It’s budget time again at the Statehouse. I’m hearing that Rhode Island’s hospitals are asking the legislature for money. Again. This happens every year, and usually the hospitals tell us about a crisis that provides a very good reason for those hospitals to get another $100 million of our tax dollars.
This year the crisis is the number of people who are losing health insurance because of the loss of federal subsidies that supported lower premiums for people who buy insurance through HealthSourceRI. Next year the crisis will be the people who will lose Medicaid after November, when the reenrollment process of Medicaid becomes more challenging, and change in an arcane process that lets the state tax hospitals but then hospitals get that money back through Medicaid. It’s amazing. There is some crisis or other that impacts hospitals, every single year.
It makes good sense for us to fund hospitals, of course, because hospitals serve the community and help protect the public’s health. No one wants to go without hospitals. We all want the emergency room and the operating room and all those other hospital assets, like oxygen and blood ( see my last column) and midwives and obstetrics and family doctors to deliver babies (hint, hint, Brown University Health – Newport’s Maternity Unit matters!) and ICUs – we all want nurses and doctors who know what they are doing and are kind and listen, to be there when we get hurt, or seriously ill, or are going to have a baby.
That said, the financing of health care in general, and of the funding hospitals in particular, is a confusing mess, a shell game, a game of three-card Monte in which we all lose.
Here’s how the shell game works: about 70 percent of all hospital money is from Medicare and Medicaid, even though people with Medicare and Medicaid make up, together, about a third of the population. (That’s because old people and poor and disabled people are more likely to get sick – what a shock!) The nonprofits that own hospitals bill Medicare and Medicaid, usually for more than the services they provide cost to deliver. Not just more, but much more. But then Medicare and Medicaid pay hospitals less than those services cost to deliver, because Congress and legislatures are always trying to save money, and they assume (usually correctly) that there is waste in the system, and that they can get rid of waste by underfunding institutions. Hospital executives then cut back on the services that lose money – but they rarely cut their own multimillion dollar salaries. Which keeps hospitals almost breaking even, although they almost never break even in fact, at least on paper.
All this gives hospitals the ability to say that they are losing money and need more public funds.
Because people in the legislature have to respond to their constituents, who don’t like long lines in the waiting room, and don’t like it when they can’t find a doctor or have trouble getting an appointment with a specialist, and don’t like it when the local hospital closes, the legislature usually comes around, not for the full $100 mill, most years, but for $30 million or $40 million, and both hospital administrators and legislators walk away more or less happy.
Hospitals usually stay open.
But no one notices that our health care dollars don’t buy us great public health, and that our health care keeps getting more and more expensive, draining the taxpayer dollars we need to build more housing and better schools, which are the things that matter for health. No one holds hospitals accountable for making health care affordable or effective, because we now think hospitals only job is to keep the lights on at the ERs and Ors and ICUs (and hopefully, Birthing Centers.) The hospital administrators get paid, usually in the millions of dollars, which isn’t a bad gig, if you are running a nonprofit.
But we don’t get a health care system that takes care of everyone and does that affordably, one that’s easy to use and actually prevents preventable diseases.
We could do better than this, of course. We could provide primary care to everyone in Rhode Island, which, if we did it well, would drop the need for hospital beds in half, and drop hospital administrator salaries at the same time. We could put hospitals on a budget, like they do in Maryland, and provide effective oversight of hospital operations. Using the hospital licensing statutes, we could make sure all hospitals provided more essential services and provided them affordably and make sure hospitals don’t run the meter on the services, (which hospitals call service lines) that make hospitals the most money.
In the short run, we could and should require publicly appointed seats on hospital boards every time our hospitals ask the legislature for money. That way we might do a better job at making sure hospitals function in the public interest, and not so much for the benefit of their administrators. Imagine asking a venture capitalist to invest $100 million in a business that is losing money? That venture capitalist isn’t going to invest one red cent in any business over which they don’t exert significant control, nor should they.
We should learn from this example. Hospitals run on public money. They are community assets. The public should have a role in their governance, to make sure they focus on their mission, which is helping communities stay safe and well — and not just on their profit margins.
We could have health care that is affordable, effective, human, and available. But we don’t.
We all just go along to get along. Everybody has a cousin whose ox might get gored. Everybody knows a guy.
That’s crazy.
You can find Michael Fine’s commentaries and short stories on
https://michaelfinemd.substack.com/and on http://www.michaelfinemd.com