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UMC Faces Uncertainty Over Uncertain Future of ACA

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Bill Hughes

University Medical Center has been in the red for years until the Affordable Care Act expanded Medicaid coverage.

A few months ago, the Clark County Commission approved a request by the University Medical Center to spend $24 million on a new patient records system.

It was an easy decision, commissioner Steve Sisolak pointed out, because the county had to make no capital expenditure for it.

UMC was paying the entire $24 million cost itself.

The explanation was simple: UMC is making money. But how much of that revenue is due to the implementation of the Affordable Care Act otherwise known as Obamacare – specifically the Medicaid expansion?

And, more to the point, what happens to UMC if the ACA goes away?

UMC CEO Mason Van Houweling says about a third of his hospital's recovery from near bankruptcy is because of ACA and the Medicaid expansion.

Because of the health care law, the hospital - and all hospitals around the country - have been able to invest in capital improvements, innovation, clinical trials and research.

ACA money has also helped reduce the cost of care for all patients, because the hospital can write off less money for indigent patients.

That all might be in jeopardy.

But while Van Houweling is preparing, he's not too worried.

Republicans in Congress have been signaling that their goal is to repeal the ACA right away, then delay while they figure out a plan to replace it with. Van Houweling said the experts he's talking to say that new plan could be in place by 2019.

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In the interim, though, there are two scenarios: first: The ACA gets repealed and people suddenly have not coverage and money owed in Medicaid reimbursements goes unpaid; or second: The ACA gets repealed and people go on with their current coverage until Congress figures out a replacement.

Van Houweling comes down on the side of No. 2: that things will go along as they are now until a replacement is enacted.

Ironically, he pointed out, the possible extinction of the health care law is spurring more people, not fewer, to sign up for both Medicaid and the exchanges.

"Before the Affordable Care Act we had about a 21 percent uninsured rate in the state. We're down to about 11 percent. Best predictions is going to be about 9 percent" in 2017, Van Houweling said.

He thinks the most likely scenario is that Congress will adopt a version of Paul Ryan's "A Better Way" plan, which would not eliminate Medicaid money, but would give it to states in block grants. Currently, states are reimbursed at 100 percent for Medicaid spending.

Van Houweling could not put a number on how much a block grant would have to be in order to keep Nevada's Medicaid program from being cut.

Before the Medicaid expansion, UMC was reimbursed by the Clark County Indigent Fund. Van Houweling said he and his colleagues are keeping in touch with the County Commission about "potential impacts in our state."

Guests

Mason Van Houweling, CEO, University Medical Center

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