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GOP Repeal Plan Could Mean Big Losses For Kentucky Hospitals

Kentucky Hospital Association

The latest plan by Senate Republicans to repeal the Affordable Care Act — also known as Obamacare — would essentially give states the right to create their own health care systems. That could mean big health insurance losses for Kentuckians, and for hospitals.

Currently, the federal government offers a nationwide exchange and sets a baseline of benefits that low-income people receive through Medicaid.

Under the Graham-Cassidy bill, a state like Kentucky would get one block of money to again set up something like the now-defunct state exchange, Kynect, as well as do what it wants with Medicaid.

That would mean people could lose health insurance, have fewer doctors’ visits, and end up in the emergency room.

Julius Hobson, a health care consultant in Washington, D.C., said that would cost hospitals more money.

“So you’ll see more people coming into the ER who are much sicker and therefore expensive, but don’t have the means to pay, which will cost the hospital more out of its budget," he said.

Democratic Congressman John Yarmuth of Louisville said Graham-Cassidy would have a major impact on area hospitals.

“I’ve talked to some hospital administrators, and the hospital administrators in Louisville were — and I’m sure are — very concerned," Yarmuth said. "They’ve seen their uncompensated care reduced significantly and they don’t want to go back.”

All of this is up in the air. And according to Yarmuth, what will happen will largely be determined by who's in the governor's mansion.

“If Graham-Cassidy is passed, the state becomes the determinant for what’s funded and not funded," he said. "With Governor Bevin and his position on Medicaid, I would fear for those people.”

If Graham-Cassidy passes, changes would go into effect in 2018. By 2021, if hospitals did experience losses like Hobson predicts, the federal government would step in and start reimbursing them.

But whether Kentucky hospitals would be reimbursed is also up in the air. That's because reimbursements would also be made to states that didn't expand Medicaid, to those with a poorer and older population, among other factors. 

Beth Feldpush is with America’s Essential Hospital’s, a trade group representing hospitals with low-income and vulnerable patients. She said because there are so many factors regarding reimbursements — and not just whether hospitals experience losses — experts don't yet know if Kentucky would get reimbursed.

"That relief is not really based on need or doesn’t take into account the amount of increased uncompensated care states will see,” Feldpush said.

Even if Kentucky gets some money paid back for all the uninsured care it’s giving, there’s one more twist: The way Kentucky pays for the medical visits for people with Medicaid coverage would also changed. Instead of the federal government paying 70 percent of a doctor’s visit — with the state picking up 30 percent of the tab – the feds would give the state one pot of money to cover a Medicaid patient for one year. When that money ran out, the care would run out. And health care experts predict the money will run out.

In the end, the state of Kentucky would be responsible for much more of the Medicaid health care tab. And that, combined with the ‘maybe’ reimbursements for the uninsured – would mean the state, and hospitals, would shoulder much more.

Lisa Gillespie is WFPL's Health and Innovation Reporter.

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