Media Statement

CHA Commends President for Advancing Health Care Reform, Hospitals Concerned About Funding Proposal

California’s hospitals, which have long supported the goal of comprehensive health care reform, commend President Obama for making health reform a top priority in his proposed FY 2010 budget. The President’s announcement parallels CHA’s vision of “an optimally healthy society.”

The California Hospital Association (CHA) is concerned, however, about some of the Administration’s proposals to fund reforms to our health care system. We are concerned about billions of Medicare dollars being cut from hospitals when hospitals face unprecedented challenges during these difficult economic times. A recent CHA survey indicates that 33 percent of California hospitals have experienced an increase in uninsured patients seeking emergency care, while 73 percent of hospitals have seen a rise in the number of patients having difficulty in paying out-of-pocket costs.

While aligning financial incentives towards quality of care and reducing inefficiencies in the Medicare and Medicaid programs are worthwhile goals, the devil of these proposals is in the details. For example, not all hospital readmissions are preventable. Determining when a patient should be re-admitted to a hospital is a decision that should be left up to a patient’s physician, rather than through arbitrary policies dictated by the federal government.

It also is important to note that both the Medicare and Medi-Cal (Medicaid) programs currently pay hospitals significantly less than the cost of providing care. In 2008 alone, the Medicare payment shortfall (the amount paid that is less than actual costs) to California hospitals exceeds $3.5 billion.

CHA looks forward to working with the Obama Administration and Congress to begin reforming our nation’s health care system, while at the same time ensuring that local community hospitals remain financially viable and available to their patients.