I hope you enjoyed reading this issue of Atlantic General Hospital’s On Call publication. In this issue you read about the various clinical programs that we have added or expanded over the past year. Investing in the expansion of our services to better serve our community and ensure that we are achieving our mission, requires continuous attention from our leadership team, communication with our physicians, and oversight and governance from our Board of Directors. Less noticeable on a day-to-day basis is the effect of legislative decisions and health care choices that individuals make in our community.
This year our state legislators are grappling with crafting regulations to support the federal healthcare legislation that continues to be debated in Washington D.C. and in federal courts. How has the governmental focus on healthcare affected us so far? How does this affect your relationship with the healthcare system and providers?
One of the initial actions taken by the government was the change in qualifications to obtain Medicaid coverage from the state. Medicaid is the state- and federally- provided and tax-supported healthcare insurance plan. In Maryland, the impact of the changes in qualification standards and the increased unemployment levels due to the recession has resulted in an expansion of Maryland Medicaid recipients. The number of recipients has grown from about 520,000 in 2007 to more than 900,000 this year.
This growth in Medicaid recipients has increased the state spending associated with healthcare services. In order to reduce the resulting deficit, the Governor’s office has proposed permanent assessments to hospitals (entitled “Medicaid cuts”) that mandate hospitals return more than $500 million to the state annually. To offset this burden, the state is proposing to add these assessments to the rates that are charged to all payers, insurance companies and individuals. It is fair to predict that this will result in an increase in health plan premiums charged by insurance companies, meaning added costs paid for healthcare services in the state of Maryland for all residents and businesses.
Another rapidly emerging trend in the health insurance market is the sudden growth of high-deductible health plans (HDHP); HDHP’s are those health insurance plans that have a much lower premium and are often offered with associated health savings accounts (HSA). HDHP’s require the initial annual out-of-pocket expenditure of $1,000 or more. This is the fastest growing type of health plan, with 61 percent of employers now offering HDHP’s and 20 percent offering only HDHP’s.
Please be cautious when selecting healthcare plans, because HDHP’s are surprising many individuals when they seek healthcare services. Whether visiting the gynecologist or the emergency room, until that initial deductible is satisfied every year (with some plan exceptions for certain preventive care visits) the total cost is owed from the individual. The plan pays nothing until this deductible is met. This is why it is important to make adequate contributions to an associated HSA, to help plan for these initial annual out of pocket expenditures. Unfortunately, many do not understand this obligation when they sign up for these lower premium health plans, and they are shocked when they receive the total hospital and physician bills for their emergency appendectomy.
These are some of the challenges that our legislators and regulators are struggling with in shaping the system associated with our new federal legislation. They are also the challenges associated with the market response to maintaining our system structure. We will all be facing these challenges together.
We all have important roles to play in this changing environment:
• expressing our concerns and difficult experiences to our legislators to help them understand the impact of their decisions
• understanding our obligations associated with changes in our health insurance plans, planning for them to the extent we can, and understanding the impact of meeting those obligations on our healthcare system; and
• ensuring the availability of services to meet the needs of our community.
Our health system depends on all of us, as we depend upon it. Never before has it meant so much when we’ve said, “It all comes back to you.”
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