TWIN FALLS — The Magic Valley’s rural hospitals say they don’t expect Medicaid expansion to have much impact on their patient numbers or staffing levels.
Hospital officials say expanding Medicaid, even with a mandatory work requirement and other conditions attached by the Legislature, will help people get primary care services and keep more people out of the emergency room for non-emergent conditions, which is costly for hospitals when patients can’t afford to pay their bills.
But critics of the work requirement have expressed concern that it could create a “secondary gap” of uninsured people who cannot prove they are working 20 hours a week — making it possible that hospitals won’t see the same savings they would under a “clean” Medicaid expansion as approved by 61 percent of voters last year.
An estimated 60,000 low-income Idahoans fall into the “Medicaid gap,” meaning they make too much money to qualify for Medicaid, but not enough to get federal subsidies through the Your Health Idaho insurance exchange. A ballot initiative passed in November would have made Idaho residents between 100 and 138 percent of the poverty line eligible for Medicaid.
But a fight in the Legislature this year resulted in state officials agreeing to ask the federal government for a waiver that would let Idaho require able-bodied adult Medicaid recipients to prove they are working, volunteering or training at least 20 hours a week; people who do not meet the work requirement would be removed from Medicaid for two months, after which they may reapply.
At this point, it’s unknown whether the work requirement will be implemented at all: a federal judge in March struck down similar requirements in Arkansas and Kentucky. In an interview with the Times-News last week, Gov. Brad Little said he believed there was “a fair possibility” that the federal government wouldn’t approve the requested waivers.
But if the work requirement does go into effect, its impact would likely be felt most in rural areas, said Brian Whitlock, president and CEO of the Idaho Hospital Association. Rural Idahoans, even those who are already working 20 hours a week, may face additional challenges when it comes to proving to the state with correct documentation that they are working, Whitlock noted. While Whitlock said he certainly expects rural hospitals to see savings under a Medicaid expansion that includes work requirements, it’s likely that hospitals won’t save as much as they would under a “clean” expansion — and at a time when 20 of the state’s 27 rural critical access hospitals are operating at a negative margin, every dollar counts.
“It’s been kind of a shifting target throughout the legislative session to try to figure out exactly how many people would be impacted [by work requirements] and what that impact would be relative to hospitals,” Whitlock said. “This will be one of those policy decisions that we won’t know the real impacts of until people apply and are deemed eligible and they begin to receive benefits. It’s hard to make accurate predictions.”
In 2017, Idaho’s hospitals administered roughly $294 million worth of uncompensated care to patients unable to pay for their treatment. Under a “clean” expansion without work requirements, the state’s hospitals would likely have seen an estimated $79 million reduction in uncompensated care, Whitlock said. It’s unknown what that number will be if work requirements are put in place.
Work requirements are the biggest concern of officials at Minidoka Memorial Hospital, a 25-bed critical access hospital in Rupert, according to chief financial officer Jason Gibbons. Gibbons said the hospital supports Medicaid expansion as originally voted on in the ballot initiative.
“The Legislature took it upon themselves to change the will of the people,” Gibbons said. “We’ll see how that plays out on the federal level.”
Minidoka Memorial Hospital officials say they’re ready to accept additional Medicaid patients, but aren’t expecting an influx.
“We don’t anticipate that there will be a large impact, at least for our facility,” Gibbons said. He said the hospital hasn’t done much preparation for Medicaid expansion.
Minidoka Memorial Hospital is “sitting very well” to handle any additional patients, Gibbons said, and has already expanded the number of medical providers at its clinic.
Currently, the biggest challenge for the hospital pre-Medicaid expansion is patients who don’t have health insurance and end up in the emergency room, Gibbons said, when they don’t have a physician managing their care on an ongoing basis.
Minidoka Memorial Hospital essentially absorbs that cost when patients can’t afford to pay their emergency room bill. “We’re writing off everything associated with that,” Gibbons said.
The hospital’s motivation behind supporting Medicaid expansion is for affected community members to have health insurance coverage, which will “provide better health outcomes than coming to the emergency room,” Gibbons said.
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At North Canyon Medical Center in Gooding — an 18-bed critical access hospital — chief executive officer Tim Powers said he doesn’t know how many people in the hospital’s service area fall within the Medicaid gap. But about 10-11 percent of the hospital’s patients already have Medicaid.
As for patient numbers or staffing, “I don’t think we’re going to see any significant variations in what we’re seeing right now,” Powers said.
The main difference, he said, is more people will be able to utilize Medicaid as their payer for medical bills instead of trying to cover the cost out-of-pocket: “I’m all for it,” he said.
Powers is a member of the board of directors for Idaho Hospital Association, which supported Medicaid expansion as passed in the ballot initiative. He also did presentations to communities in North Canyon’s service area to educate people on the proposal, how many people it would impact and “the humanitarian impact of having these types of dollars for health care,” he said.
Powers said he hears conversations between North Canyon employees and patients who are making financial arrangements for their medical bills. Some have high-deductible health insurance plans, with deductibles such as around $5,000, and are writing a check out of pocket to cover their bills up to that point.
“For people in that income bracket, that’s next to impossible,” Powers said.
North Canyon has a sliding fee scale and has accommodated patients who can’t afford to pay their medical bills. It also opened a walk-in clinic more than two years ago, which has kept more people out of the emergency room who don’t need that level of care.
People going to the emergency room and not being able to pay their bill, Powers said, is the biggest source of “bad debt” for the hospital.
Cassia Regional Hospital — a 25-bed critical access hospital in Burley — was unable to comment or provide a statement by deadline Friday.
Smaller clinics and practices across Idaho say they also expect to see more patients covered by Medicaid once expansion goes into effect.
“The ‘positive’ is that most of the gap population will now be covered, which should greatly lower the overall cost of healthcare for the state,” said Dr. Keith Davis, head physician at Shoshone Family Medical Center and the only primary care doctor in rural Lincoln County, in an email to the Times-News.
But Davis said he had concerns about new costs to the state that work requirements could create, in part because of the potential price tag attached to enforcing the work and reporting requirements and in part because he believes the potential for a “secondary gap” of non-working people will make it harder to eliminate county indigent funds and the state Catastrophic Health Care Fund, which go toward health care for those who cannot pay for it.
Idaho counties currently spend about $20 million per year on indigent health care, while the state spends roughly $20 million annually on the catastrophic fund. The Legislature plans to form an interim committee this year to study how Medicaid expansion will affect existing programs that serve medically indigent people.
Davis said he also worried about the cost of potential legal challenges to the state if the work requirements are implemented.
“Did we just set ourselves up by politics to spend money in legal fees that could have been spent on actual healthcare for those truly in need?” he wrote. “Yes, I believe we did.”
The region’s largest health care provider, St. Luke’s Magic Valley Medical Center, declined to comment for this story. Hospital spokeswoman Michelle Bartlome directed the Times-News to the Idaho Hospital Association, saying the group is the best source of information.
St. Luke’s Health System CEO Dr. David Pate wrote about Medicaid and its history in a February blog post. The challenge with Medicaid expansion will be the impact on the already-existing physician shortage, he wrote, but the hope is patients will be able to receive primary care services instead of utilizing expensive emergency room services for non-emergency conditions.
“As a physician, I have seen the consequences of being uninsured,” Pate wrote in his blog. “I have seen patients put off seeing physicians until it is so late that now they have expensive complications, as well as cases in which the patient waited so long that their once-curable condition is no longer curable.”