Obamacare Triggering Cuts in Hospital Charity for Poor, Uninsured

Monday, 26 May 2014 09:52 AM

By Melanie Batley

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With the introduction of Obamacare, hospitals that treat large numbers of the poor and uninsured are slashing their charity care programs to force people to sign up for insurance and to achieve cost-cutting due to reductions in federal funds under the new healthcare law.

According to The New York Times, the trend is causing concern that the tightening access to free or discounted care could cause people not to seek needed treatment due to the higher costs they would be facing.

"Do we allow our charity care programs to kick in if people are unwilling to sign up?" Nancy Schlichting, chief executive of the Henry Ford Health System in Detroit, told the Times. "Our inclination is to say we will not, because it just seems that that defeats the purpose of what the Affordable Care Act has put in place."

Stricter policies include charging co-payments to the uninsured, reducing eligibility for discounted medical bills and slashing care to those whose income would suggest they would qualify for subsidized coverage under Obamacare.

In most cases, the new hospital policies would apply only to patients who earn between 200 percent and 400 percent of the poverty level, while patients below the poverty level may not be affected by the hospital policy changes.

The number of hospitals that are tightening access to free or discounted care appears limited so far, but experts predict it will become increasingly common, the Times reported.

"We didn't want to have a policy that would encourage people not to follow the mandate" to get health insurance, said June Fowler, a spokeswoman for BJC HealthCare, the nonprofit system that owns Barnes-Jewish and 11 other hospitals in Missouri and Illinois, according to the Times.

Hospital officials insist, however, that they have worked hard to inform patients about new insurance options available under Obamacare, and also helped to enroll patients in coverage.

Separately, some hospitals say they have been forced to make the changes to their charity care programs for financial reasons.

The Affordable Care Act reduces the federal aid hospitals receive for uncompensated care on the assumption that they would recoup lost income through payments from newly covered patients under expanded Medicaid programs, but more than 24 states have not yet taken up Medicaid expansion, so hospitals are finding themselves caught short.

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