Boucher explains "No" vote on Health Care Reform Bill

BRISTOL, Va. – The health care reform act approved Saturday by the U.S. House would be devastating for the region’s care providers, U.S. Rep. Rick Boucher and two of the region’s health system leaders said Monday.

Boucher, D-9th, who voted against the plan, was joined by leaders of the Mountain Empire’s two major hospital chains at a morning news conference. The three also outlined their vision of what eventual compromise legislation might contain.

“Southwest Virginians clearly depend on their community hospitals for their health care delivery, so we must take every step to make sure the financial success of our local hospitals is not placed at risk,” Boucher said. “I simply could not vote for legislation that would place their [hospitals] very survival at risk and the House legislation does that.”

The House narrowly passed the measure 220-215, with 39 Democrats voting against and one Republican voting for the legislation.

The House bill would expand coverage to 96 percent of Americans, place some restrictions on insurance companies and provide federal subsidies to those who can’t afford coverage.

While acknowledging he supports health care reform, Boucher said the government-run public insurance option included in the House legislation could consume more than the narrow operating margins of rural hospitals.

“Most of the revenues our hospitals in this area receive come from a combination of Medicare and Medicaid. With some rural hospitals, it is upwards of 80 percent,” Boucher said. “Those payments do not actually cover the cost of patient care, so our hospitals are losing money on every Medicare and Medicaid patient they treat. The margin for financial solvency comes from the insured patients.”

The proposed public option would likely reimburse providers at rates comparable to existing federal programs, Boucher said.

“It’s also assumed many patients who are privately insured today would move to a government-operated health insurance plan. If that were to happen, hospitals would lose a portion of privately insured patients, to where they would be losing money on every patient they treat,” Boucher said.

Mike Snow, president and CEO of Wellmont Health System, which operates Bristol Regional Medical Center and a number of other health care facilities, compared the current public option plan to the TennCare program that Tennessee instituted to replace its Medicaid program several years ago.

“Tennessee went to a public option and there was an influx of privately insured patients into the TennCare program and it nearly bankrupted the state,” Snow said. “We believe something needs to be done, but that is not a model that is sustainable over time.”

U.S. Rep. Phil Roe, a retired physician from Johnson City, Tenn., also voted against the bill. Although he didn’t attend Monday’s news conference, he, too, compared the House public option to TennCare.

“The TennCare plan tried to provide universal coverage and make health insurance affordable, and in the end it nearly bankrupted the state as the program tripled in cost,” Roe said in a news release. “It shifted costs to the private plans, who were forced to make up the underpayments of the government program, increasing everyone’s premiums. In the end, 45 percent of those on the public plan previously had private insurance and either dropped their coverage or were dropped by their employer.”

Tennessee Gov. Phil Bredesen, who dismantled some of the TennCare program, called the federal bill the “mother of all unfunded mandates,” Roe said.

Marvin Eichorn, the chief financial officer of Mountain States Health Alliance, which runs Johnson City Medical Center and other health care facilities, said including the House public option in the final bill would mean sweeping changes for hospitals and health care systems.

“There’s no way, if that public option gets put into place, that we can survive,” Eichorn said. “We’ve got very small [profit] margins to begin with – that would take away whatever margins we’ve got.”

Last year, MSHA’s operating margin was just $7 million of the $800 million taken in, Eichorn said.

About 60 percent of MSHA patients have Medicare or Medicaid, 32 percent have private insurance and 8 percent have no insurance. In addition, the federal Medicare program reimburses MSHA at about 92 percent, while Medicaid reimburses the health system for only about 60 percent of its costs, Eichorn said.

“In our case, we’d be looking at some fairly significant things to change the way we do things and where we do it in the region,” Eichorn said. “We now have five hospitals in Southwest Virginia. A lot of the reason these Southwest Virginia hospitals chose us was they wanted us to bring orthopedics and surgeons into the community – things they couldn’t do themselves.”

Snow said his company’s reimbursement rates from federal programs are comparable and the public option included in the House bill would affect care.

“It would be an incredibly difficult operating environment. There are facilities that couldn’t survive,” Snow said. “I worry about the small, rural facilities because that’s who would feel the greatest material impact from these kind of changes. We both have small, rural facilities, so we’d both be very negatively impacted.”

Both Wellmont and Mountain States are not-for-profit companies.

Boucher and the two health care leaders offered vastly different opinions of what a Senate version of the bill – and any eventual compromise – might include.

“It’s much more difficult to get something like this passed in the Senate,” Snow said of the House bill. “I think it could go until March because this is a very difficult issue. A lot of what is in the House bill will not be passed in the Senate. It looks like very different bills will emerge. That’s a good thing.”

Eichorn said he also doesn’t expect the current “public option” to be part of the final bill, but some type of state option might make the cut.

“I think the Democrats realize this is their shot to get some sort of comprehensive health care reform passed. If the Senate bill doesn’t have a public option and they go to the conference committee – I think they’ll find a way to work something out to get to the president,” Eichorn said, adding that he expects a vote this year.

Boucher said the vote could occur this year, but he’s not certain what the final form might be.

“It is possible there will not be a public option in the Senate bill. It is possible that some vehicle is created that would enable competition to private health insurance and be a state-based decision to have that alternative and what that alternative would be,” Boucher said.

He also predicted that a plan advanced by Senate Majority Leader Harry Reid – in which states could opt out of a federal program – wouldn’t be approved.

“I think it’s vitally important we enact a reform because the status quo is simply not sustainable. We do need to make sure that everyone in this country has affordable access to health care,” Boucher said, adding that he hopes the final version would have strong bipartisan support.

Boucher said the majority of voters in Southwest Virginia likely opposed the House bill, but still want some type of reform.

In his statement after the vote, Roe said the bill “costs too much. It taxes too much. It does nothing to improve health care and will result in the majority of Americans left with decreased access, decreased quality and increased costs. It is, as the Wall Street Journal called it, the “worst bill ever” and deserves to be rejected.”

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