Georgia hospitals see change, crisis

Friday, Aug 1, 2014 8:59 AM
Last updated 7:51 PM
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ATLANTA -- The financial turmoil rocking Georgia’s hospitals shows no signs of fading.

Just this week, Emory-Adventist Hospital announced it would close by the end of October. By doing so, the Smyrna hospital would become the fifth Georgia hospital to close within the past two years. And unlike the previous four, it is in the affluent Atlanta suburbs, not a struggling rural area.

Emory-Adventist officials said Wednesday that the hospital “is no longer sustainable in today’s dramatically changed health care environment.’’

Other hospitals in better financial shape are seeking to position themselves for tough times ahead. Some are partnering with other health systems, seeking to broaden their services and increase their scale.

Why all the activity?

Hospitals across the state and nation are being squeezed by several major factors, including lower reimbursements from insurers, fewer inpatient visits, and more pressure to update their technology, including information technology, said Tom Sims, a health care consultant with Stroudwater Associates.

“For health care executives, it is a perfect storm of margin pressures, additional regulatory oversight and reductions in inpatient demand,’’ added Chris Kane, an Atlanta-based health care consultant.

The affiliation trend among hospitals has accelerated this summer. Southeast Georgia Health System in Brunswick, for example, is considering an affiliation agreement with two Florida systems, Flagler Hospital of St. Augustine and Baptist Health.

“In the current health care environment, it is important for all health organizations to look for opportunities to enhance the quality of patient care, position for population health and strengthen financial stability,’’ said Southeast Georgia President and CEO Gary Colberg in an email Thursday to GHN. “By sharing best practices and exploring the efficiencies of scale, we believe we can achieve those goals while preserving our local community focus.”

Colberg added that Southeast Georgia Health System has cut costs and implemented other measures that have boosted its financial performance.

It’s also reorganizing as a private nonprofit to operate its hospitals in Brunswick and St. Marys and other health facilities. That would pave the way for a possible affiliation or joint venture.

Kane said that as such hospital partnerships evolve, the organizations can explore joint marketing of existing clinical programs, physician recruitment, or the creation of new medical services.

Recently, Central Georgia Health System, based in Macon, announced an intent to form partnerships with two hospital organizations that are struggling, Putnam General Hospital in Eatonton and Milledgeville-based Oconee Regional Health Systems.

Alan Horton, CEO of the Eatonton hospital, told GHN, “Small independent rural hospitals are going to have difficulty surviving on their own.”

Rural hospitals’ financial dilemma “is much worse than it’s ever been,’’ Jimmy Lewis, CEO of HomeTown Health, told GHN recently. “The general cash position in most rural hospitals is extremely dire.’’

While some hospitals have closed, several others are struggling just to stay open, said Kevin Bloye of the Georgia Hospital Association.

“If this disturbing trend continues, we’ll have major access-to-care issues for hundreds of thousands of Georgians throughout the state,” Bloye said. “It will also have devastating financial consequences to areas that lose their local hospital which serves as a major economic engine.

He noted that the Elberton-Elbert County Hospital Authority has asked the county Board of Commissioners for $667,000 in annual funding to support the charity care provided by Elbert Memorial Hospital to local citizens. “This financial relief is needed to keep our hospital from closing, which would result in a devastating economic loss to the community and leave Elbert County residents without local access to health care services,” the hospital said on its Web site.

Reflecting the current financial challenges, Habersham County in the northeast Georgia mountains has agreed in a deal with the local hospital authority to make monthly bond payments on Habersham Medical Center’s $37 million debt. The county will eventually take over the assets of the facility.

It’s not just rural hospital systems that are moving fast. The powerhouse Piedmont Healthcare, based in Atlanta, recently announced that it has joined the MD Anderson Cancer Network, and also has aligned with WellStreet and its seven urgent care centers in metro Atlanta.

Sims of Stroudwater Associates said hospital systems are having to navigate two worlds in reimbursement. One is the traditional fee-for-service system, and the other a “value-based” model, where payments are geared to quality of care, not quantity of services.

The “value-based” system, Sims said, “may take five years before it goes widespread.” For now, he said, hospitals “have got to live in both universes.”

One revenue stream that Georgia hospitals aren’t receiving is that associated with Medicaid expansion. Having more uninsured Georgians on Medicaid would mean more revenue for hospitals that currently treat such people at a big financial loss.

But Gov. Nathan Deal and other Republican leaders in Georgia have decided against expansion, saying it would be too costly to the state.

