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Let’s not forget patients amid health care change

As anticipated, the current rate-setting system for inpatient hospital bills is being allowed to sunset by the state Legislature, albeit effective Jan. 1, 1997, instead of June 30 of this year as originally planned. This brief delay will allow both the hospitals and payers the time necessary to negotiate new rates.
While rates for the privately insured thus will be up for grabs, rates for both Medicare and Medicaid, which combined form more than half of most hospitals’ inpatient revenues, will continue to be set by the government. While those rates may be cut due to governmental budgetary pressures, they will be a stabilizing factor for hospital revenues, and they will no doubt stiffen the hospitals’ resolve to resist significant reductions in their negotiated rates.
What the payers have going for them in the coming rate negotiations is a sudden steep decline in both hospital length of stay and rates of admission. Combined, those drops in utilization have reduced local hospital occupancy from nearly 90 percent to just over 70 percent in the last two years. That vacancy rate will provide the payers with a credible threat either to direct all inpatient business away from a high-cost hospital, or to pay a rate no greater than that of the lowest-cost facility.
When all the hospitals were more nearly full, such threats to redirect patients were quickly seen as impossible to carry out because the excess capacity within which to do so was not available.
While all this economic jockeying is going on, what will happen to the patients? As hospital services are consolidated, such as is proposed by St. Mary’s and Park Ridge hospitals, will patient access to services decline, or will their interests get lost?
Part of the answer, at least for the majority of patients locally who are in HMO plans, may be in the protections which will go into place starting next year under other new state legislation. In particular, patients will have newly expanded rights to appeal HMO decisions denying coverage for particular courses of treatment.
Those protections, however, will only benefit those who have HMO coverage. Those who are uninsured, or who have difficulties accessing health care because of transportation or language barriers, will not be helped by this bill. As we improve the rights of those who are insured and can access the system, and as we focus more on the quality and outcomes of the care given in our health system, we need also to pay attention to those who are not in the system to begin with.
Particularly for smaller businesses, whose employees are most likely to be uninsured, this is just good business. The disruption and loss of productivity from absence due to illness or just from impaired health is a significant cost. And the impact on the business when a worker is out is likely to be greater in a smaller workplace than in a larger enterprise where temporarily covering that worker’s duties may better be accommodated.
Thus, as part of our local health care agenda, we should be putting in place a mechanism to routinely monitor measures that might indicate developing problems of health care access. For example, absenteeism due to illness could be monitored, not just in the aggregate, but with some more fine-tuned measures that look at certain factors’ influence. For instance, does the employee have health insurance, what is his or her wage, and in what area does he or she reside?
For those who are not employed, we could be watchful for increases in the rates of hospitalization for diseases such as pneumonia, which usually do not require inpatient care if there is adequate primary-care access.
Part of the success story behind Rochester’s health care system can be attributed to our having invested in data about how our system is used; this provides the basis for our decisions instead of just having the system develop without any community oversight. This has been the case for decades. For example, I have in my office a copy of a 1938 study of our hospitals.
While our community focus recently has been on issues of capital investment in our health care facilities–as oversight of some of those projects is deregulated by the state–we should not abandon our first principles as a community. We should collect and objectively analyze whatever measures are important at this time in our history. The changes currently under way in our health care system suggest it is time to pay more attention to issues of access to care than we have in the past.
(Rene Reixach is executive director of the Finger Lakes Health Systems Agency.)


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