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AMCs React to Being Shut Out of Some Exchange Plans

   December 13, 2013

Some academic medical centers are being excluded from state health insurance exchanges because their costs are higher than other hospitals'. The resulting squeeze on revenues "raises very real worries about hospitals' ability to carry out their mission," says the New Jersey Hospital Association.

Though health plan coverage purchased through the exchanges take effect in just three weeks, it's still too early to say what impact the new policies' so-called "narrow networks" will have on some hospitals' multiple missions when plans reroute thousands of patients to other doctors and hospitals.

But for academic medical centers and their physicians, many of whom are excluded from many health plans products because their costs are higher than other hospitals', the ramifications are worrisome.

There are potential negative impacts not just on patients, but on the organizations' multiple missions to teach and perform research, and on maintaining margins to sustain a high quality of specialized care, such as transplant programs and cancer treatments.

Those are the views of Joanne Conroy, MD, Chief Health Care Officer at the Association of American Medical Colleges and a former hospital CMO and COO. "Right now, we're watchfully observing how many people move into the exchanges and what it actually means for the financial sustainability of academic medical centers," she says. The impact on hospitals' census numbers, she acknowledges, "is a concern, but it remains to be seen."

While most media reports have focused on patients' misperceptions of what they are buying with their premium dollars, few reports have examined the ultimate impact on these teaching and research hospitals and clinicians, many of which are located in the middle of low-income urban areas where many of the exchange customers live and work, and where many have long received whatever care they got.


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