News Blog

News Blog

County's Bridge Plan for Obamacare Faces Costly and Uncertain Future

The county's uninsured poor may have to wait until the Affordable Care Act, aka Obamacare, takes effect on January 1, 2014 to get health insurance.

Monterey County is one of eight California counties that's delayed implementing a bridge plan, or temporary coverage, for some of the poor uninsured patients who will be automatically eligible for expanded MediCal come 2014.

But now, that plan looks very risky, and may not be safe to implement at all, according to a memo dated Oct. 31.

County officials waited for the U.S. Supreme Court to rule, they waited for Salinas Valley Memorial Healthcare System to consider (then reject) a merger proposal from the county's safety net hospital, Natividad Medical Center, and now they're waiting on "a topic of grave concern"—cash flow.

On Oct. 23, the Board of Supervisors requested a written update from Natividad CEO Harry Weis and County Health Director Ray Bullick. Their report, to be discussed at Tuesday's board meeting, lays out the risks of an uncertain—and potentially quite costly—program, which they're calling ViaCare.

ViaCare would cover 1,000 to 1,500 uninsured county residents at or below the poverty line, at a total cost of $12-14 million. Before Obamacare kicks in fully in 2014, there's a 50-percent reimbursement, so the county would be on the hook for some $6-7 million.

However, according to the memo, there's concern about receiving that 50-percent payment at all: "New findings create material doubt about Natividad Medical Center receiving the $6 to 7 million in 'incremental' cash receipts."

Even if that cash flow comes through, county officials say they're worried about jeopardizing their ability to get ever-dwindling state funds in the future. Weis and Bullick recommend a dramatically scaled-down version of ViaCare, down to a $3.4 million program.

Public hospitals are accustomed to receiving pennies on the dollar back for providing medical care to the indigent and uninsured already. But that revenue dropped from $24 million/year to $12 million/year in just the past 18 months.

Those already plummeting revenues "will likely decrease further if [Natividad] starts a new Low-Income Health Program," the memo states. Those same public safety net dollars "will increase slightly if it doesn't start the Low-Income Health Program."

Natividad projects a $21 million loss on this year, just due to low reimbursement rates on the cost of care to uninsured and poor patients. Weis expects to be able to make up all or most of that loss from insured patients.

"Monterey County, as the smallest county in CA with a county hospital, does not have the financial ability to make these subsidies or take on the risk of loss for a new program of this type…Natividad is unable to take on the risk of a new Low-Income Health Program."

Representatives of the faith community in Communities Organized for Relational Power and workers in the Service Employees International Union have been pressing the board to approve a bridge plan and cover at least some of them before 2014. Natividad stresses that health care is already available to all, regardless of ability to pay.