By Toni Lawson, Chief Advcocacy Officer
Idaho Hospital Association
Imagine you work hard to run your business and make a living. You sell a product that costs you $100 to make. Ideally, you’d like to make enough from each item to pay your employees and continue to grow your business as demand increases.
Then, suppose Congress passes a law that requires you to sell your product to them at whatever price they name – let’s say $82. And suppose your State Legislature thinks that’s a great idea and they also pass a law so that, by the time you jump through hoops and the State takes their cut, they can buy your product for even less than what the Federal government pays – how about $56?
Welcome to the world of Medicare and Medicaid – and the current debate in Congress with the One Big Beautiful Bill Act (OBBBA).
To be clear, OBBBA is a tax cut bill, not a healthcare bill. But Congress must come up with a way to pay for those tax cuts. One option is to slash Medicaid reimbursements. Another is to simply take away people’s healthcare and not pay for it at all.
Keep in mind that nearly half of all Idahoans have healthcare coverage through Medicaid or Medicare.
Continuing with our business product analogy, the Federal government only reimburses 82% of the cost of care, and Idaho’s Medicaid program only reimburses hospitals and health systems 56% of the cost to deliver care.
Wait! That means Idaho’s hospitals lose money on one out of every two patients they care for. How long could your business survive at those rates? If the government isn’t paying enough to cover the cost, who is paying the difference? (Hint: Have you looked at your insurance premiums lately?)
So, let me see if I’m tracking the OBBBA impact on all of this. Congress wants to make corporate tax cuts permanent but jeopardize the financial viability of hospitals – one of the major employers in communities throughout the state, especially rural communities – by slashing Medicaid even more, or simply not paying for healthcare for some people.
They want to provide permanent tax relief to individuals and families, but pay for it by taking away their healthcare coverage? Where is the relief for a low-income Idaho family that now must pay hundreds of dollars a month in premiums for a plan with deductibles and out-of-pocket expenses that are five times the amount of their tax savings? That doesn’t sound like relief at all.
The Senate’s current version of OBBBA will have one of two results. It will either increase the cost of healthcare or force hospitals to reduce services. And that impacts all Idahoans – not just our family, friends, or neighbors who are on Medicaid.
Much like the local business that can’t keep its doors open by selling its product at a loss, our community hospitals are no longer financially viable when labor, supplies, and drug costs are skyrocketing while Congress is cutting Medicaid reimbursements.
We appreciate that our Idaho senators have made efforts to fix parts of the bill that will decimate Idaho hospitals.
Unfortunately, too many other changes to the bill are moving in the wrong direction. Call Senator Mike Crapo and Senator Jim Risch and tell them the magnitude of cuts to Medicaid will negatively impact Idahoans and the hospitals that care for them.
Let them know this latest plan will only increase the number of uninsured Idahoans, turning our emergency departments into primary care settings for thousands of Idahoans. Our delegation needs to understand that these cuts will impact all patients served by hospitals – not just Medicaid beneficiaries.
And there’s nothing beautiful about that.
Toni Lawson is the Chief Advocacy Officer of the Idaho Hospital Association, which represents all 51 of Idaho’s community hospitals.
I have one question….who’s idea was it to post this one??