State revenues are clearly in the tank. But Bill Walczak, CEO, Codman Square Health Center worries that none of the gubernatorial candidates will address the shortfall in earnest because they’re afraid of violating their own no-new-taxes mantra:
Be afraid. Be very afraid.
A Massachusetts Taxpayers Foundation report on State and Local Finances concludes that tax revenues have been sinking like a stone (a $2.62 billion reduction in tax revenue from FY08-09), with a FY09 $4 billion budget gap that was mostly filled by using the rainy day fund, stimulus dollars and other one-time funding sources. Rainy day funds now stand at under $800 million, as FY10 continues the financial slide. We entered FY10 with a $4.8 billion structural deficit, filled by $2 billion in spending cuts, more use of stimulus dollars and further spending down of the rainy day fund, along with the increase in the sales tax. Even this is not enough. We’ve all been told to expect 9C cuts (the cuts governors are required to make if tax revenues don’t keep up with budget projections) later this month, due to continuing tax revenue declines.
But what is even more frightening is MTF projections on FY11. With even fewer rainy day and stimulus dollars available, MTF forecasts a $2.775 billion deficit.
So, coming into next spring’s state budget season, what can we expect? We’ll have arrived in gubernatorial election season, and with Massachusetts having joined New Hampshire with gubernatorial candidates all taking the “pledge” of no new taxes, we’ll have Mihos, Cahill and Baker all talking about how they’ll cut taxes and how they’ll find waste, fraud and abuse to make up the difference, positioning Gov. Patrick to also be against new taxes. Read more…
About a dozen years ago, there was a significant segment of the health care system that believed that the future of health care was going to change to be a system in which primary care providers held the key to all other services, with primary care “gatekeepers” managing the care of “covered lives” (i.e., patients) and ensuring lower cost, higher quality services. This group believed that insurance companies really just wanted to make money, and didn’t want to be in the business of determining what and how much health care would be allowed. So why not just turn the decision making (and a set dollar figure per patient) over to doctors and let them take the risks (and gain the rewards by managing care) with the insurance companies taking their share off the top?
Sound familiar?
In the 90’s, the system that is now being called a “global payment system” was largely represented in what was called “capitated managed care.” It required a transference of power from hospitals and specialists to primary care providers, and required primary care systems to invest in lots of technology and support services to effectively manage care and cut down on cost while ensuring quality care.
The problem with this type of system was manifold. Read more…
When community health centers were first introduced to the United States (the first in the U.S. was in Dorchester in 1965), they were created to deal with a health care system that didn’t meet the needs of the millions of low income people who increasingly made up American cities as the suburbs drew the middle and working classes out of them. To use my own health center community as an example, by the 1970s, there were still private physicians practicing in Codman Square, but the new residents, who were mainly African Americans largely uninsured or covered by Medicaid, were not welcome in most of those offices. Most of the doctors had closed their practices to new patients or refused to take new customers on Medicaid (and nearly all left the community by 1980). So the new residents had no place to go for services except the emergency rooms of local hospitals, which was considered very inefficient and costly, and bad care.
The Boston Department of Health and Hospitals, under enlightened leadership from people like Lewis Pollock, encouraged communities to start their own health centers. In addition, a number of urban hospitals, through the encouragement of the Sackett Plan (named for previous Health and Hospitals Commissioner Andrew Sackett), worked with community groups to help them start health centers. Availability of federal funding also encouraged the formation of health centers. Eventually 28 health centers were created in Boston (26 remain). Because of these different methods of formation, three different types of health centers emerged, all providing similar medical services but with different funding models. Read more…
Codman Square Health Center has taken a number of financial hits this year. We started off the fiscal year in October with about $200,000 in cuts from a safety net program that was eliminated from the budget. We took another hit with the Governor’s 9C cuts in October. Just prior to writing this blog, I opened yet another envelope from the Department of Public Health containing a contract amendment reducing a grant for at risk women and adolescents from $90,000 to $76,500 for this fiscal year. Among other expenses, the grant supports a registered nurse who performs case management duties for pregnant women and girls. We have already received other reduction letters, and, combined with the expected lowering of reimbursement through cuts in Medicaid managed care, we are looking at about $250,000 – $300,000 in cuts from October’s 9C budget reductions. This is forcing managers at Codman Square to scramble to find new ways to increase revenue or reduce cost amounting to a combined total of $500,000 just to break even on a cash basis (meaning we would show an operating loss of nearly a million dollars, but it would be mainly from not funding depreciation).
This brings us to our 1400 problem. Read more…
For the purposes of this blog, the first thing you should know about Codman Square Health Center is that it is a good location from which to look at the effects of health reform. An area with a very large low income and working poor population, we have had as many as 49% of the 21,000 individuals we see annually among the ranks of the uninsured. This was in the year before health reform was implemented.
Health reform is a very big deal to Codman Square. The impact of it on our patients has a huge impact on our finances and therefore the level of services we’re able to provide to our community. And so we study the numbers that come out of our computers monthly to see trends. The numbers our computers give us monthly point in a number of directions.
