Blog | Monday, August 30, 2010

QD: News Every Day--Charitable hospitals to act like for-profits to stay open


More than one-fifth of hospitals are government-owned, but states and counties are out of cash to keep them open. So, charitable hospitals are being sold to for-profit groups or facing closures. Rising costs and more uninsured patients run smack into falling Medicare and Medicaid reimbursement. When bonds come due, there's little chance of states and counties paying them back. And the facilities are often standalones, and they can't fall back on corporate backing. This year, 53 hospitals have been sold in 25 arrangements. While the deals often stipulate that care for the poor continues, so one is certain exactly how or even whether such services will continue.

That said, other charitable hospitals are making big profits. What are they doing differently? First, they're competing for patients, so they're increasing room sizes, offering amenities and even investing in high-end procedures such as robotic surgery. They continue to offer community care, but they're acting more like for-profit institutions to cover their charitable missions. But this conflicts with an old-fashioned view of what charitable care is supposed to be.

Stepping into the breach is the Centers for Medicare and Medicaid Services, which is offering one solution, by increasing reimbursement for inpatient services in rural areas. The agency is expanding a pilot program by increasing reimbursement for inpatient services. Facilities are eligible if they offer care to rural areas in the 20 states with the lowest population densities, have fewer than 51 beds, provide emergency-care services and are not a critical-access hospital. (Wall Street Journal, Washington Post, Modern Healthcare)