The federal government does not bail out struggling community hospitals. Only multi-billion Wall Street firms qualify for rescue plans, while Washington pays just a fraction of the cost of treating Medicare patients and those covered by federal insurance, such as Tricare for military members and their families.
Small community hospitals like North Metro Medical Center must write off millions of dollars a year for treating uninsured patients, whom the hospital cannot turn away when they show up for treatment. But why punish hospitals, especially those that are nonprofit, for providing health care to people who can’t afford it?
As the economy worsens, fewer patients can afford to pay their hospital bills. Competition from nearby hospitals, with deeper pockets and more affluent patients, has hurt North Metro.
It’s no wonder, then, that North Metro is reporting $3 million in annual losses. That’s a steep increase over the previous year’s loss of about $800,000.
The city-owned hospital is negotiating with Allegiance Health Management of Shreveport to take over the Jacksonville facility and perhaps offer different services that might help cut North Metro’s losses.
If Allegiance leases the hospital, it could specialize in long-term care but keep the emergency room open. Long-term care can mean more generous reimbursement from insurance companies and the government. But residents from Jacksonville and Lonoke County might have to drive farther for services that might not be available at North Metro, which has just closed its maternity ward.
The city has also negotiated with Baptist North in North Little Rock and St. Vincent North in Sherwood, but Allegiance appears to be the front-runner to take over the troubled hospital.
Large medical centers in Little Rock and North Little Rock are doing quite well with more generous reimbursements and patients who have quality health insurance, but the odds are against the smaller hospitals, with fewer insured patients and more competition and mounting debt. Medicare reimbursements are a problem nationwide — not just in Arkansas — because they are often lower than what private insurers will pay.
Doctors and hospital administrators fear the problem will worsen, and they support universal healthcare because hospitals are the ones caught holding the bag when it comes to serving patients who are unable to afford care but who make too much money to qualify for Medicaid.
The state can’t afford to subsidize community hospitals; there are so many small-town hospitals in trouble or that have already closed that only an infusion of local capital, such as new sales taxes, or new management with deep pockets, might give the hospitals a fighting chance. A Jacksonville sales tax could hardly cover mounting losses at North Metro.
There ought to be a federal solution before hundreds of community hospitals shut their doors nationwide.