Here are some items from our data:
• The number of uninsured is way down – from 49% of patients two years ago to 14% today. Much of that change happened during 2007 and up to March of this year. The overall number of uninsured has been stable since March, 2008. About 2/3 of the uninsured are covered by the Health Safety Net, formerly known as the Free Care Pool.
• Access to insurance seems to have translated into more use of health services. We’re seeing increased demand, about a 10% increase in visits, such that our waiting time for appointments has increased to 3-4 weeks for many services.
• Bad Debt is up over 50% from last year, which was up over the previous year.
• Patients having Commonwealth Care insurance fluctuate up and down, but overall the number is flat since January.
So what does it all mean? Most important, many more people have insurance, and the patients who have this new insurance certainly seem to appreciate it and are using it. But it is also true that it is, as has been pointed out, a “near” universal system. Read more…
Over the years, I’ve come to realize that very few people really understand the health care system, and this includes legislators and members of congress who vote on changes to this system. It also includes our presidential candidates, and I’ve watched the presidential primary process with amazement at both the lack of understanding and the plans that have emerged to “fix” health care.
The democratic debate for the final two candidates comes down to whether you believe in an “individual mandate,” i.e., requiring individuals to purchase health insurance if they don’t have it through their employer, or if they’re self employed. Clinton’s plan calls for one; Obama’s doesn’t.
In our Massachusetts system, I’ve had a problem with the “individual mandate” in health reform since the legislature dropped a “business mandate” (i.e., requiring businesses to provide health insurance) provision before passing the law. This, combined with the state adopting a methodology for determining insurance rates that punishes you as you get older, can result in the state enforcing a rule that will cause bankruptcy or severe financial hardship for many residents. Read more…
In a previous blog entry, I asked whatever happened to community rating for insurance. For those of you who don’t know, community rating was the system in place for most medical insurance companies in which most people had similar insurance premiums, because the risk was shared among the entire population of insured people.
Community rating has all but disappeared in the private insurance market, but what is still somewhat surprising to me is that the Commonwealth of Massachusetts also abandoned community rating in setting up the insurance system for Commonwealth Care and Commonwealth Choice insurance plans.
This decision allowed the governor to state last year that it was possible for an individual to get medical insurance for $170 per month. The fine print, however, was that this was the insurance premium for a 38 year old man, and the $170 doesn’t include the cost of deductibles and co-payments.
What it also doesn’t say is that the effort to keep the cost down for 38 year olds results in extremely high rates for those in riskier categories, meaning anyone over 38. Just how expensive, you ask?
A class from UMass Boston Nursing School recently visited me to discuss community health. One of the students happened to have with her a previous assignment, which was to find out what kind of insurance was available for an uninsured person in the new health care system. She used information for a 58 year old single female from Fall River, working as a nurse’s aide and making $32,000 per year, which is above the annual income that would qualify her for subsidized insurance. The options were eye opening. Read more…
We knew the easy part of health reform was going to be the first part – giving free health insurance to people formerly covered by the free care pool who are very poor. As you might expect, this has been a big success.
We knew that the second phase – covering individuals above 150% of poverty by having them purchase health insurance offered through the Connector – was going to be more difficult, but the difficulty would be the issue of whether people who are required to pay for insurance would actually buy it, and, more important, if those who don’t have health problems would actually buy health insurance, thereby subsidizing the cost of those who need medical care. The jury is still out on this.
We are now entering the third phase of health reform. And this may be the most difficult part (except maybe figuring how to pay for this very expensive system after it’s fully implemented). It involves the redeployment of a much smaller Free Care Pool, now called the Health Safety Net, but I’ll still call it the Pool for old time’s sake. This was the subject of much political lobbying, and the end result has winners and losers. First off, the losers…
The medical care system is not easy to understand. There are hundreds of different payers for care given to individuals – insurance companies, government, unions – all with different rules for paying and limits on what they’ll pay for. They have different methods for determining what is reasonable for them to pay for visits, lab tests, procedures, surgeries, etc., and they have different expectations on what will be written off by the provider or paid for by the patient. For those without insurance in Massachusetts, there was, and still is for some, the so-called “free care pool” for those who are poor enough to qualify for it, and there are significant out-of-pocket expenses for those above that level of income. There are also out-of-pocket expenses for most insured people, in the form of copayments, deductibles and non-covered services. Read more…
The first thing I want to say in this edition of my blog is that my earlier entry produced some very negative comments from some good people that I’m generally on the same side with on issues dealing with health care for poor and working class people. It seems that questioning the impact of Chapter 58 on the poor has become the equivalent of wanting to destroy Chapter 58 to some advocates who worked so hard to pass it. So, not that it matters, but let me say that I’ve spent over 30 years trying to get the poor and working poor access to care, and I do not mean to have my questioning of Chapter 58 indicate that I’m not in favor of providing insurance for everyone, or that I think Chapter 58 is a failure, or cannot be changed sufficiently to ensure this is done. My questions on Chapter 58 are to make sure that someone is asking questions about the impact of Chapter 58 on the working poor, who are the large majority of patients at the Codman Square Health Center. Read more…