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Nation's Hospitals Thrive as N.J. Facilities Struggle
Date:11/11/2008

p>AHA reports that the total amount of uncompensated care delivered by the nation's hospitals reached $34 billion in 2007, a 5.8 percent increase.

Two recent reports have identified government underfunding of New Jersey's hospitals as a key factor in their fragile finances. In New Jersey, Medicaid - the state program that provides healthcare to the poor - pays hospitals an average of just 69 cents for every dollar of care provided. Medicare, the federal program that provides healthcare to seniors, also reimburses New Jersey at less than cost - 89 cents on the dollar.

New Jersey's charity care program is another burden that sets the Garden State apart. While most other states have designated hospitals that provide care to the poor and uninsured, New Jersey law requires all the state's hospitals to care for charity care patients. While the cost of that hospital care reaches $1.3 billion annually, the state will reimburse hospitals less than half that total, or $605 million.

The January 2008 report from the state's Commission on Rationalizing Health Care Resources identified government underfunding as a key source of hospitals' shaky finances. And a 2006 report from the financial consulting firm Accenture, which was commissioned by NJHA, showed that poor payments for charity care, Medicaid and Medicare all are key reasons behind hospitals' deteriorating bottom lines.

"There's no surprise revelation behind this new data," said NJHA's Sean Hopkins, senior vice president of health economics. "New Jersey hospitals, quite simply, are crumbling under the burden of inadequate reimbursement. The new data merely re-enforces what we've witnessed here for quite some time."


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SOURCE New Jersey Hospital Association
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