Charity Care
Shifting costs from the uninsured to the insured has always occurred in healthcare as well as most industries. You can bet that Hurricane Katrina will cause insurance rates to respond as cost shifting and cost sharing occur.
Hospital reporting Charity care is widely variable because of the inconsistencies in the way it is provided, reported and paid for.
The estimated number of uninsured Americans is somewhere around 45 million. Many small businesses no longer are providing coverage because it is too expensive, rising insurance premiums are causing many people to opt out of the insurance offered, and the economies up and downs will cause turnover and subsequent health insurance lapses.
There are an estimated 10.3 million undocumented workers in the U.S. who do not apply for benefits for fear of immigration issues.
Because ER’s have to treat everyone, the free medical care for uninsured people is mounting. All of this adds to the numbers reported as Charity Care by hospitals.
A survey done by PricewaterhouseCoopers showed the following:
• Hospitals in the survey reported providing charity care equivalent to an average of 5 percent of net operating income, although many provided levels that are significantly higher.
• Ninety-two percent of hospitals surveyed said that part of their bad debt could be classified as charity.
• Hospitals increasingly are revising and communicating their charity care policies.
The question remains as to what is “Charity Care” and what is “bad debt” and this is where confusion is leading to more legislative action, litigation, and bad press.
This is also where some hospitals find themselves having trouble in their budget assumptions and profits.
Not for profit hospital’s like Floyd are required to quantify these numbers to qualify for exemptions. Making assumptions that are invalid can be troublesome when overestimated as well as underestimated.
There are very little well-defined standards accepted by all hospitals on what qualifies as Charity Care. Many hospitals do not comply with the requirements set by outside agencies. Patients also need to assist with providing accurate information to make these assignments correct.
Uncompensated care and Charity care are not necessarily interchangeable terms.
Most hospitals continue to base their Charity Care on charges rather than cost which tremendously overestimates what they actually provide.
True Charity Care is of major importance because it affects not only healthcare resources, bed utilization, physician time, staff time, but also how costs are reallocated to other patients.
If we believe the government should help provide for Charity Care, there needs to be some standards in place that are accurate and reproducible based on cost and not charges and all hospitals should calculate it the same.
Hospital reporting Charity care is widely variable because of the inconsistencies in the way it is provided, reported and paid for.
The estimated number of uninsured Americans is somewhere around 45 million. Many small businesses no longer are providing coverage because it is too expensive, rising insurance premiums are causing many people to opt out of the insurance offered, and the economies up and downs will cause turnover and subsequent health insurance lapses.
There are an estimated 10.3 million undocumented workers in the U.S. who do not apply for benefits for fear of immigration issues.
Because ER’s have to treat everyone, the free medical care for uninsured people is mounting. All of this adds to the numbers reported as Charity Care by hospitals.
A survey done by PricewaterhouseCoopers showed the following:
• Hospitals in the survey reported providing charity care equivalent to an average of 5 percent of net operating income, although many provided levels that are significantly higher.
• Ninety-two percent of hospitals surveyed said that part of their bad debt could be classified as charity.
• Hospitals increasingly are revising and communicating their charity care policies.
The question remains as to what is “Charity Care” and what is “bad debt” and this is where confusion is leading to more legislative action, litigation, and bad press.
This is also where some hospitals find themselves having trouble in their budget assumptions and profits.
Not for profit hospital’s like Floyd are required to quantify these numbers to qualify for exemptions. Making assumptions that are invalid can be troublesome when overestimated as well as underestimated.
There are very little well-defined standards accepted by all hospitals on what qualifies as Charity Care. Many hospitals do not comply with the requirements set by outside agencies. Patients also need to assist with providing accurate information to make these assignments correct.
Uncompensated care and Charity care are not necessarily interchangeable terms.
Most hospitals continue to base their Charity Care on charges rather than cost which tremendously overestimates what they actually provide.
True Charity Care is of major importance because it affects not only healthcare resources, bed utilization, physician time, staff time, but also how costs are reallocated to other patients.
