Emergency rooms feel fiscal pain

CAL/AAEM News Service calaaem_news at yahoo.com
Thu Oct 7 19:12:03 PDT 2004


Emergency rooms feel fiscal pain 
Uninsured patients cost hospitals, docs millions, study says 

September 22, 2004 


Emergency departments drained $635 million from California hospitals and doctors in
fiscal year 2002 as a growing number of uninsured residents turned to them for care,
according to a report released Tuesday by the California Medical Association. 

The fourth annual report on emergency room losses found that deficits reported by
hospitals and doctors increased 18 percent between fiscal year 2000-2001 and fiscal year
2001-2002, the most recent year for which statistics are available. 

The losses stem from emergency care that was provided but never paid for. Hospitals
reported $460 million and physicians $175 million in unreimbursed emergency care for the
year ending in June 2002. 

Association officials cited the inability of hospitals to keep up with increased demand,
which has led to the closure of 28 ERs since 2000. San Jose Medical Center, one of three
trauma centers in Santa Clara County, recently announced it will close Dec. 1. 

"We face an unraveling of our health care system," said Dr. Jack Lewin, chief executive
officer of the association, which represents physicians. "The people of San Jose are very
clear about it right now because their major hospital ... has announced it's insolvent.
We're facing a crisis." 

The association's report comes as the physician group lobbies for an initiative on the
November ballot, Proposition 67, that would raise about $600 million for emergency
services and community clinics in California through a tax on in-state telephone use. The
association has been increasingly vocal in recent years about the problems of doctors who
provide emergency treatment without payment. 

Los Angeles County accounted for almost a third of the state's ER losses. 

The fiscal shape of emergency departments in the Bay Area varied widely depending on the
county, the report found. For example, emergency department losses in Alameda County
increased 61 percent between fiscal years 2000-2001 and 2002-2002, while the losses in
San Francisco County dropped 29 percent during the same period. 

Since then, several emergency rooms throughout the state have closed or announced plans
to do so. Los Angeles County officials this week announced the third shutdown of an
emergency room or trauma center in a month. 

Alameda County's rising emergency room losses were one factor that prompted it to close
two clinics in 2003. In March 2004, voters approved a half-cent sales tax to compensate
for its $71.6 million deficit. 

The association's report, which used data from the Office of Statewide Health Planning
and Development, contrasts with findings of a study released in June 2003 by the
University of Southern California and the California HealthCare Foundation, an Oakland
health philanthropy. 

That study agreed emergency departments lose money if only the revenue they generate
directly is considered. Looked at more broadly, though, they actually generate profit for
their hospitals because they lead to admissions and additional care, the study concluded.


According to the report, hospitals may lose about $80 per patient treated and discharged
from the ER, but they made an average $1,220 in profit on each patient admitted for
further care. 

The study's author, Glenn Melnick, said the association's report doesn't take revenue
from admissions into account. "That's kind of like a hotel saying we lose money on the
parking lot because we don't charge for that," he said. 

"If they (hospitals) are in a financial crisis, it's not necessarily attributable to only
the emergency department," he said. "It's generally attributable to the fact they're
losing money on the inpatient side." 

But Lewin said if a hospital or physician is not reimbursed for an uninsured patient's
care in the emergency room, that won't change when the patient is admitted for
longer-term care. 

According to U.S. Census data, about 6.4 million Californians are uninsured. As the
problem grows, Lewin said, California patients will face longer wait times and more
instances of diversion to other institutions.


Source: Victoria Colliver, Staff Writer, San Francisco Chronicle


=====
Cyrus Shahpar & Brian Potts 
Managing Editors, CAL/AAEM News Service 
UC-Irvine



		
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