Thursday, January 18, 2007

State-Run Health Care--Another Minor Problem

Mitt Romney was responsible for implementing a new healthcare law in Massachusetts. It's not the same model as the one proposed for Wisconsin--in the Massachusetts plan, residents have the option of signing up for traditional commercial insurance OR taking a State-run plan.

But there are some, ah, difficulties which arose.

The state's landmark healthcare reform, which seeks to provide universal health insurance coverage, is creating an unexpected financial crisis for many clinics, nursing homes, and other healthcare providers.

The providers say they are bracing for substantial increases in their healthcare costs, as more of their employees comply with the reform law by signing up for insurance already offered by the small, nonprofit organizations.

Officials at area healthcare nonprofits say that compared to many other small businesses, they have a limited ability to offset the costs of adding workers on an insurance plan because their revenue is largely dependent on fixed federal and state reimbursements

Note that these 'officials' think that FOR-profit businesses DO have pricing power--that is, that small for-profits can simply raise prices to accomodate large cost increases. That's fatuous, but never mind...

Marva Serotkin , chief executive of the Boston Home, a Dorchester nursing home with 96 beds, said it pays 70 percent of individual health insurance and 60 percent of family insurance for employees, or about $4,000 a year for individuals and $7,000 a year for families. About 43 percent of the 212 full- and part-time employees at Boston Home are enrolled in its plan, at a cost to the nursing home of about $360,000 annually. She expects another 30 to 35 to sign up under healthcare reform, adding at least $150,000 in expenses. But most of her residents pay their bills with Medicaid, the state-federal program for the poor, which reimburses nursing homes under a set schedule.

"Well," say you, dear reader, "that's because Romney's plan uses commercial health-insurance as an option. Commercial health-insurance costs a lotta money!!"

Uh huh. The WHP numbers are (at minimum) 12% of payroll. So tell me where THAT'S coming from in Wisconsin's non-profit sector.


Billiam said...

I can tell you the supporters response. "That's their problem."

Anonymous said...

I think it is quite apparant the problem is the capitation rate for nursing homes and other primarily Medicaid/Medicare funded operations.