Via Christi said it is losing nearly $14 million a year as a result of the state’s decision not to expand Medicaid.
The hospital is joining with other medical groups in an effort to push the state to expand eligibility for the federal and state insurance program for people with low incomes or who are disabled.
As part of that push, the hospital released an update Wednesday on its finances saying it lost $14 million in both 2013 and 2014 because Medicaid was not expanded.
So far this fiscal year, which started July 1, Via Christi said it’s behind budget by $3.3 million, reaching $2.8 million of its $6.1 million target for two months.
Jeff Korsmo, president and CEO, said Via Christi has not yet estimated its full projected loss for this year, but he expects it to fall in line with losses over the past two years.
Korsmo said Via Christi leadership met last week for a monthly briefing about financial and quality performance. The meeting marked the second month of low financial performance after a year of financial shortcomings.
“In the last week or so, we started rolling up our sleeves hard on this,” he said.
Via Christi and other health care organizations formed a coalition to urge Gov. Sam Brownback and the Legislature to expand Medicaid next year. The coalition includes Wesley Healthcare, the University of Kansas Hospital, St. Luke’s Health System, the Kansas Health Foundation and the Kansas Hospital Association.
The coalition will hold an educational meeting Nov. 3 for state politicians. Politicians and health care professionals from Indiana will be at the meeting to talk about how Indiana, a Republican-controlled state, garnered the political will to expand Medicaid, which is called KanCare in Kansas.
“We don’t have to reinvent the wheel,” said Cindy Samuelson, spokesperson for the Kansas Hospital Association. “We can look at what has worked for other states and educate our state about it.”
Invitations for the Nov. 3 event, which will be at the Kansas Leadership Center in Wichita, will likely go out in early October.
Samuelson said Medicaid expansion would not only increase access to care, but would also strengthen the state’s economy and preserve jobs.
The larger picture
In general, states that did not expand Medicaid have a higher rate of uninsured residents and slower drops in uninsured rates than the rest of the country.
Kansas is one of 19 states that did not expand the health insurance program.
The federal government reduced reimbursement rates through the Affordable Care Act, also called Obamacare, with the intention that all states would expand Medicaid eligibility to cover more low-income residents. A Supreme Court decision then allowed each state to dictate its expansion.
Brownback held firm on his disinterest in expanding Medicaid as recently as last week.
He and many other state politicians blame the Affordable Care Act for financial health care struggles across the state rather than the decision not to expand Medicaid.
The Kansas Hospital Association contradicts that.
Hospitals in Kansas lost $137 million as a result of lower reimbursement rates under the Affordable Care Act. Expanding Medicaid would lower that number to just below $9 million, according to a Kansas Hospital Association 2015 impact report.
The announcement of a hospital closure in Independence points to what hospital leaders say are the larger effects on hospitals around the state, in part for not expanding Medicaid.
According to an April article by Becker’s Hospital CFO, a trade publication, as many as 15 Kansas hospitals are struggling to keep their doors open.
In a written statement, Matt Leary, chief financial officer for Wesley Healthcare, said Wesley also endured financial impacts from not expanding Medicaid, but he declined to offer specific numbers.
In a news release Wednesday, Korsmo, of Via Christi, outlined some changes Via Christi has made because it is $3.3 million behind schedule on its budget.
▪ Reducing 110 full-time positions through attrition over the past 18 months.
▪ Scaling back spending on projects that aren’t significantly underway.
▪ Halting all discretionary spending for travel, education, meetings or other similar costs.
He talked about the plans over the phone Wednesday as he awaited a flight to St. Louis for a monthly leadership meeting with Ascension Health, Via Christi’s parent company. He said Ascension paid for the travel.
In total, Via Christi said it has absorbed more than $25 million due to lower reimbursement rates each year since 2013. That number includes cuts from government insurance programs and private insurance.