Keeping in touch

In preparation for the upcoming legislative session, I have recently attended two meetings regarding health care challenges and the impacts the New Health Care Reform Laws are having on Montana.  While the Patient Protection and Affordable Care Act (PPACA) and the Health Care and Education Reconciliation Act of 2010 (HCERA) – commonly known as Obamacare - are undergoing legal challenges as to its constitutionality as well as individual states’ efforts to opt out of the federal legislation, such as The Freedom of Choice Act Constitutional amendment, these legal challenges and states actions have not deterred the implementation of some of the legislated changes which are, at the least, introducing new challenges for medical and insurance providers.

The specific timing of the implementation of the new health care reform laws is confusing to say the least.  The starting points are the enactment dates of the laws, both of which were in late March 2010.  The PPACA enactment date was March 23, 2010 while the HCERA enactment date was March 30, 2010.  These dates are important because these are the starting points from which various provisions will be implemented.

Even without the new health care reform being ushered in, it is a challenging time for health care providers as the recession has affected revenue and costs.  Charity care and bad debts are up and patients are putting off procedures so utilization of medical resources and facilities are down.  The outlook for future revenue is uncertain and with shortages in the workforce, especially those shortages in primary care providers, physicians, nurses and professional staff, a pressing concern arises, will future medical needs of the state’s growing senior population be met?

One concern which came up during the Montana Health Care Providers meeting I attended was that under the health care reform law hospital payments were being cut.  The health care law projects to reduce hospital Medicare payments by $143 million over 10 years; the first reduction came last July.  Additional reductions are planned for Medicaid payments.  Revenue from mandated insurance coverage is projected to make up for these Medicare and Medicaid cuts, but there is no guarantee that this outcome will be achieved.  In addition to health reform cuts, the FY 2011 Medicare inpatient payment formula reduced payments -0.4 percent for inpatient services.  Potential Medicaid cuts would widen the payment-to-cost gap even more, but only time will tell.

Medicaid plays a primary role in many of the State’s Public Health and Human Services programs.  Medicaid is a federal-state partnership.  Eligibility and other rules are set by the state within federal guidelines.  The state then sets provider rates which are found in House Bill 2.  Beneficiaries of Medicaid dollars include low-income families, disabled persons and the elderly.  For every 33 cents spent by the state on Medicaid, the federal government adds 67 cents.  However, as the federal government reduces its contributions, it will fall upon the state to make up the difference if it has the resources to do so.

While our medical providers are facing new Medicaid challenges which impact them significantly, they also are facing the additional reality of what will happen to Medicaid payments during the upcoming 2011 legislative session.  During the 2009 legislative session, appropriation levels were increased for nursing home payments, hospital payments and medical physician payments.  However, those increases were funded by one-time-only dollars (stimulus dollars) which no longer exist, creating more funding challenges for the upcoming legislative session to face.

Then there are the challenges to the health insurance carriers who are trying to implement the changes which are being required.  Changes such as the elimination of lifetime policy limits, the reinsurance for retiree health benefit plans, you cannot be dropped provisions and children allowed to stay on their parents’ health care plan until age 26, to name just a few.  These are changes which will affect everyone in the near future.

As we turn the next corner and are faced with medical, economical, financial or political challenges, remember we are a resilient lot and we will get through these difficult and challenging times.

Now it is your turn to “Keep in Touch” by contacting me regarding your questions or concerns. I can be reached via e-mail at pathd13@blackfoot.net or call me at 827-4652 or by mail at P.O. Box 1151, Thompson Falls, Montana 59873.