margins," AHA President Rich Umbdenstock wrote.
For all the disagreement between insurers and hospitals on what’s propelling health costs into the stratosphere, the letter makes clear reference to the goal both seek: health reform that leads to lower costs, better quality and more coverage for more people.
Comments
via Twitter