Stanley Feld M.D., FACP,MACE

Safety net hospitals have played a vital role in the care of America’s indigent population for over one hundred years.

Over the past few years’ safety net hospitals throughout the country have gone out of business. Fifteen percent of the hospitals in the United States are publically owned safety net hospitals. These are city or county hospitals.   

“The urban public hospitals are often associated with medical schools.^[7] The largest public hospital system in America is the New York City Health and Hospitals Corporation, which is associated with the New York University School of Medicine.”

These hospitals receive funding from local, state, and federal government. They are also allowed to charge Medicaid, Medicare, and private insurers for the care of patients that have these forms of insurance.

Poor uninsured patients receive their care free from safety net hospitals.

Public hospitals, especially in urban areas, have a high concentration of uncompensated care. Their association with medical schools as teaching hospitals is an additional funding source provided by the federal government.

“The federal government provides funding to hospitals that treat indigent patients through the Disproportionate Share Hospital (DSH) payments.”

 About 2,000 hospitals receive this funding. The problem is these DSH payments are highly concentrated.

Sixty-three percent of total DSH payments go to large teaching hospitals in urban areas.

DSH funding method is political and bureaucratic. Payments are manipulated.  Medicaid eligibility and coverage vary widely across states and change the distribution of funds.

DSH payments have been distributed unevenly across geographic areas and away from rural safety net hospitals.

The uneven distribution is toward large urban safety net hospitals in the Middle Atlantic, South Atlantic, and Pacific regions. Those hospitals account for 60 percent of all DSH payments but only account for 46 percent of Medicare discharges.^[2]

The result is public safety net hospitals in America are closing at a much faster rate than hospitals overall.

“ The number of public hospitals in major suburbs declined 27% (134 to 98) from 1996 to 2002.”

As the number of uninsured and indigent patients has increased, their expenses in providing uncompensated care have drained the suburban and rural public hospitals funds.

Treating patients without receiving compensation has also drained urban non teaching hospitals.

Public and non-profit rural hospitals form a large part of the health care safety net for the indigent and uninsured in the U.S.^[9]

 Several large safety net hospitals have gone into bankruptcy because cities and states could not afford to fund them.

Two prominent examples are Martin Luther King in Los Angeles and Grady Memorial in Atlanta. Grady Memorial in Atlanta has gone into bankruptcy twice only to be rescued the citizens of the city of Atlanta.

 Non-profit community hospitals can collect federal funds if they treated a certain percentage of indigent and Medicaid patients.

In order to reach that percentage the federal government has allowed community hospitals to eliminate certain beds from its total hospital bed count. The hospitals can eliminate outpatient observation beds, skilled nursing swing beds and ancillary labor/delivery services beds from its total bed count.

It inflates the percentage of charity beds a non-profit hospital counts toward government subsidy. This is a totally political maneuver.

In effect it decreases federal funding to city and county safety net hospitals.

In October 2012, Obamacare is starting to adjust federal hospital payments based on quality of care. One of the primary metrics will be patient experience rating that covers everything from the communication skills of doctors and nurses to their promptness in responding to complaints about pain.

A new study in the Archives of Internal Medicine finds that this change may add to the financial troubles of safety net hospitals, which primarily serve poor patients. The safety net hospitals tend to get poorer marks from patients than do other hospitals.

“On average, they drew top ratings from 63.9 percent of patients while the hospitals that treated the fewest poor people got top ratings from 69.5 percent of patients.”

The gap has gotten widen over time. It means that the non-profit hospital will get a larger share of the federal money than the safety net hospitals.

I have written several articles on how the federal government has been destroying these safety net hospitals throughout the country.

In the first year of the Hospital Value-Based Purchasing program that starts this October, patient experience scores will determine 30 percent of the bonus.

The rest of the bonus will be determined by how hospitals adhere to basic guidelines for clinically recommended care.

The hospitals that perform best will receive a higher bonus. Those that lag in their scores will end up with less.

 Many safety net hospitals do not have the funds to buy adequate information technology to record the required treatment protocols.

It means that non-profit hospitals will receive additional bonus money and safety net hospitals will be penalized.

To add insult to injury the vital safety net hospitals’ decrease in federal funds could push them  “closer to bankruptcy.”

