Hospitals May Benefit Under Healthcare Reform 2009: Hospitals Gain

Hospitals may benefit under healthcare reform

Hospitals may gain as much as $16 billion over a decade from the Obama administration’s proposals to overhaul the health-care system.
The benefit would more than offset $155 billion in proposed cost cuts during the same period that hospitals promised in a deal with the White House. Hospitals are among six interest groups that pledged in May to cut $2 trillion over 10 years to support President Barack Obama’s top domestic goal of reducing health-care costs and covering the nation’s 46 million uninsured. Hospitals will benefit from the elimination of bad debt for treating those without insurance, said Ira Loss, a senior health analyst at Washington Analysis, a company that examines the effects of public policy decisions. “If you look at any hospital company’s statements, they have huge bad debt,” of up to 10 percent, Loss said. “There’s no question that’s a plus for them.” The AHA, the Federation of American Hospitals and the Catholic Health Association pledged to cut costs at a May 11 event with Obama, insurers, drugmakers, a major union and doctors. Hospitals agreed to the gradual reduction of $50 billion in government payments they receive for treating the uninsured.
Another $2 billion in cuts would be made assuming the number of patients being readmitted to hospitals would fall because of procedural changes pushed by the administration. Another $103 billion would come from reduced payments from Medicare, the government’s program for the elderly and disabled.

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