Montgomery County hospitals still don’t know what the full impact of the federal sequestration cuts will be, but area doctors in private practice may already feel the burn, according to a physicians’ advocate.
The 2 percent cut in Medicare payments, scheduled to take effect April 1, means doctors will have to decide whether to take fewer Medicare patients or to just absorb the costs, said Gene M. Ransom, CEO of MedChi, the Maryland State Medical Society. “Those are really the only choices.”
The sequester also poses a risk to public health, particularly in areas, like Montgomery County, that have a high number of federal employees and contractors, Ransom said.
“If you’re being furloughed for a few days, you’re more likely to skip an appointment or postpone surgery,” he said. “People make decisions based on how much money they have.”
Problems left untreated can send patients to the emergency room, which ultimately leads to higher health costs, Ransom said.
Since Maryland hospitals aren’t allowed to make changes to their rates, the five Montgomery facilities are waiting for instructions from the state before deciding how to deal with the reduced revenue.
Last week’s anticipated snowstorm cancelled a March 6 meeting of the state’s Health Services Cost Review Commission, which sets the rates of Maryland’s hospitals. At that meeting, the commission was scheduled to discuss how to respond to the sequester.
The next meeting is scheduled for April 10, but the commission may convene sooner to discuss the matter, said Steve Ports, the group’s principal deputy director.
With potential rate changes still up in the air, county hospitals and health services are in a holding pattern, unsure how to plan for the future, officials said.
Hospitals are likely to do everything they can to keep cuts from affecting patient care, said Jim Reiter, spokesman for the Maryland Hospital Association, which advocates for the state’s hospitals. But that means some additional services — smoking cessation programs, for example — could be offered less frequently or scrapped altogether, he said.
Not knowing how rates will be effected makes it difficult for hospitals to plan more than a short time in advance, Reiter said.
“It’s a great cloud of uncertainty,” compounded, he said, by the fact that hospital rates, as far as MHA is concerned, haven’t kept pace with inflation.
Three options likely to be considered by the cost-review commission include passing on all costs to payers, which could increase hospital rates by 0.83 percent; splitting the cost evenly between payers and hospitals, which could raise rates by 0.41 percent; or holding payers harmless, meaning the rates would stay the same and the hospitals would have to make cuts to cover the difference.
The MHA’s preferred option would be to pass the cuts on to payers, as hospitals in other states are free to do, Reiter said.
Maryland hospitals, however, don’t get to make that decision; the cost-review commission makes it for them. County hospital officials are reluctant to speculate about the possible impact to hospital services until the commission takes action.
Montgomery County’s Department of Health and Human Services has been told by the state Department of Health and Mental Hygiene to expect cuts of 5 percent, 10 percent or 15 percent to federally funded grants administered by the state, said spokeswoman Mary Anderson.
But the county hasn’t given more specific estimates or told how long those cuts — which could affect some children’s health insurance, prenatal care and cancer screening programs — are anticipated to last, Anderson said.
“We’re hoping to hear more by month’s end,” she said. “Really, we don’t know anything yet.”