President Obama’s program will make it even worse for safety net hospitals in October 2013.

Obamacare will start reducing special payments to hospitals that treat disproportionately large numbers of indigent patients. Safety net hospitals are the hospital treating a disproportionately larger number of indigent patients.

Without this funding the safety net hospitals cannot improve quality or provide services to indigent people.

The questions to ask are,

• Are the measurement used to determine quality care wrong?
• Is President Obama trying to destroy the safety net hospital system on purpose?
• Does he not realize that many indigent Americans depend on safety net hospitals?

What is going on here?

The opinions expressed in the blog “Repairing The Healthcare System” are, mine and mine alone. 

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Stanley Feld M.D.,FACP,MACE

U.S. Congressman Paul Ryan gave a speech in January 2010 at Hillsdale College's Allan P. Kirby, Jr. Center for Constitutional Studies and Citizenship defining the role of government in a free society with particular reference to healthcare.

Paul Ryan understands the constitution and uses a lot of common sense.

Mr. Ryan traces the history of the progressive movement of the Democratic Party in America.

“The social and political programs of the Democratic Party’s progressive movement came in on two great waves: the New Deal of the 1930s and the Great Society of the 1960s”.

“Today, President Obama often invokes progressivism and hopes to generate its third great wave of public policy.”

 This desire by President Obama leads him to believe he will be judged as one of the greatest Presidents in American history.

President Obama believes his ideology will save the healthcare system, the financial system, and the country.

There is no question the healthcare system needs to be reformed. It has become unaffordable and inaccessible to people who need healthcare insurance coverage.

The need for reform leads Dr. Don Berwick former Director of CMS to conclude that by definition effective healthcare system means the redistribution of wealth.

The debate in healthcare is not whether we need healthcare reform but what form that reform should take.

“Under the terms of our Constitution, every individual has a right to care for their health, just as they have a right to eat.”

“These rights are integral to our natural right to life. It is the government's chief purpose to secure our natural rights.”

 But the right to care for one's health does not imply that government must provide health care, any more than our right to eat, in order to live, requires government to own the farms and raise the crops.

The government's chief purpose is to secure our natural rights. It is a critical sentence defining the role of government by our constitution.

It is not the role of government to provide healthcare any more than it is our right that the government feed us. It is the individual’s responsibility to do both. 

It is the government’s obligation to protect our rights. The government’s obligation is to establish free market conditions so providers and vendors cannot take advantage of us and abuse our rights. We should not be entitled to food or healthcare.

Paul Ryan goes on to say,

“ With good reason, the Constitution left the administration of public health—like that of most public goods—decentralized.

 If there is any doubt that control of health care services should not have been placed in the federal government, we need only look at the history of Medicare and Medicaid—a history in which fraud has proliferated despite all efforts to stop it and failure to control costs has become a national nightmare.”

All the stakeholders are experiencing this nightmare after 47 years of the government making adjustments to the Medicare and Medicare rules.

No one predicted the adjustments made by both the government and the stakeholders would result in unsustainable costs for the government, private sectors and the people.    

This national nightmare is going to expand with the passage of Obamacare, the funding of the multiple agencies formed and the proposed 32 million more uninsured people to be added to Medicaid along with the increasing number of baby boomer going on Medicare.

Democrats, Republicans and Independents believe in fairness to all. Americans are very charitable people and are frequently mobilized to help the needy.

However, President Obama has tried to appeal to our sympathy for him by painting a contrast between himself and his opponents.  He is trying to persuade us that he is the good guy and the rest are bad guys.

“If you believe this economy grows best when everybody gets a fair shot and everybody does their fair share and everybody plays by the same set of rules, then I ask you to stand with me for a second term as president.” 

On closer examination his actions have gotten us deeper into our fiscal dilemma. He has not leveled the playing field; he has wasted money and increased our deficit.  The U.S. is at the point where it cannot borrow itself out of its jam.

If the U.S. continues to try to print (money) itself out of the jam the economy will implode.

President Obama’s ideology has created uncertainty and decreased the private sector willingness to create jobs and stimulate the economy. He has not created enough jobs with his massive stimulus packages.

