Proposed legislation that could have a “catastrophic effect” on health care delivery, especially in rural Indiana, will get a second reading on Monday before the Indiana Senate Health and Provider Services Committee at the Statehouse in Indianapolis.
Rob McLin, president and chief executive officer at Good Samaritan Hospital and the new chairman of the Indiana Hospital Association, says House Bill 1004 (http://iga.in.gov/legislative/2020/bills/house/1004) as it's currently written could cripple the ability of smaller, mostly rural hospitals to continue to provide services.
“They would just have to shut down,” he said. “They couldn't continue to operate if this bill became law as it's now written.
"It would just have a catastrophic effect on health care in rural Indiana."
And it wouldn't just be smaller hospitals that would be impacted.
Thom Cook, Good Samaritan's chief financial officer, said if it became law the bill would mean a $33 million loss for the hospital.
“And that would mean we would have to reduce services and cutback on just about all the outreach programs we do now — the Men's Health Tune-up for instance, that would have to go away,” he said. “Just about every outpatient service we now provide would be affected.”
Supporters of the legislation, such as state Sen. Eric Bassler, whose 39th District includes parts of Knox County and is a co-sponsor of the bill in the Senate, say it would help lower health-care costs.
But McLin is skeptical.
“This would be a windfall for the insurance companies such as Anthem,” he said. “They would continue to charge the premiums they can while not having to compensate hospitals as much for the care we provide.
“I mean, our staff at Good Samaritan does a tremendous job managing costs, but not even they could manage this kind of cut in our revenue.”
As it's written the bill would require all outpatient services to be reimbursed by insurance providers at a lower rate, regardless of whether that service is provided onsite at the hospital or at another location, such as Good Samaritan's radiology clinics in Bicknell and Monroe City or even the Medical Center of Vincennes on North First Street.
Last month, the hospital provided over 50,000 outpatient services throughout its network.
Cook said there would be no way the hospital could compensate for the loss of revenue should the legislation become law.
“We just couldn't absorb that kind of loss and maintain the level of services we're now providing,” he said. “We would have to start evaluating what to eliminate on day one.”
“Painful decisions would have to be made,” McLin said. “Quality of life in Knox County — throughout rural Indiana — would be greatly impacted.”
If passed and signed by the governor, the new law would take effect on July 1.
Cook said said the clinics would have to close, but so would departments within the hospital itself.
“It wouldn't just be cutting community outreach programs and closing clinics in Bicknell or Monroe City, we'd also likely have to close our radiology department here at the hospital,” he said. “And we'd have to look at the emergency room, plus we couldn't continue to operate speciality services such as [obstetrics] because we wouldn't have the revenue coming in to subsidize those.”
McLin said there is hope of an amendment to the bill that would limit the reduction to just those facilities that are off site. But even that could force changes in the hospital's operations.
“As near as we can tell, that would equate to a $700,000 loss of revenue for us,” Cook said. “That's certainly a lot better than $33 million, but we'd still be making some cuts to services.”
McLin said they have made their pitch against the bill to state Sen. Mark Messer, R-Jasper, the GOP majority leader, and state Rep. Bruce Borders, R-Jasonville, whose District 45 includes parts of Knox County including Vincennes.
There will be a press conference on Monday at the Statehouse at which McLin will be taking part.
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