Medical providers stand to gain under Blunt's plan

By DAVID A. LIEB
Associated Press Writer

JEFFERSON CITY, Mo. (AP) — Doctors and hospitals could gain financially under Gov. Matt Blunt’s new plan to subsidize private health insurance for lower-income Missourians.

Blunt said Wednesday that hospital officials played a key role in developing his “Insure Missouri” plan, which over the next five years is projected to gradually extend health care coverage to 189,787 people at an ultimate annual cost of $952 million.

Some of those people were cut two years ago from Missouri’s Medicaid program for the poor, when Blunt and the Republican-led Legislature tightened eligibility criteria to save money.

Blunt’s new plan essentially restores coverage for some of those adults. It does so under the auspices of private health insurance plans similar to the managed care plans already used for Medicaid recipients along the Interstate 70 corridor from St. Louis to Kansas City.

Doctors could gain because the payments they receive from the private health insurance plans would be higher than if Blunt had proposed to cover those patients under traditional Medicaid, which is now called Mo HealthNet under a law that took effect last month.

Hospitals could gain under Blunt’s plan because they would receive Medicaid equivalent payments for some patients who previously were uninsured.

Although the state currently compensates hospitals for treating people without insurance, hospitals typically net less than one-third of their charged costs in such cases, said Dwight Fine, senior vice president for governmental relations for the Missouri Hospital Association.

“(Medical) providers will like it, because it’s obviously beneficial to them,” Blunt said in an interview Wednesday while hosting newspaper editors at the Governor’s Mansion for an explanation of his initiative.

By subsidizing private insurers, Blunt said the plan also will be less costly for the state than if those patients been covered through traditional Medicaid. Of that $952 million cost in five years, for example, Blunt projects less than $47 million to come from the state’s general tax revenues, with the rest coming from federal funds and existing hospital taxes.

Hospitals already pay a special tax that is used to draw down federal Medicaid dollars. That money then is returned to the Medicaid program in general and to hospitals specifically to cover part of their costs of treating uninsured patients.

Under Blunt’s plan, $269 million of those hospital taxes would be diverted to the Insure Missouri program by 2012. That would mean less money to hospitals for the cost of treating the uninsured, but more money to them for patients who now would be insured.

If a hospital were to charge $1,000 for an emergency room visit by an uninsured patient, it might typically net $300 from the state, Fine said. But if that person were covered under Medicaid or Blunt’s new proposal, the hospital might recoup around $600, he said.

Doctors don’t have the same responsibility as some hospitals to treat patients without insurance. And doctors who see patients on Medicaid typically get about 55 percent of what they would receive under the federal Medicare program for the elderly.

Blunt said doctors participating in the Insure Missouri plan likely would be paid at rates similar to the Medicare level.

The Missouri State Medical Association, which represents physicians, has not decided whether to back Blunt’s proposal, said lobbyist Tom Holloway. He said it remains to be seen whether enough insurers and physicians would step forward to participate in it.

“There are a lot of question marks, but we in general support any effort to bring down the number of uninsured,” Holloway said, and “nothing’s worse than Medicaid” payment rates to doctors.

Beyond the benefit to medical providers, Blunt contends Missourians covered by private insurance also should benefit if his proposal reduces the number of the uninsured. That’s because hospitals and other medical providers typically charge more than their actual costs to try to recoup some of their uncovered costs attributable to the treating the uninsured.

Fine said the hospital association is backing the proposal for more than just the financial benefit it would deliver to hospitals.

“We do value letting this population have access to primary and preventative care,” he said. “That is probably the stronger motivating force.”

On the Net:

Insure Missouri: http://insuremissouri.org

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