Sweeping health-care legislation that will extend insurance coverage to millions more Americans will place additional financial burdens on teaching hospitals and squeeze the money available to pay for education and research.
That was the consensus of University of Texas system leaders and the presidents of its six health institutions who met here Wednesday to share strategies for treating more patients with less money.
The national legislation, which was signed into law in March, has administrators of many academic health centers worried about how growing Medicaid rolls and shrinking reimbursements will affect their bottom line.
In Texas, the legislation is expected to add up to two million people to the Medicaid rolls. Teaching hospitals already lose money on Medicaid patients because they aren’t reimbursed for 100 percent of the patients’ care. Per-patient reimbursement levels are expected to be further reduced under the new health law, speakers here noted.
“The good news is that the uninsured will have access. The bad news is that under the current reimbursement system, none of us will have our costs covered,” said John Mendelsohn, president of the university’s M.D. Anderson Cancer Center.
The proportion of uninsured people could drop from 25 percent to 8 percent in Texas, according to figures released by the University of Texas system. Among those who will remain uninsured, and continue to rely on safety-net hospitals, are undocumented immigrants, who will be ineligible to buy insurance from the new health-insurance exchanges set up as a marketplace for private insurance.
Teaching hospitals obviously welcome the expansion of insurance coverage, but there’s a downside: Beginning in 2014, the federal government will also cut the supplemental payments it has been making, through both Medicaid and Medicare, to compensate them for the disproportionate number of low-income people they treat.
With fewer people uninsured, that wouldn’t appear to be a problem. But low reimbursement levels are prompting more community physicians to limit the number of Medicaid patients they are willing to treat, so more of the newly insured patients are likely to end up crowding into teaching hospitals, which are required to treat them, university officials noted.
The presidents are also worried that the state, which faces physician shortages in many areas already, will not be able to meet its growing health-care needs because there aren’t enough training positions for new doctors. Nationally, the number of residency slots that Medicare pays for remains capped at 1996 levels, even as schools ramp up their enrollments to meet projected physician shortages.
“Our medical schools have been gearing up to produce more medical graduates, but if we don’t have the residency slots, that will drive a significant number of people out of state, and we only get half of them back, if we’re lucky,” said Kenneth I. Shine, executive vice chancellor for health affairs for the University of Texas system.
Among the strategies the university health-education programs are turning to are new ways of delivering patient care, such as the “medical home” model, in which a physician oversees a team of health providers who offer a continuum of services. The institutions also plan to rely more on nurse practitioners and physician assistants to provide primary-care services.
