Members of
“We’re not talking about PEIA negotiating with hospitals in general,” Haught said of the bill. “This bill strictly deals with PEIA negotiations in a non-state pool for inpatient rates only, nothing else.” Hospitalization rates are currently not allowed to be negotiated in
Haught said the current reimbursement rate for all state PEIA employees for a hospital stay is close to 60% of Medicare’s level. He prepared a tax memo for the committee, which included a projection of increased claims expenses for the non-state employee pool.
Advertising
According to the tax memo summary, provided on the West Virginia Legislature’s website, the costs “will not affect the state.” Instead, costs will be “borne by entities and/or members participating in the non-state plan,” which consists of those employed by counties and municipalities. The projected model shows that if the PEIA reimbursed state hospitals at 125% of Medicare reimbursement levels, instead of the current reimbursement level of 60%, annual claims expenses would increase by
Haught said there were 14,800 policyholders included in the non-state employee fund with 30,600 members. The PEIA charges each county or municipality a certain fee to be included in the PEIA, and it is up to each county or municipality to determine the amount of contribution by its employees.
Chairman of the committee
Haught replied that he thought that was a fair statement.
Senator
“There is no doubt in my mind that we need to find a real solution and that the hundreds of thousands of people who are paying are reimbursed at a fair rate. But… I am not sure how big of an impact this will have on the overall picture,” Stollings said. “I just wonder if we’re aiming too low.
Stollings then attempted to amend the bill to include not only non-state employees, but state employees as well. The amendment was rejected.
He noted that hospitals face rising costs for supplies and staff. As is often the case, hospital staff will leave the state for larger paychecks elsewhere, creating a staff shortage in hospitals around the world.
“A problem that we have, obviously, if we’re getting less reimbursement, the fact that we’re getting reimbursement below cost, our ability to even recruit people becomes an issue because we can’t compete,” Lauffer said.
He explained that if a person were to be admitted to hospital for an uncomplicated inpatient procedure, “the revenue generated from commercial insurance is approximately
“There are not enough commercial payers in the market for us to cover our costs,” Lauffer continued. “Why can I say this? We filed chapter 11 a few years ago.
“You can get to a point where individual hospitals start saying, ‘You know what, we can’t take this anymore,'” Kaufman said, discussing provider financial challenges. “I can’t say it was discussed among our board members. However, I wouldn’t be surprised if individual hospitals consider this. »
“I don’t think any provider wants to not serve their community,” he added. “However, you may come to a point financially where you cannot afford it.”
After discussion, where it was noted that this bill, if passed, is only a small step toward saving hospitals and the PEIA, committee members voted to move SB 574 to the max.