A reader wrote,

We ran out of money a long time ago.  Every dollar we spend is 40% borrowed money and healthcare in our country is comprised of 50% taxpayer money.  What else do we need to see in terms of the math to believe we are on an unsustainable path?

Paul Ryan argues,

“President Obama urges us today—out of compassion—to support the progressive model; but placing control of health care in the hands of government bureaucrats is not compassionate."

Bureaucrats don't make decisions about health care according to personal need or preference; they ration resources according to a dollar-driven social calculus.

 Dr. Ezekiel Emanuel, one of the administration's point people on health care, advocates what he calls a “whole life system”—a system in which government makes treatment decisions for individuals using a statistical formula based on average life expectancy and “social usefulness.”

“ In keeping with this, the plans that recently emerged from Congress have a Medicare board of unelected specialists whose job it would be to determine the program's treatment protocols as a method of limiting costs.”  (USPTF and IPAB)

I believe there are very few Americans who would be satisfied with this kind of halthcare system once they understand what is happening.  

Ryan goes on to say:

"The good news is that we have a choice.

 There are three basic models for health care delivery that are available to us:

 (1) Today's business-government partnership or “crony capitalism” model, in which bureaucratized insurance companies monopolize the field in most states."

Medicare and Medicaid’s administrative services are outsourced to the healthcare insurance industry by the government. The healthcare insurance companies charge the government 40% of the Medicare and Medicaid healthcare dollars for overhead.

President Obama claims that the medical loss ratio will limit the overhead to 20% and 80% will go to direct medical care. Wrong!

 The overhead is disguised in direct medical care costs.

How do you think top healthcare insurance executives can receive many millions of dollars in compensation each year?

 "(2) The progressive model promoted by the Obama administration and congressional leaders, in which federal bureaucrats tell us which services they will allow."

We have seen over and over again unintended consequences, excessive waste created by cumbersome rules and regulations, and stakeholders adjustment to take advantage of the rules and regulations, all of which lead to intolerable costs, taxes and the erosion of the value of the dollar. Obamacare is going to result in greater administrative waste plus rationing of care.   

" (3) The model consistent with our Constitution, in which health care providers compete in a free and transparent market, and in which individual consumers are in control."

 The government's chief purpose is to secure our natural rights by leveling the playing field for all the stakeholders and enforcing the rules. It is essential that the rules are transparent and simple.

The patients must be empowered to be responsible for their healthcare dollars and their health. Entitlements do not promote personal responsibility

One of Paul Ryan’s concluding points is,

“The answer is that the current health care debate is not really about how we can most effectively bring down costs.”

 It is a debate less about policy than about ideology. It is a debate over whether we should reform health care in a way compatible with our Constitution and our free society, or whether we should abandon our free market economic model for a full-fledged European-style social welfare state.

 This, I believe, is the true goal of those promoting government-run health care."

My Ideal Medical Saving Account can be an extremely democratic and fair model. By changing a couple of existing healthcare insurance rules the administration would create a truly free competitive free market for healthcare consumption.

The government should also educate patients to assess the value of the medical care they freely choose. It should be the consumer’s decision, not the government’s decision.

These actions would reduce the cost of healthcare and create a sustainable healthcare system.

The opinions expressed in the blog “Repairing The Healthcare System” are, mine and mine alone

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Stanley Feld M.D.,FACP,MACE

It is unlikely that President Obama can intimidate the Supreme Court.

The Supreme Court is going to judge “Obamacare” on the basis of its constitutionally.

Two weeks ago President Obama tried to intimidate the Supreme Court.

“With a rhetorical back of the hand, President Obama seemingly attempted to browbeat Supreme Court justices into rescuing his increasingly imperiled signature legislative accomplishment – Obamacare. The president proclaimed that it would be "unprecedented" and "extraordinary" for the Supreme Court to overturn "a law that was passed by a strong majority of a democratically elected Congress." To add insult to self-inflicted injury, the president suggested that "judicial activism" would be an appropriate label if the Supreme Court were to "somehow overturn a duly constituted and passed law."

The president is wrong on the facts and wrong on the law. As we all know, the law was not passed by "a strong majority" of Congress. It won House passage by a razor-thin seven votes and even more narrowly escaped filibuster in the Senate. Even that close margin was sullied by vote-buying allegations such as the Cornhusker Kickback. The law turns out to be even more unpopular with the American people.”

