Joseph Rugg's Health Law Blog

Supporters of the PPACA cannot deny that implementation of the sweeping reforms will be a daunting task that may, ultimately, fail. Many critics of “Obamacare,” however, have provided no realistic alternatives to bending an unsustainable healthcare cost curve beyond vaguely worded demands for vouchers, block grants, and buying health insurance across state lines.

One reason why the American Hospital Association and other hospital groups supported the PPACA was because of its pledge to expand health insurance to tens of millions of people now uncovered, including dependent children age 26 or younger. But as Moody’s Healthcare Quarterly pointed out this month, that new revenue source for not-for-profit hospitals will be offset by Medicare reductions of $150 billion over the next 10 years, along with an additional $14 billion in Medicaid disproportionate share payments.

In addition, PPACA imposes new payment models that include lower reimbursements for hospitals with high readmissions and low patient satisfaction scores, and the effect of those is still unknown.

A study in the Archives of Internal Medicine estimates that safety net hospitals will take an additional hit on reimbursements because Medicaid patients tend to distrust the healthcare system and that distrust is reflected in their lower patient satisfaction scores.

Private payers will follow the government’s lead and suffer less tolerance for cost-shifting, preventable errors and other quality issues.

As a result, Moody’s deemed “credit neutral” the U.S. Supreme Court’s ruling in June that PPACA is constitutional. The rating agency said the high court’s decision would have no effect on a negative outlook for the not-for-profit hospital sector.

See on www.healthleadersmedia.com

For an aggregation of other articles on Hot Topics in Healthcare Law, go to my magazine on Scoop.it – Hot Topics in Healthcare Law and Regulation and my newspaper on Paper.li – Hot Topics in Healthcare Law.