by George Bischalaney
President & CEO, Eden Medical Center

National health care reform is now apparently right around the corner. After years of discussion, and more recently, weeks of debate in the House of Representatives, legislative action is now in the hands of the Senate. If enacted, it will be the most significant health care legislation in decades.

As a provider, it is both welcomed and feared. Welcomed in that it will help bring insurance to millions of people for whom it is now out of reach. In making this possible, it creates the possibility of opening doors for routine health care services that should help prevent late diagnosis of disease, which becomes problematic and costly to treat. From our perspective as a hospital provider, better access should redirect many people who use our emergency departments as their primary care providers.

But change comes with a cost. The mind-numbing price tag of reform is expected to be offset by future savings. In the short term, it will require shifting payments currently dedicated to the Medicare program.

Most hospital providers do not make a profit in caring for Medicare patients overall. There is no doubt that we need to drive inefficiencies out of the health care system in order to help address this issue. But that alone may not do it. When costs are rising at a rate of 4-8 percent per year and reimbursement is 3 percent or less, we are constantly falling behind. There are many reasons for escalating costs. Consider the constant introduction of new drugs, high tech and high-cost diagnostic and therapeutic equipment, and of course labor. Health care is a service business and 60% of hospital costs can be tied to salaries and benefits. The cost escalation of these items alone will keep us chasing the elusive break-even point. And once there, if achieved, there is still ongoing capital investment that is necessary to maintain the capabilities expected of community hospitals.

The final package is likely still months away. Even then, it will take time to analyze and truly understand the effects, positive and negative, of this landmark movement. We hope that the final outcome will have the proper balance, consider as much as possible all the consequences, and result in a healthier and more stable provider system.

I welcome your feedback.