I was horrified at President Obama’s attempt at intimidation. The public backlash he received compelled him to backpedal. He tried to explain what he meant the next day. He was unsuccessful.

He should understand “as a constitutional lawyer” the Supreme Court’s job is to decide if a law is constitutional. 

On May 3,2012 President Obama tried another route to influence the Supreme Court’s potential decision on his healthcare reform act. 

“In papers filed with the Supreme Court, administration lawyers have warned of “extraordinary disruption” if Medicare is forced to unwind countless transactions that are based on payment changes required by more than 20 separate sections of the Affordable Care Act.”

The administration counters that even if the Supreme Court strikes down the insurance mandate, the court should preserve most of the rest of the legislation. That would leave in place the administration’s changes to Medicare as well as a major expansion of Medicaid coverage.

“Justice Department lawyers said reversing the Medicare payment changes “would impose staggering administrative burdens” on the government and “could cause major delays and errors” in claims payment.”

President Obama rolled out Dr. Donald Berwick, former non-congressional confirmed head of CMS, to inform the public of the devastating affects repealing the law would have on seniors.

“Tossing out President Barack Obama’s health care law would have major unintended consequences for Medicare’s payment systems.

“Medicare cannot turn on a dime,” said former administrator Don Berwick, Obama’s first Medicare chief. “I would not be surprised if there are delays and problems with payment flow. Medicare has dealt with sudden changes in payment before, but it is not easy.”

AARP is also helping President Obama with his dirty work. It should not be forgotten that AARP took $4 billion dollars from UnitedHealthcare to be it exclusive vendor for Medicare Part D and Medicare Advantage.

 AARP says it’s concerned. If doctors became embroiled in a legal battle over payments, then “a general concern would be that physicians would cease to take on new Medicare patients, as well as potentially have issues seeing their current patients,” said Ariel Gonzalez, top health care lobbyist for the organization.

President Obama was smart enough not to personally frighten seniors. If the Supreme Court’s decision goes against him and hardships are created for seniors because of the disruptions to Medicare he can point to the Supreme Court as being a political activist court. He can say the Supreme Court has thwarted his agenda and has harmed seniors.

He can claim he is the defender of seniors. His hope is this maneuver will help in his reelection campaign.

The Supreme Court is the interpreter of the Constitution. It is not the defender of President Obama’s ideology. The Supreme Court’s integrity should not be attacked before or after a decision is made.

If the Supreme Court deems President Obama’s Healthcare Reform mandate unconstitutional, it is unconstitutional.

President Obama’s politics are a dirty business. Manipulating the traditional media and American public’s thinking rather than presenting the truth seems to be President Obama’s goal.

The traditional media has omitted the fact that President Obama is going to make major disruptive changes to Medicare on his own. He is going to decrease Medicare funding by $500 billion dollars.

In fact, the decrease funding was to take effect before the election.

He conveniently delayed the scheduled reduction until after the election in order to not upset seniors and lose the senior vote.

Former Medicare/Medicaid administrators disagree on the potential for major disruptions in Medicare.

“There is an independent legal basis to pay providers if the Supreme Court strikes down the entire law,” said Thomas Barker, a former Health and Human Services general counsel in the George W. Bush administration.

Tom Scully was CMS Director Medicare during former President George W. Bush’s first term.

He said,

He does not foresee major problems, although he acknowledges it would be a “nightmare” for agency bureaucrats.

Scully dismissed the notion that private Medicare plans would be jeopardized if the Supreme Court throws out the law.

“The idea that Medicare Advantage plans would shut down and patients would be thrown into the street is just people making up arguments to stir the pot,”

 President Obama has been planning to get rid of Medicare Advantage with his Medicare funding reductions. Seniors will then be in an uproar.

“Even if the law were completely overturned, the government would still have authority under previous legislation to pay hospitals, doctors, insurance plans, nursing homes and other providers.”

My interpretation is that this is another “trick play” by President Obama intended to put pressure on the Supreme Court to not overturn the law.

It will not work. President Obama’s disinformation and manipulations of the traditional media are wearing thin on everyone.

The opinions expressed in the blog “Repairing The Healthcare System” are, mine and mine alone

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