Hospital companies nationally have seen a difference in states that have expanded Medicaid.

Hospital chain HCA on Tuesday reported a 6.6 percent drop in uninsured patients at its 165 hospitals — a reduction that grows to 48 percent in the four states that have expanded Medicaid.

Another hospital company, Tenet Healthcare, said in May that its hospitals are spending less on charity care for uninsured patients in states that have expanded Medicaid.

In states that have not expanded Medicaid, such as Georgia, Texas and Florida, Tenet hospital admissions for the uninsured have increased 2 percent while ER visits have decreased 6 percent, the company said.

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historylover
18863
Points
historylover 08/01/14 - 08:34 am
3
7
This one line says it all!

"One revenue stream that Georgia hospitals aren’t receiving is that associated with Medicaid expansion. Having more uninsured Georgians on Medicaid would mean more revenue for hospitals that currently treat such people at a big financial loss."

Thanks Governor Deal!

Marinerman1
5499
Points
Marinerman1 08/01/14 - 09:19 am
5
2
Can't Pay For It

The problem with expanding Medicaid was that while Obamacare would pay for it initially, after year three, the State would have to come up with the dollars. And also add the "Hospital Bed Tax" that all hospitals, except MCG, got hit with a couple of years ago. Lastly, couple all of that with reduced reimbursements like the article stated, and you have a real problem for hospitals. I found it funny to have a statement from HCA - if you have no insurance, Doctor's will stabilize you, and ship you to MCG or University. They will not treat you for free.

faithson
5531
Points
faithson 08/01/14 - 09:23 am
3
8
a reduction that grows to 48

a reduction that grows to 48 percent in the four states that have expanded Medicaid.
Heck, I got mine, let them eat cake... good Christian attitude. Let healthcare in the urban areas deteriorate because... because... my righteousness out weighs these people's healthcare. Perfect example of WHY the Ryan budget plan to give entitlement grants to the states is fulla bulla... Can you imagine how the republican have's would dole out to the have not's... it is not a pretty thing, except for those good Christian's who's bible driven agenda would allow squalor to exist among our citizens.

willie7
1047
Points
willie7 08/01/14 - 09:24 am
0
0
Thanks Governor Deal for
Unpublished

Thanks Governor Deal for helping to close some hospitals in Georgia!!

dichotomy
37614
Points
dichotomy 08/01/14 - 09:46 am
7
3
"Thanks Governor Deal!" Yes

"Thanks Governor Deal!"

Yes THANK YOU Governor Deal for NOT putting Georgia taxpayers on the hook for Medicaid expansion.

The real cause of hospital closings and doctors quitting and retiring is OBAMACARE and you ain't seen nothing yet. It's going to get MUCH worse.....and, oh by the way.....hospitals are closing and doctors are quitting and refusing to accept Obamacare IN STATES THAT DID EXPAND MEDICAID. The fact that Georgia did not expand Medicaid IS NOT THE PROBLEM.....THE CAUSE OF ALL OF THIS IS OBAMACARE. The hospitals were OPEN and doing fine BEFORE Obamacare without expanded Medicaid. OBAMACARE IS THE CAUSE and IT WILL GET MUCH WORSE. So when your Obamacare insurance rates go up this fall but you cannot find any doctors or hospitals that will take your insurance just remember.....the DEMCRATS forgot to tell you these little details when THEY passed this in the middle of the night in a dark room WITHOUT READING IT and certainly without thinking it through.

But that is typical. Obama did not think through his Middle East policy before he set it on fire. And he did not think through his BORDER policy before he caused our current crisis. And he did not think through is policy on coal fired electric power plants but you will be seeing the effect of that in your ELECTRIC bills before he mercifully leaves office.

This is what you get when you put radical left wing IDEOLOGUES in office, You get ideology....NOT WHAT IS GOOD FOR THE PEOPLE.

KSL
144554
Points
KSL 08/01/14 - 09:53 am
3
2
dichotomy

Or maybe he did think those policies through.

faithson
5531
Points
faithson 08/01/14 - 01:06 pm
3
5
where some of this off the

where some of this off the wall stuff comes from is beyond me. Sounds like an Ann Coulter rant, all emotion, no FACTS.....

