Don’t Throw The Baby Out With The Bathwater
Time is critical.
Call Congress today: 866-922-4970
Even if you've called once before, they still need to hear from you! They need to hear from their constituents, and they need to hear what the real impact would be on Tennesseans who rely on these health programs to receive the care they need.
The federal government already is underpaying hospitals less than their costs. In Tennessee, Medicare only pays 90 percent of the cost of providing patient care while Medicaid/TennCare pays 67 percent of the cost of providing patient care.
Hospitals have been forced to become skilled at finding savings and cutting back on costs while maintaining quality, but among the 133 total acute care hospitals in Tennessee, 57 are losing money (total revenue compared with total expenses) while 86 are losing money on patient revenue (patient revenue compared with total expenses).
In 2009, hospitals lost an average of $558 on every TennCare adjusted patient day and $169 on every Medicare adjusted day. Adjusted days are inpatient days adjusted for outpatient utilization to create one measure for all utilization both inpatient and outpatient.
Hospitals already have committed to $155 billion in cuts in Medicare to help fund coverage for the uninsured under the Affordable Care Act (ACA). The ACA’s affect on hospitals’ Medicare margins would be a 15 percent reduction over eight years (see attachment). Tennessee’s portion of the $155 billion is estimated to be over $4.34 billion.
In Tennessee, Medicare patients make up 52.9 percent of total days in acute care hospitals while 16.1 Medicaid patients account for 16.1 percent, for a total of 69 percent, according to the 2009 Joint Annual Report of Hospitals. The uninsured make up another 5.4 percent.
Tennessee’s Medicaid/TennCare program already is a very lean program. It no longer covers a 300,000 expansion population and there is a minimal medically needy group.
In the last two years, Tennessee hospitals agreed to step into the state’s shoes to help fund the TennCare program by asking the General Assembly to pass the hospital coverage assessment. While hospitals will take care of patients as they always have, it is clearly the state’s responsibility to fund TennCare. Hospitals generated $449 million through the assessment, providing a $1.3 billion total contribution to the state’s Medicaid/TennCare program.
In 2009, hospitals in Tennessee employed over 98,000 people and had a total direct income impact in the state of $5 billion. The hospitals’ spending for supplies and services, as well as hospital employee family members working and earning salaries in the community, resulted in a total hospital impact of 203,999 employees and a total income impact of $8.7 billion. The total healthcare sector in Tennessee employed almost 331,000 persons and generated $16.4 billion in income. With the addition of their business to business and family activity, the healthcare sector resulted in 640,511 jobs and a total income impact of over $26 billion in Tennessee.
From the Perspective of a Teaching Hospital
