Hospital hurt by healthcare reform

The debate on whether the Affordable Care Act is a success or not will most likely continue for years.
February 6, 2014 8:41:07 PM PST
The debate on whether the Affordable Care Act is a success or not will most likely continue for years. But officials at St. Rose Hospital in Hayward say, because of the ACA and other federal and state cuts, it might not be around to see the unintentional side effect of healthcare reform.

St. Rose Hospital has had money troubles for years. In fact, it has almost closed a few times before. Its patients are mostly uninsured or under-insured. The new management team is making headway to keep the hospital open but the reductions in federal and state money might mean those doors shut for good.

For patients like Ginny Almond, St. Rose Hospital's location in Hayward is everything. She was recently rushed there for emergency surgery. She says a few years ago St. Rose doctor's saved her life after she almost died in a fire.

"Very grateful that they were there and so close to where I live," Almond says.

The private, non-profit hospital sees almost 35,000 emergency room patients a year. With Kaiser Hayward closing, St. Rose will be the only facility receiving 9-1-1 patients in the Bay Area's fifth largest city.

Now, because of money trouble, St. Rose might have to shut down.

"It'd be tragic for myself and for the neighborhood," according to Almond

St. Rose's Chief Financial Officer, Roger Krissman, points out, "If St. Rose is no longer existing that means lives are at stake because ambulance have to travel a little bit further ways to another facility."

He says, as a safety net hospital, St. Rose sees large numbers of uninsured and under-insured patients.

The fees those patients can't pay have been subsidized by federal and state programs, such as, Medicare and MediCal.

The Affordable Care Act will reduce Medicare subsidies by $22 billion over the next five years.

The idea is that more people will be insured and able to afford health care.

But Krissman argues his hospital still needs that money because St. Rose serves a poor community, many of whom might not sign up for insurance.

"We will receive $3.6 million less in reimbursement of, for the next 12 months," according to Krissman.

Add that to the $10,000 deficit Krissman says St. Rose racks up every day, in part because MediCal doesn't cover full service costs.

"Under the MediCal program we are reimbursed approximately 13 cents on the dollar," Krissman points out.

According to Steve Rousso, "The State and the feds are basically doing what's good for them without realizing how much they're hurting these individual community hospitals. Like a St. Rose."

Rousso is a healthcare industry consultant.

He says the cuts will hurt more because St. Rose is not affiliated with a larger group, such as, Kaiser, Sutter or even a county.

"It's very hard to off-shoot this because they're not part of a system. They don't have the purchasing power of a large system," says Rousso.

The ABC7 I-Team wanted to talk to state and federal officials about this unintended consequence of the affordable care act, possibly shutting down hospitals such as St. Rose that have already been experiencing problems, but they either passed us on to someone else or declined to be interviewed.

The California Department of Health Care Services did send an email that reads in part, "We value the services provided by our provider partners like St. Rose, and we are committed to ensure access to services for our MediCal members."

Alameda County is another part of the equation for St. Rose.

"St. Rose has said to us at the County for years, like, you got to do more, you got to do more. Where from my perspective the county's support for St. Rose has been significant," according to Alex Briscoe, director of Alameda County Health Care Services.

Briscoe points out taxpayers have supported St. Rose to the tune of the $40 million over the last five years. He says that amount was appropriate because of the important role St. Rose plays in the Alameda County.

"St. Rose not only faces the challenge of not getting enough money but they also face the challenge of serving a community that is increasingly living in multi-generation poverty," Briscoe says.

In a letter to Alameda County Supervisor Wilma Chan, St. Rose is asking for $18.3 million annually to help cover the $3.6 million in reimbursement changes and other funding needs.

Briscoe says $18.3 million isn't realistic.

"I think an augmentation of somewhere between $4 and $6 million is probably the right level of support and we've been providing that level of support in one-time funds , in special waiver programs, frankly by hook or by crook," according to Briscoe.

Krissman says, "I think the Supervisors of Alameda County are uh, are very fair individuals and I'm certain they will do everything in their power to help St. Rose Hospital."

Ginny Almond hopes that solution comes soon and St. Rose doesn't have to close.

"Well, they've saved my life. I might want them to do it again," Almond says.

The health care reform reductions are not one-time cuts. Each year hospitals, such as St. Rose, will get less federal and state dollars. So, there needs to be a long term solution worked out if St. Rose is going to survive.


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