We need a little more skepticism about UNC Health Care’s new deposit policy
The Triangle Business Journal and the News & Observer ran stories in the past couple of days about UNC Health Care’s new policy of requesting upfront payments of $100 from uninsured patients. X-rays and other tests will cost $20.
Dr. William Roper, CEO of UNC Health Care, notes that the hospital is overrun with uninsured patients during the economic downturn. Both stories print, apparently without question, Roper’s claim that UNC will lose $270 in uncompensated care this year, up from $140 million in 2005.
The first problem with using uncompensated care without questioning the number is that the unreimbursed cost of serving Medicare and Medicaid patients is included in the figure. Medicare pays pretty well and in North Carolina Medicaid is not bad. The figure cited by Roper is the difference between what the feds pay the hospital to treat Medicare patients and what the hospital wishes it could get for treating Medicare patients. That’s basically a made up figure. But neither paper asked Roper how much it costs to just treat patients who cannot pay.
In 2007 that number was about $53 million. Certainly not a drop in the bucket, but also not anywhere close to $270 million.
Also, did uncompensated care really cost UNC $140 million in 2005? In 2007 charity care was $52 million, unreimbursed cost for treating Medicare and Medicaid patients was $33 million, and bad debt was $5 million. That means uncompensated care in 2007 was $90 million. Why was uncompensated care $50 million less in 2007 than it was in 2005?
Aside from pinning down the numbers, it would be good to point out a few other facts. UNC gets millions in disproportionate share hospital payments, millions in direct appropriations from the General Assembly, and millions in tax breaks. It gets that money to provide care for indigent patients.
Roper also makes it sound as if indigent care is about to force UNC into bankruptcy. But every year UNC Health Care launches a giant new building project — including today’s announcement that it wants a $227 million hospital. If UNC is struggling under the massive load of uncompensated care how can it afford to build so many new buildings?
None of this is to say that UNC does not do its fair share of charity care. It does more than its fair share. UNC Health Care is a great resource for all North Carolinians. And Roper is speaking forcefully and eloquently for health reform that extends health insurance to everyone. But when it’s time to cut back in a recession UNC does not delay building projects, it tries to squeeze more money from indigent patients.
Perhaps this new deposit policy is necessary to keep UNC in business. But we should dig a little deeper instead of taking Roper’s claims at face value.