A 360° Discussion of Foreign, National and Local Policy Issues

Monday, April 22: Hancock County Healthcare

Despite the fact that our conversations often touch on healthcare (even if they start with foreign affairs!), this coming Monday’s discussion will be focused specifically on healthcare in Maine and Hancock County.

I thought this would be a suitable topic after reviewing Northern Light Health’s 2018 “Community Benefit Report” (required under IRS regulations) and observing that the system provided more than $220 million of benefits to the communities it serves. That compares to less than $9 million of system “net income” in that year. The good news is that margins were positive; the bad news is that margins are thin. (This isn’t a Northern Light Health-specific issue—many of the hospitals in Maine are losing money and similarly-situated rural hospitals across the country are facing the same margin pressures.)

If you review the report, you will note that a very substantial portion—more than 50% for both the system and Blue Hill—of the “Community Benefit” is the discount to cost (not price) paid by Medicaid and Medicare for services provided to their beneficiaries.

So I hope we can use this perspective as a springboard to discuss hospital finances—to play “CEO (or President)-for-a-day:”

  • How can hospitals make up for the un- or under-paid costs of services provided to patients?
  • Is there “fat” in the system in amounts large enough to offset these costs?
  • How should increasing market costs (provider compensation, medical devices, prescription drugs, non-provider salaries & benefits) be managed?
    • Wage caps?
    • Curtailed services (type, availability, hours)?
    • Reduced investment in facilities and equipment?
    • Higher prices for those who don’t have the Federal government’s ability to dictate what it will pay?
  • How can a commitment to quality be maintained in this environment?

I have invited John Ronan, President of Maine Coast Hospital and Blue Hill Hospital and the Chairman-elect of the Maine Hospital Association, to join us on Monday. In addition to providing an insider’s view on local hospital finances, he can speak to some of the issues facing our local facilities and provide context on the rest of Maine as well.

Homework

If you’re eager to do some homework, here are some resources that you might want to review:

Medicare for All

System/Hospital IRS Form 990s

(These show financial results, community benefit, compensation)

Electronic Medical Records

And this one, courtesy of Retta Clews:

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