Stephanie Kirschgaessner in the Financial Times explains why big PA hospital networks are going to be in for a world of hurt if Tom Corbett and Harrisburg Republicans reject the Medicaid expansion:
Hospitals in some US states are facing a potential financial crisis after a string of Republican governors rejected a provision of President Barack Obama’s healthcare law that would have expanded their number of insured patients […]
The development spells bad news for roughly 4m uninsured people – the working poor, as some analysts have defined them – who would have been eligible for insurance in those states. It is also devastating for hospitals who are legally obliged to treat those patients and take a hit to their bottom line whenever one walks through their doors.
In 2010, the hospital industry took a gamble on the ACA. They backed the president’s sweeping law and agreed to accept $155bn in cuts in government reimbursements over 10 years to help to pay for it.
In exchange, they were promised tens of millions of additional insured patients in the healthcare system who would no longer turn to hospital emergency rooms as a destination of last resort for free health services.
Ultimately, I believe the hospitals are going to win out over the Tea People. First of all, the federal subsidies are just way too good a deal to pass up. Second of all, hospitals and health care providers are a very important part of PA’s economy, especially in the biggest metros. Third, they are huge donors to Republican and Democratic campaigns. I will be very surprised if a majority of the legislature is willing to vote against the Medicaid expansion.