If we believe the government should help provide for Charity Care, there needs to be some standards in place that are accurate and reproducible based on cost and not charges and all hospitals should calculate it the same.
Labels: Charity care
posted by Anonymous at 5:52 AM
26 Comments:
In 1993 when Bill Clinton took office, health care was on the table and here we sit in 2007 with a problem that's been swept under the rug. Meanwhile physicians and hospitals are supposed to take care of people that can't pay for their healthcare and Congress won't reimburse either party to even cover their costs. In 2008, we the people must make a difference with our vote and decide where we want to spend our money, at home or abroad.
I, for one, will cast my vote for the candidate who will let me keep my own money and pay for my own health care, rather than paying for someone else.
The Dems like to promise everyone healthcare, and it sounds attractive. But the underlying numbers will likely be something like extremely low income people will get free healthcare coverage, a family of 4 making less than $28,000 will recieve susidized healthcare coverage, and everyone else will be paying more for healthcare than they are now.
The Democrats want to take better care of all the freeloaders in the world today, and everyone knows who has to pay for it, the working people.
If the overall cost of healthcare for you and/or your employer could be reduced by a government program of shared responsibility, would you still be against it based on the principle that someone might get help for free?
This comment has been removed by a blog administrator.
For you "courageous" anon posters, just what is your plan for the working poor? What is your plan for the children of actual freeloaders?
"If the overall cost of healthcare for you and/or your employer could be reduced by a government program of shared responsibility"
Sounds great, however, we are going to provide new coverage to millions of people, increase reimbursements to providers, and lower the overall cost?
Sounds eerily like fuzzy math.
I'm still waiting for a plan. I see now why you remain anon.
I didn't produce any math or make assumptions about any possibilities.
I asked an ideological question concerned with priorities.
Reducing costs and making sure everyone pays their own way are two different goals stemming from different values. Which carries more weight?
Until there is some sort of consensus about what healthcare problem we're trying to solve, the chances of cooperatively solving it are slim.
It'd be a tremendous undertaking, but I think it would interesting to calculate the total amount spent on healthcare and health insurance by Floyd Countians and their employers each year.
From there, you could look to see how much of that money was put back into our local care mechanisms versus how much ended up as profit in far away insurance company coffers.
What could we accomplish if we kept that profit within the community? Increased access? Increased reimbursements? More autonomy? Maybe we'd find out how to better manage the money so the same level of service and access provided now could be attained at lower cost.
Whether through public or private means, why not explore localizing the entire insurance/payment scheme to the extent possible, creating jobs, expanding the tax base, and keeping our dollars here?
I think we sometimes get far too caught up in the "national problem" model and ignore opportunities to solve our own problems through self-sufficiency.
There are a couple of things lacking in your vision of a Floyd County health plan. Foremost is capital. Those faraway insurers (although not really faraway, I'm sure many individuals here own their stocks, especially Humana) make a profit because they are putting their capital on the line, and investing in computer systems, customer service centers, etc. If they couldn't earn profits, that capital would flow into other companies and industries that could.
Any reason those Humana investors couldn't invest in a Floyd County operation instead?
Why do we need a government program to take care of anybody or anything. Lets go back to the days of providing for our own well-being. Get the people off the couch and in the work force and everyone will be much better off.
The same people that were on welfare 30 years ago have off-spring that is on it today. I wish someone would do a little research on all the Head-Start graduates and see where they are today. I would venture to say more than half are on Medicade.
For you "courageous" anon posters, just what is your plan for the working poor? What is your plan for the children of actual freeloaders?
2/21/2007 12:55:00 PM
I'll be "courageous". Because of our procrastination, we have a disorganized system that soon will become a single payer system, where government pays for health care and covers the cost by taxing us and collecting premiums.
Bluegill, a Floyd County plan would not be of sufficient scale to be viable. Aetna is considered "small" in the health insurance industry. It covers 15 million people. The population of Floyd County is 60,000.
Anon 3:37,
I still don't see a plan from you.
How do you purpose to handle the healthcare of the children of the "people on the couch"? What about people who have lower paying jobs and their healthcare? What about their children?
