Edward J. McGeachey

Edward J. McGeachey

As I write this, there are men, women and children in Southern Maine Health Care’s (SMHC) emergency departments, our physician offices, in surgery, or in beds in our hospital. Our caregivers do not care about their patient’s ability to pay. All they are concerned about is giving the patient the very best care possible. And that is how it should be, because SMHC, like other Maine hospitals, is a not-for-profit healthcare system, meaning we provide the same high-quality care regardless of a patient’s insurance status or ability to pay.

This open-door, non-profit mission has served as the healthcare backstop for over a hundred years for the people of Maine, a state ranked as one of the best in the nation for the quality of our health care services.

But “no insurance” often equates to “no pay” when the cost of health care is beyond an individual’s ability to pay. The financial burden of providing free care to an increasing number of people is undermining the future of Maine’s excellent health care systems. This should be of significant concern to everyone in this state, where nearly half our non-profit hospitals are operating at a deficit as they absorb an ever-growing mountain of free care.

SMHC, the health care provider for the majority of people in York County, provided $7.8 million of free care last year to people who did not have insurance and whose application proved that their income qualified them for free or reduced cost care. We don’t do this passively. We work with qualified patients to help them sign up for health insurance on the federal Exchange created under the Affordable Care Act. We also help people apply for free or reduced medications through our MaineHealth MedAccess program, a program that has saved local residents over $32 million in chronic care prescription medications over the past eight years.

But there is a large group of very low-income patients – many of whom have significant healthcare needs – whose incomes are too low to qualify for subsidies on the Exchange. These individuals were expected to be covered by each state’s low-income insurance program, known here as MaineCare. Federal funds were made available to supplement state funds to support the MaineCare program. Unfortunately for these individuals – and those who care for them – Maine has been one of very few states to reject the additional federal funding and refuse to expand the program as intended. The decision not to expand MaineCare has left over 80,000 Maine residents without healthcare coverage. So when they need emergency care, mental health services, care for chronic conditions or even preventative care, Maine’s not-for-profit health care providers step in and provide the care without reimbursement in most cases.

The increasing volume of people who do not qualify for MaineCare and cannot afford insurance through the federal exchange is greatly stressing Maine’s health care system. It wasn’t supposed to be that way. When the Affordable Care Act passed in 2010, its financing model was based on key factors:

Hospitals, expecting that the number of uninsured would decrease due to the Accountable Care Act and Medicaid expansion, agreed to reductions in Medicare reimbursements and in payments the federal government makes to help with charitable care.

In turn, the federal government agreed to increase the payment to states that expanded their Medicaid (MaineCare) coverage, enabling physicians and hospitals to offset this loss as more uninsured patients gained coverage through the Exchange and expanded Medicaid.

This has not happened in Maine. By 2019, SMHC alone will have contributed more than $35 million to fund expanded coverage under the Affordable Care Act. Those reductions in federal payments to the hospital were to be offset by $19 million in new insurance revenues, of which $6 million was supposed to be derived from Medicaid expansion. But MaineCare expansion has not been enacted.

As a result, Southern Maine Health Care is providing more free care than ever with far less federal and state reimbursement than expected. Increasing free care translates directly to higher private insurance costs for many Maine residents already struggling to pay health care premiums and faced with annual deductibles beyond their ability to pay. This situation is not sustainable for Maine’s people, Maine’s health care providers, and Maine’s economy.

Currently, the Maine Legislature is considering a bill, LD 633, which would expand Medicaid coverage to Maine’s neediest while also providing coverage for the working poor through private insurance coverage, requiring those individuals to pay for a portion of their costs. It is reasonable to be cautious about how much Medicaid expansion would cost Maine, but it is also reasonable to consider how much the failure to expand Medicaid is costing Maine’s people.

The recently released nonpartisan fiscal note on LD 633 shows that its expansion of MaineCare would result in $1.2 billion pumped into Maine by the federal government over three years – far more than the $93.1 million expenses projected over that period. That money would ripple through the state’s economy through increased health care jobs as well as savings on private insurance premiums.

Some people fear that Washington could change the funding equation. However, in Medicaid’s 50-year existence, the federal government has reduced Medicaid funding only once, temporarily, in the early 1980s.

Maine is turning federal money away and our tax money is then being spent in support of health care in other states rather than in Maine where it is sorely needed. Thinking that Maine’s non-profit health care providers are the answer to providing care to the uninsured is a short-sighted solution that could be very costly. Like everything else in life, free care is not free; and at this rate, it could cost Maine residents the access to the great local health care they rely upon 24/7.

Edward J. McGeachey is the President and CEO of Southern Maine Health Care.

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