Last week, an Amtrak train wrecked in Halifax County and sent more than 50 people to Halifax Regional Medical Center for emergency care. As always, when there is a disaster, North Carolina hospitals are there to treat the injured, support families and bring order to a chaotic situation. Halifax Regional Medical Center, Nash General Hospital and Vidant Medical Center were prepared for this disaster. It is every hospital’s mission to always be prepared to respond and react in emergencies. Hospitals respond without any assurance of payment. We budget every day for additional staff, supplies and equipment needed for unexpected emergency situations.
All North Carolinians deserve to have access to high quality, cost-effective health care when they need it. Legislation recently introduced to exempt certain specialty centers from the state’s Certificate of Need law threatens to undermine access for all. Critics of CON have claimed that the law is restricting health care in North Carolina and that our residents are losing out on access to newer and potentially more affordable medical care. As a longtime hospital administrator, I find these claims inaccurate and misleading.
Opponents of the CON law claim that without regulation, a free market would lower health care costs. Yet the study they use to support their stance suggests that our state needs an additional 13,000 hospital beds to increase access to care. Health systems of tomorrow will be more about keeping patients healthy and out of the hospital than about adding beds. Already, 42 percent of licensed beds in North Carolina are empty on any given day. Without regulation to assess community need, simply adding more empty beds duplicates existing services and will increase the cost of health care without improving access.
Even without CON, the sheer number of federal and state regulations
on hospital-based care makes the concept of a free market impossible. Government payers like Medicare and Medicaid are responsible for two-thirds of all hospital patients but don’t compensate hospitals for the actual cost of care. Hospital payment rates set by government are nonnegotiable, often less than 60 percent of actual costs.
Nonhospital providers have the option of turning away patients who are uninsured and underinsured, such as those who rely on Medicaid. Those who would like to see CON weakened or repealed aren’t seeking to provide emergency care or to stay open 24 hours a day to respond to disasters. Under current regulations, they are not required to provide care for the uninsured patient.
A provision in the proposed legislation sets a goal for the amount of charity care a single-specialty center should provide. But that hardly equates to the overall community benefit from a hospital. State and federal standards recognize that community benefit includes not just charity care but losses sustained from Medicare, Medicaid, bad debt, teaching programs, research and donations to the community. Last year, N.C. hospitals provided more than $1.8 billion in uncompensated care, including charity care as well as unpaid co-pays and deductibles and services not covered by insurance. Many N.C. hospitals already operate in the red, and one-third have margins between zero and 5 percent.
Hospitals are trusted providers in our communities, with long-term commitments to infrastructure, employment and, most importantly, to the patients we serve. We are working every day to control costs and improve patient outcomes for all who depend on us. State lawmakers must not surrender to entrepreneurs working to take profitable services away from hospitals, leaving them to care for the emergencies and the uninsured.
North Carolinians can have freestanding specialty centers or they can have hospitals, but they can’t have both.
William Mahone is president and CEO of Halifax Regional Medical Center in Roanoke Rapids.