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MRHS Staying Ahead of Changing Healthcare Landscape

BY LEANN DILBECK –

For those who have been successful in enrolling, policies made available through the new Healthcare Exchange, went into effect January 1, 2014. And, as Mena Regional Health System [MRHS] Administrator Tim Bowen will tell you, the Affordable Care Act legislation that was signed into law in early 2010 has certainly changed the current healthcare system.

Bowen is quick to explain that he believes the long-term effects of this new system on the local rural hospital won’t be able to be fully felt until the end of the year at best.  “There’s so many moving parts,” he explained that only time will reveal what impact this could have on the local rural hospital but it is very safe to say that he and his fellow healthcare colleagues do have plenty of “concerns.”

Bowen explained that in 2009, it was obvious to him and many others in his industry that change was definitely needed. When the Affordable Care Act was proposed, it included a series of cuts that would be off-set with a surge of a newly insured populace that had previously been uninsured.  In 2013 alone, MRHS incurred $4.8 million in uncompensated care of its approximate $30 million in net revenue/collections.

The 2% annual cuts in Medicare and Medicaid, which comprises 55% of MRHS’ business, have been imposed as scheduled; however, the roll-out of the new Healthcare Exchange experienced its share of problems as has been well documented in national media. To add to the complexity, the policies written under the exchange reimburse healthcare providers significantly less than employee-sponsored or private policies.

And if that wasn’t enough, hospitals nation-wide are seeing a decrease in volumes.  MRHS experiencing a drop in volumes in 2013 between 5% – 8% in certain areas across the hospital.

The most recent numbers released by the Arkansas Hospital Association for the state of Arkansas is 112,960 as the total number of private option applicants from state and federal levels. Of those, 85,328 have been determined eligible for the private option so far. Of those determined eligible for the private option, 66,063 have completed the enrollment process (as of 1/6/14). An additional  6,760 have been determined to be better served by traditional Medicaid for a total of 72,823 people who will now have coverage.  This number includes 103,665 private option applicants through the State and 9,295 private option applicants received from the federally facilitated marketplace who have been determined eligible and their data has been processed by the state. In Polk County, a total of 637 have successfully enrolled for the private option as of January 10, 2014.

With all of the changes over the last few years, nationally and state-wide, the healthcare industry has been inundated with acquisitions and mergers.  Most recently, St. Joseph’s in Hot Springs, is in the process of being acquired by St. Vincent’s and the Booneville hospital was recently acquired by Mercy.

The good news for the local area is that Bowen said MRHS is well-positioned with good  cash reserves and top quality performance. Bowen said that with the Affordable Care Act passage in 2010, the hospital made some aggressive moves in 2011, 2012, and early 2013 in order to build cash reserves and invest in facility improvements. “Is it enough to weather the all changes imposed on healthcare?” Bowen said, “Only the future will tell.  We have to continue to be relentless in our efforts to find ways to lower cost, continue to improve quality, and invest in our people to stay ahead of the fast changing healthcare landscape.”

While the uncertainty can be very disconcerting, Bowen described all of the changes as “exciting” as healthcare makes a shift from being “volume based” to “value based.” “Everything we’ve come to know and expect in healthcare has essentially been flipped out on its head during this transition but we’ve done a good job of preparing and I am confident that our hospital, staff and physicians, are well positioned for whatever the future holds.”

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