Options for reducing the deficit

Hospitals could be hit hard financially over the next decade if the option of an imposed cap on federal spending for Medicaid was chosen from a list of the options in the “Options for Reducing the Deficit: 2017 to 2026” provided by the Congressional Budget Office of the United States. Hospitals all over the United States receive a good portion of their income from individuals who rely on programs such as Medicaid and Medicare especially the safety net hospitals. Not only would Medicaid be affected by this cap, but Medicare would also be affected by this cap placed on federal spending for Medicaid which would, in turn, hurt hospitals even more.

In an evaluation of what this cap would do to the hospital here, it has been found that it would cause many cut backs, deficits, or even cause a lot of uncertainty throughout the state as well as the hospital's upper management. Many families that have loved ones in nursing homes might have to cut back and figure out ways to keep their family members at home with these caps because such a change would affect these people since Medicaid picks up the bill for whatever expenses Medicare does not cover when it comes to nursing home care (Jacobson, 2017). Many hospitals would also see more deficits brought on by the increase in uncompensated care which is treatment or service not paid for by an insurer or patient (Haught, 2017). Between the District of Columbia and the 31 states that expanded Medicaid they both are projected to see an increase in uncompensated care from 2017 to 2026 which amounts to a 78 percent increase (Haught, 2017). Not only that 11 of those states are expected to see a least double the increase in percent of uncompensated care between the years of 2017 to 2026 (Haught, 2017). Deficits will also be seen in hospitals due to a decline in Medicaid revenues which show the Medicaid expansion states experiencing a 14 percent drop in their Medicaid revenues (Haught, 2017). When it comes to uncertainty choosing this cap would bring out a lot of this. When states decide to plan for future budgets it would create a lot of uncertainty for the states because it would be hard to predict whether their Medicaid spending would exceed those caps or not (University of Phoenix, 2016). If the Medicaid spending by the states would exceed the caps installed this would require additional state spending so this situation would cause a lot of uncertainty.

Some proposed changes to the facility I would suggest helping curb these negative effects of this imposed cap on federal spending for Medicaid are changes to case management, putting an emphasis on going after more private insured patients, an emphasis on keeping the privately insured patients the hospital already has as well as new ones obtained and create a value assessment team. I would suggest that the hospital works to implement an improved case management side of the hospital to help cut down on the length of stays for patients (Medicare and Medicaid, 2010). If the hospital can cut down on the length of stay, this will help to cut down on expenses where the money saved can be used to offset the deficit of the Medicaid cap. When it comes to private insurance patients I would suggest getting the hospital to move towards marketing to the individuals more as to acquire more of them as patients because private insurance pays more when it comes to healthcare services. If the hospital can create a way to obtain more private insurance payors as well to keep them on a continuous basis the private insurance could fill in the gaps that limited public resources could not cover (Pauly, Zweifel, Scheffler, Preker & Bassett, 2006). Lastly, I would suggest creating a value assessment team where they could look at all the services provided making sure that the value outweighs the costs of the service (Becker's Healthcare, 2012). This assessment team could also show the value in the hospital reducing readmissions, infections and falls (Becker's Healthcare, 2012). When you look at all the value assessment team could do it would show that the value assessment team would save the hospital hundreds of thousands of dollars making this change well worth it. (Becker's Healthcare, 2012).

Overall, when taking into consideration this option provided by the Congressional Budget Office, I would hope that they choose to not go with this option as it could affect many people in a negative way. This option could potentially cause many people that rely on Medicaid to go without the coverage that is needed. Not only all this it would cause many feelings of uncertainty throughout the hospital's administration. However, if this option does get implemented, I have listed a few proposed changes to help curb the negative effects that would be brought on by this option.












References

Becker's Healthcare. (2012). How should hospitals work around Medicaid payment cuts this year? Retrieved from https://www.beckershospitalreview.com/finance/how-should-hospitals-work-around-medicaid-payment-cuts-this-year.html

Haught, R. (2017). How the American health care act changes to Medicaid will affect hospital finances in every state. Retrieved from https://www.commonwealthfund.org/blog/2017/how-american-health-care-acts-changes-medicaid-will-affect-hospital-finances-every-state

Jacobson, G. (2017). What could a Medicaid per capita cap mean for low-income people on Medicare? Retrieved from https://www.kff.org/medicare/issue-brief/what-could-a-medicaid-per-capita-cap-mean-for-low-income-people-on-medicare/

Medicare and Medicaid; solution that facilitates physician-executive communications, addresses healthcare reform challenges now available to hospitals nationwide. (2010, Sep 08). Healthcare Finance Tax & Law Weekly Retrieved from https://search-proquest-com.contentproxy.phoenix.edu/docview/749213298?accountid=134061

Pauly, M. V., Zweifel, P., Scheffler, R. M., Preker, A. S., & Bassett, M. (2006). Private health insurance in developing countries. Health Affairs, 25(2), 369-79. Retrieved from https://search-proquest-com.contentproxy.phoenix.edu/docview/204502682?accountid=134061

University of Phoenix. (2016). Options for reducing the deficit 2017 to 2026. Retrieved from University of Phoenix, MHA/516 website.