Thomas A. Selden
President & CEO
Southwest General Health Center
Middleburg Heights, Ohio
We understand and expect that reimbursements will decrease in the future. We are planning for a 2% to 3% per year decrease in our revenues from Medicare, and probably commercial payers falling behind them. We are leaning our organization so we can accommodate that and still maintain our margins. It's a multifaceted area but if you don't manage your labor, you can't manage anything.
Uncompensated care should theoretically disappear under the Affordable Care Act. The number of people who come to us without insurance if the act holds will be decreased eventually, almost to nothing except for certain people who are not covered by the act. But people with lower incomes are still challenged with the copays and high deductibles they have to pay. So we expect there still will be bad debt going on even if they are insured.
A lot of healthcare organizations get that reimbursements will decrease, but they may not be as sharp in figuring out how to deal with it. That may be why some say they are poorly prepared. It's not that they don't understand that it is going to happen, they just don't know what to do about it.
This article appeared in the July 2012 issue of HealthLeaders magazine.