I work many hours and pay many dollars in taxes also. I don't have a lot of sympathy for freeloaders either but you can't blame their children. It makes the question much tougher, doesn't it?
Mark
I don't think a plan can attempt to address only health insurance without also addressing the underlying problem - the spiraling cost of healthcare.
I can tell you that everyday, there are hundreds of thousands of medical procedures performed whose medical benefit does not equal or exceed their cost, in other words, the underlying motive is profit.
My plan is put the parents on a payroll somewhere and make them work for a living. Thats what I did, my spouse and I both worked, to make ends meet. My kids stayed home with the oldest babysitting eating sandwiches for lunch, while our taxpaying dollars were feeding children at Headstart sites hot lunches. Then when I got home from work I picked up the newspaper and would read how the welfare mothers loved the headstart program, because it gave them some down time to rest or just maybe clean their subsidized housing. I'm sure you get the picture. Check our schools and see how many kids are on free breakfast and lunch while your at it. I got up and fixed my kids breakfast and lunch and didn't wait for the government to pay for it. Some of these parents don't even get out of bed to see there kids off to school, why should they. Let someone else take charge.
The forces of supply and demand do work in welfare. As long as you are willing to supply it, there will always be a demand for it.
Anon 12:14,
You are to be commended for what you did(do). In an ideal world that is what should happen. Unfortunately, the world is not an ideal place.
You mention making these people get a job somewhere. What if that job does not have benefits and the pay is so low they cannot buy private coverage?
What of the people who are too lazy, too "dumb", too whatever? What about their children? I can see the answer now, "they should not have them if they can't support them". Good point, but again, that is the ideal.
Mr. Scrooge, in the Christmas Carol, made a statement about decreasing the surplus population. Is that what we really want?
The lazy, poor, dumb are provided with every benefit in the world to better themselves in today's world, but many do not want any part of the opportunities that the
government has afforded them, because it is much easier to get their check in the mail and do nothing. It makes no difference what the many programs do, to try to teach children that there are other alternatives other then becoming dependent on the government, at the end of the day most will return to what they have always lived with. As a society, we are at fault by providing more and more benefits for the "poor", it is becoming much easier to be "poor" and receiving services than trying to be a citizen that is self-supporting and trys to stand on their own 2 feet. Point in case, I heard on TV last night, that Indiana is going to try Full Day Kindergarten starting with the "poor". Now, granted this may apply to some, but who would benefit by full day kindergarten? I would think that it would be beneficial to the people where both parents were working to make a living. Not the ones where a parent was at home all day. I am not a scrooge but there comes a time when people take responsibility for their own actions. Good thing I am not in charge,if so this would be the cleanest country in the world because people would pick up every peice of litter along every road in the country and then they could pick up their welfare check, what difference would it make they are going to get it anyway.
The Floyd county plan would never work.
Our hospital just misplaced $11.5 million dollars by some error.
I don't want these guys managing my health or my money
In 1993 when Clinton took office, Hilary wanted to take care of Healthcare, but her plan was mandatory ultrasounds for pregnant mothers and if you had a Downs Syndrone child or a Spina Bifada child then you were ordered to have an abortion and if you didn't then you had to get private healthcare for that child.
Statement is true, the Director of Finance had first hand participation in the destruction of the hospital finances and while she may have been directed by the ex CFO, she did not do anything about it. Others brought up Red flags and nothing was done about it. The Director of Finance cant be trusted and should not be in any role, including interim CFO
Anon 11:32,
Really glad to hear that you are not a scrooge. I like your idea of picking up the trash and litter before picking up a welfare check.
Since you are not a scrooge, I assume that you are volunteering to babysit the children of those out picking up litter? You are such a peach of a person.
Maybe you like to take care of other peoples kids, but the Government has provided for that as well, let them go down to HEADSTART and while they are there than the lazy-ass parents can get off the couch, put out their cigarettes, and pick up trash. Go out to our local housing projects, take a look around, they could start picking up trash there. Glad you think I'm a peach but I rather think I am being realistic
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