New York City’s public hospital system
is looking at a major cash squeeze within four years if federal cuts to
hospitals serving large numbers of poor and uninsured patients take
place as scheduled, according to a report by the city comptroller, Scott M. Stringer, to be released on Monday.
Beginning in 2017, the federal government will begin cutting subsidies
to those hospitals, based on the theory that since the passage of the
Affordable Care Act, which has insured millions of Americans, hospitals
will no longer need the same level of subsidies for uncompensated care.
But
Mr. Stringer’s report says that the city’s hospital system will not
benefit as much as expected from the Affordable Care Act insurance plans
because the system continues to serve a high proportion of undocumented
immigrants, who are not eligible for coverage under the act.
In
the health law’s first year, the number of uninsured patients the
system treated dropped by only 1.3 percent, the report said; another
decrease of 7.2 percent is projected by 2019.
More
strikingly, the city’s hospital system has not attracted enough newly
insured patients to give it the revenue increase it would need to make
up for the loss of federal funds, the report says.
“We
have a solemn commitment to fund H.H.C. so that it can serve everyone
who walks through the door, regardless of their immigration status or
ability to pay,” Mr. Stringer said in a statement, referring to the
Health and Hospitals Corporation, which runs the public hospitals.
“That’s why we need to find a real cure for these cuts, not just apply a
Band-Aid.”
The
11-hospital system expects to face a deficit of more than $1 billion in
fiscal year 2017, which will grow in subsequent years, the report said.
The city’s taxpayers are ultimately responsible for filling that gap.
The
report projects that the system’s cash on hand, an indicator of
financial stability, will drop to $44 million, from $1 billion, by
2019-2020, largely because of the projected $827 million loss in federal
“disproportionate share” subsidies.
Dr.
Ram Raju, president of the hospitals corporation, said he was working
with the city to mitigate the cuts. He said he was also trying to
persuade the state to change its methodology for financing charity care,
which he said put the corporation “last on the line.”
He
agreed that undocumented immigrant care was a problem. “The Affordable
Care Act did not bring in everybody,” Dr. Raju said. “It left behind a
group of people. They have no way of getting insurance, and most of them
are served by our system.”
The
three hospitals most affected by the burden of caring for uninsured
immigrants are Lincoln Medical and Mental Health Center in the Bronx,
Elmhurst Hospital Center in Queens and Woodhull Medical and Mental
Health Center in Brooklyn, the report said.
City
officials have long predicted that the cuts would hurt New York City
more than other parts of the country because of its large number of
immigrants.
But
the report raises another surprising factor: the failure of the
hospitals corporation’s entry into the state’s Affordable Care Act
exchange to produce as much revenue as expected.
The hospital system was counting
on its MetroPlus insurance plan, newly sold on the state exchange, to
attract young people of modest means to city hospitals, despite their
image as a last resort for the poor. But MetroPlus has not been as
successful as expected, with about a third of the 45,000 new subscribers
dropping out within the first year, the report said, adding that the
decline was because members failed to pay their premiums, among other
reasons.
Mr.
Stringer said that revenue from new enrollment in MetroPlus was
expected to offset only about 28 percent of the federal cuts.
The
report calls on the federal government to delay the cuts until their
impact can be better assessed, and for the state government to explore
the feasibility of using its own funds to cover undocumented immigrants.
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