Mary Washington Hospital Executive Says Supreme Court Decision Neither Good Nor Bad For Hospitals
Fred M. Rankin said the political side to the Supreme Court's decision will rage on for years and the ruling doesn't really settle questions about the future of health insurance reform.
Fred M. Rankin III, president and chief executive officer of Mary Washington Healthcare, said today's Supreme Court decision to uphold the Affordable Care Act is neither good nor bad for hospitals and does little to settle questions about the future of health insurance reform from a political perspective.
The biggest part of the decision was upholding the mandate that all Americans buy health insurance or they could be fined, which is expected to go into effect in 2014. Five justices did not vote in favor of allowing Congress to regulate commerce between states to require everyone to buy insurance, but five of them did approve a provision that the penalty people will have to pay for refusing to get insurance is similar to a tax that Congress can enforce.
"I wouldn't label it good or bad," Rankin said. "It impacts hospitals, but I think it is too early for me to tell if it is good or bad. It certainly has the potential long-term of increasing utilization because there are lots of people who don't have coverage today that when the law is fully impacted will now have access to coverage. So, it could drive up utilization. That's not necessarily a good thing because it gets to the real issue for us which is the overall cost of care being provided."
A positive for hospitals, Rankin said, is that for the first time all hospitals will get some kind of reimbursement for providing care to people with this form of coverage.
"Now, it is not terrific reimbursement because it will be at Medicaid rates, and Medicaid is not a great paying insurance, but right now the hospitals are getting nothing for (uninsured patients) so something is better than nothing," he said.
The Fredericksburg area has three hospitals—Mary Washington Hospital, Stafford Hospital and HCA's Spotsylvania Regional Medical Center—and Rankin said all three are not being fully utilized. But there is the potential that with a flood of newly insured residents in the region that it could overwhelm the hospitals, but that is hard to tell right now.
However, from the political side, the ruling does very little to settle questions about the future of health insurance reform, Rankin said.
"With the mandate being upheld on the theory it is a tax and the theory that Congress has the ability to tax, Congress can also curtail taxes," he said. "It will certainly be, in my opinion, one of the dominate themes of the presidential election and I suspect in a lot of congressional elections across the country."
President Barack Obama supporters will argue that this is signature, landmark legislation that got the stamp of approval from the Supreme Court and it's good for the country. But if Mitt Romney is elected, he could introduce legislation to have Congress repeal the law.
"I think this debate will rage for years to come," Rankin said. "And, what I just said about impacts on hospitals, all bets are off if the law would be repealed. So, from a political perspective, it doesn't settle anything."