THE
COMMONWEALTH
FUND
Sustaining Safety Net Hospitals
Pamela Riley, M.D., M.P.H.
Program Officer, Vulnerable Populations
The Commonwealth Fund
Alliance for Health Reform Briefing
Washington, D.C.
June 4, 2012
What is the Health Care Safety Net?
• Health care providers that organize and deliver a
significant level of health care and other healthrelated services to uninsured, Medicaid, and
other vulnerable patients (Institute of Medicine).
• Core safety net providers are required by
organizational mission or legal mandate to
provide care to patients regardless of ability to
pay.
• Includes hospitals (public; non-profit; academic
medical centers), community health centers,
local health departments.
Institute of Medicine. America’s Health Care Safety Net: Intact but Endangered. Washington: National Academies Press, 2000.
What is the Role of Safety Net Hospitals?
• Provide inpatient, primary and subspecialty care
for Medicaid, low-income, and uninsured
populations.
• Provide other specialized services (trauma
centers, burn units, inpatient psychiatric care).
• Serve as sites for training physicians and other
health professionals.
• Serve as economic engines of communities—
safety net hospitals contributed over $120 billion
in 2009 to state economies, and to over 800,000
jobs nationally.
Source: National Association of Public Hospitals and Health Systems. Safety Net Health Systems: Keeping Americans
Healthy and Working, October 2011.
What Populations do Safety Net Hospitals Serve?
Discharges at NAPH Member
Hospitals and Health Systems, by
Payer Source, 2009
Nationwide Estimates of Hospital
Discharges, by Payer Source, 2010
Other
3%
Source: NAPH Hospital Characteristics Survey, 2009
Source: HCUP Nationwide Inpatient Sample
(NIS), 2010, Agency for Healthcare Research
and Quality (AHRQ)
Disproportionate Needs of Patients Served by Safety Net Hospitals and System
Characteristics to Address Needs
Disproportionate Needs
Safety-Net System Characteristics
Health-related
needs
Chronic conditions
Disability
Mental illness
Substance abuse
Reproductive health care
Personal and
social factors
adversely
affecting health
Dangerous work
Unhealthy environments
Unsafe environments
Chronic stress
Shortage of personal time
Illiteracy
Low social support
Homelessness
Poor nutrition
Health risk behaviors (smoking, substance abuse, inactivity)
Disability
No sick leave
Language barriers
Cultural disparities
Transportation
Nontraditional work hours
Transient residence
Disability
Team care
Care management
Care coordination/Integration
Medical home
Co-located services
Integrated services
Social services
Patient education
Outreach services
Facilitated enrollment in public programs
Wraparound services
Personal and
social factors
affecting health
care access
Extended hours of service
Language services
Transportation services
Cultural sensitivity
Electronic heath records
Home visits
Home health care
Telephone advice lines
Electronic visits
Source: E. L. Schor, J. Berenson, A. Shih, S. R. Collins, C. Schoen, P. Riley, and C. Dermody, Ensuring Equity: A Post-Reform Framework to Achieve High
Performance Health Care for Vulnerable Populations, The Commonwealth Fund, October 2011.
What is the Impact of the Affordable Care Act on
Safety Net Hospitals and the Populations they Serve?
• Potential for increased Medicaid revenues—an estimated 16
million people will acquire Medicaid under ACA.
• Cuts in disproportionate share hospital (DSH) payments,
which help cover costs of caring for Medicaid and uninsured
patients.
– Safety net hospitals have higher average uncompensated
care costs as a share of total costs (16%, compared to 6%
nationally)
• An estimated 26 million people under age 65 will remain
uninsured after full implementation of the ACA—safety net
hospitals will still be needed to care for this population.
Source: Congressional Budget Office, CBO and JCT’s Estimates of the Effects of the Affordable Care Act on the Number of People Obtaining
Employment-Based Health Insurance, March 2012; National Association of Public Hospitals and Health Systems. America’s Public Hospitals
and Health Systems, 2009: Results of the Annual NAPH Hospital Characteristics Survey, December 2010.
Today’s Panelists
Deborah Bachrach, J.D.
Special Counsel, Healthcare Transaction and Policy,
Manatt, Phelps & Phillips, LLP, New York, NY
Billy Millwee, M.Sc., M.A.
Texas Medicaid Director, Austin, TX
Arthur Gianelli, M.B.A., M.P.H.
President and Chief Executive Officer, Nassau Health
Care Corporation, East Meadow, NY
Patrick Conway, M.D., M.Sc.
Chief Medical Officer, Centers for Medicare and
Medicaid Services, Baltimore, MD
Key Questions
• Regarding Medicaid and DSH payment policies, what are
potential federal policy options to better target existing
funds to hospitals serving low-income, high-need
patients?
• What is currently being done to address the current
financial challenges facing safety net hospitals, and to
prepare safety net hospitals for funding changes under
the ACA?
• How can ACA provisions affecting safety net hospital
financing be implemented to maintain the financial
stability of safety net hospitals while promoting highquality, efficient care?