GiantsAllDay
10558
Points
GiantsAllDay 08/01/14 - 07:43 pm
2
5
faithson, The way I see it,

faithson,
The way I see it, there are two men named jesus. One walked the earth 2,000 years ago and the other was put to death, lay dead in a tomb and after 3 days had his body reanimated (thus becoming a zombie) and acended into heaven and rules and reigns there. It is impossible to believe in both as they are mutually exclusive. I believe in the first one, the Jesus who walked the earth 2,000 years ago who would have had compassion and goodwill towards all and would have had a special place in his heart for the have nots. The religious right, aka "Christians" believe in Jesus #2. This makes them comfortable in their beliefs of exclusion as they get to decide in their own heads what the Jesus in heaven believes and feels. Just read their comments on the LTE about children entering the country. "It's just not Christian to assist immigrant children on the backs of those who won the sperm lottery and were born in this country".

historylover
18863
Points
historylover 08/01/14 - 07:58 pm
1
3
GiantsAllDay

Good for you! Not sure I totally agree with your zombie Jesus theory, (LOL) but I get your point. Well said!

GiantsAllDay
10558
Points
GiantsAllDay 08/01/14 - 08:14 pm
1
3
HL,What is your definition

HL,
What is your definition of a person who lays dead in a grave for some period of time and then comes back to life? I always wondered, if Jesus was murdered for our sins in the year 1920 instead of 33 CE, would Christians wear little electric chairs around their necks?

Gage Creed
19442
Points
Gage Creed 08/01/14 - 08:19 pm
3
1
Compassionate

Isn't it amazing how compassionate liberals are when they are growing their base...

"where some of this off the wall stuff comes from is beyond me. Sounds like an Bill Maher rant, all emotion, no FACTS....."

Little Lamb
49247
Points
Little Lamb 08/01/14 - 08:27 pm
4
1
Secret Code?

I'm sorry, but I cannot understand what faithson is talking about in his 10:23 a.m. post. It must be a secret code known only to the illuminati.

historylover
18863
Points
historylover 08/01/14 - 08:49 pm
0
3
Little Lamb

I got it completely.

historylover
18863
Points
historylover 08/01/14 - 08:51 pm
0
3
GiantsAllDay

That is a great thought too. (tiny electric chairs) You have a very creative mind. Something to really ponder...

itsanotherday1
48409
Points
itsanotherday1 08/01/14 - 09:16 pm
2
0
I'm sure the ACA has its

I'm sure the ACA has its effect; but rural hospitals have struggled to keep the doors open ever since I started in the business in 1982. Historically, it is BECAUSE of the large number of medicaid patients whose reimbursements are much less than insurance, that they struggle. People who can will bypass these hospitals to go to Augusta, Savannah, Macon, etc.

Additionally, the medicaid bunch overuse emergency rooms, which are expensive to operate.

fedex227
11187
Points
fedex227 08/01/14 - 09:52 pm
1
2
I fail to see how the ACA even enters into the equation ...
Unpublished

And I'm no expert, I may be wrong but ..

- Georgia refuses to expand Medicaid (with the feds picking up no less than 90% of the cost after 3 years)
- Georgia knows that healthcare costs rise every year
- The Georgia legislature is unwilling to fund rural hospitals when it comes to providing indigent care which accounts for most of the unreimbursed costs.

Rural hospitals are forced to shut down because they can't make a profit.

ACA or not, these hospitals would have shut down anyway. No?

seenitB4
98477
Points
seenitB4 08/02/14 - 05:56 am
3
0
GAD

Are you in to religion now? Or is that your twin posting?:)

corgimom
38720
Points
corgimom 08/02/14 - 06:35 am
2
2
And sometimes hospitals, like

And sometimes hospitals, like every other business, are just plain mismanaged. But I bet the administrators got their big paychecks and bonuses.

corgimom
38720
Points
corgimom 08/02/14 - 06:36 am
0
4
I understood it, too.

I understood it, too.

myfather15
57306
Points
myfather15 08/02/14 - 06:51 am
3
0
I guess our leftists

I guess our leftists "friends" haven't seen all the reports of doctor's refusing to take medicaid, simply because they never get paid in full!!

They just continue to believe that govmint can fix everything, although it's fixed nothing!!

soapy_725
44131
Points
soapy_725 08/02/14 - 07:28 am
0
0
CC could get some of those displaced patients. LOL LOL
Unpublished

CC could get some of those displaced patients. LOL LOL

soapy_725
44131
Points
soapy_725 08/02/14 - 07:29 am
0
0
Organized crime is alive & well in CC. Go to the courthouse.
Unpublished

Organized crime is alive & well in CC. Go to the courthouse.

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