N.J. health care facilities could owe 1.5B if ACA is repealed

Anjalee Khemlani//January 27, 2017

N.J. health care facilities could owe 1.5B if ACA is repealed

Anjalee Khemlani//January 27, 2017

Hospitals in New Jersey could be on the line for a combined nearly $1.5 billion in federal obligations to support the Affordable Care Act, which they have been contributing to since 2010, through 2019 if the ACA is repealed.The New Jersey Hospital Association said on a conference call Thursday that to-date, $1.5 billion has been sent by acute and post-acute care hospitals to fund the ACA in what would be a total of $155 billion over 10 years.

New Jersey Hospital Association CEO and President Betsy Ryan said the continued cuts to hospitals in the state would be devastating, and has repeatedly asked that if the ACA is repealed, the funding sent to the government be simultaneously returned if a replacement is not enacted.

NJHA visited Capitol Hill in November to lobby for these changes, and will again in February, Ryan said.

But what the next step from Republican-controlled Congress and the administration of President Donald Trump will be remains, as with other sectors, a destabilizing question mark.

NJHA warned significant economic impact of a repeal. Prior to the ACA, at least 30 percent of member hospitals, including some which are now closed, were operating in the red, now that number is closed to 13 percent.

In addition to the funding cuts, health coverage for more than 796,000 New Jersey residents could be jeopardized as well, the NJHA said. That could force hospitals to increase charity care services dramatically, compounding funding cuts for that program from the last two state budgets.

Since the rollout of the ACA and Medicaid expansion in the state by Gov. Chris Christie, charity care has been cut in half with the anticipation that more individuals would be covered when visiting a health care provider.

That doesn’t include the nearly 400,000 undocumented immigrants in the state who are ineligible for insurance through the ACA exchange or for Medicaid. They remain the prime reason charity care exists in New Jersey, which Ryan said is considered a “border state” because of its significant immigrant population.

The most recent audited documented charity care spend for New Jersey safety nets is $477 million, according to NJHA.

By comparison, last year’s state budget allocated roughly $300 million for the hospitals.

Christie recently announced his support for Medicaid block grants, which the NJHA has previously opposed.

The loss of coverage would mean that more people might access the emergency room rather than a primary care provider, resulting in higher cost of care, according to Sean Hopkins, senior vice president of federal relations and health economics at NJHA.

So far, none of the Republicans’ plans appears to provide a viable alternative to the ACA, Ryan said.

“As we talk to experts with respect to block grants. They worry that it is a way to cost shift to the state and provider community,” Ryan said.

The NJHA also found that:

New Jersey could lose $4.4 billion in federal matching dollars under Medicaid expansion;

New Jersey residents could lose $795 million in federal subsidies that help them pay insurance premiums;

New Jersey could lose 86,400 jobs, according to an analysis by the Commonwealth Fund; health care is the state’s second-largest employer, with hospitals alone employing more than 142,000 people.

The NJHA said a solution to the funding issue is clear: Lawmakers must pass a replacement plan simultaneously with any ACA repeal. If they cannot or will not do so, the organization said, they must find a way to return the deep funding cuts to providers to help them care for people who lose new-found coverage through the repeal.