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Medicaid Rollback 'Has the Potential to Cripple Us'

Analysis  |  By Christopher Cheney  
   March 20, 2017

The CEO of a community hospital in NH warns of dire consequences if coverage gains achieved through Obamacare are reversed by the American Health Care Act.

Before lawmakers in Washington roll back Medicaid expansion under the Patient Protection and Affordable Care Act (PPACA), they should meet face-to-face with Peter Wright.

Wright is president and CEO of Claremont, NH-based Valley Regional Healthcare, which operates a 25-bed community hospital. "Any negative changes to Medicaid will be just brutal for us. Our financial assistance program has been reduced dramatically since expanded Medicaid and the ACA have gone into effect," Wright told HealthLeaders last week.

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New Hampshire is one of a handful of states that expanded Medicaid through the so-called private option, which allows income-eligible adults to purchase subsidized health coverage on the PPACA insurance exchange. This year, about 50,000 low-income Granite State adults have coverage through Medicaid Expansion.

Claremont is located near the White Mountains in New Hampshire's North Country. The area's views of the high peaks and low per-capita incomes are hallmarks of the community.

Wright says the Medicaid coverage cutbacks proposed in the American Health Care Act (AHCA) wending through Congress would have a devastating impact on Valley Regional and many of its patients.

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"It has the potential to cripple us. Somewhere between 64% and 67% of everything we do in this organization is serving patients on Medicare, Medicaid or financial assistance," he says. "We are already in a fragile state and financially struggling, with no margin or a negative margin."

For the 2016 fiscal year, Valley Regional posted operating revenue at $38.4 million. Operating expenses outstripped revenue by more than $4 million.

Last week's scoring of the AHCA by the Congressional Budget Office, which projected millions of Americans would lose coverage from the rollback of Medicaid Expansion, is sending chills across the North Country.

"The CBO scoring confirms our concerns that the AHCA will leave hundreds if not thousands of patients without critical insurance coverage. We know that 961 people in Claremont (roughly 7%) and 2,128 people in Sullivan County (roughly 5%) have the potential of losing their coverage," Wright says.

Adoption of the AHCA or any other legislation that undermines insurance coverage for economically disadvantaged Americans poses an existential threat to Valley Regional and many of its patients, he says.

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"Studies show that once patients lose coverage, they avoid necessary primary and preventive care, leaving medical issues to become emergency situations. This more severe care usually ends up in the emergency department, where the cost is higher. Without insurance, Valley Regional will be forced to absorb the expense, increasing our uncompensated care and threatening our financial stability."

Losing Access
If Valley Regional is forced to close, many low-income patients will lose access to care. "We are located at ground zero of one of the communities that has the highest need in the entire state. You can't expect people in this community to travel for care because they won't. Sometimes, they even have trouble getting to us."

Any significant rollback of Medicaid Expansion will lead to a dramatic spike in uncompensated care across The Granite State, Steve Ahnen, president of the New Hampshire Hospital Association, told HealthLeaders last week.

"Since Medicaid Expansion went into effect, we have seen about a 45% reduction in the number of uninsured patients who show up in emergency departments seeking care across the state," he says.

Projected coverage reductions are just the tip of the AHCA iceberg because the architects of the bill did nothing to restore the $155 billion cut in Medicare reimbursement to hospitals over a 10-year period that helped finance Obamacare, Ahnen says.

"So, at a time when we could be seeing fewer people covered with insurance, we could also be seeing lower reimbursement for hospitals from Medicare."

The AHCA needs to go back to the drawing board, he says. "We would see a significant challenge across the state with the kind of retrenchment and rollback that is envisioned in this bill. Certainly, in many communities like Claremont, they would feel this very swiftly and very significantly."

Christopher Cheney is the CMO editor at HealthLeaders.

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