Health care reform will be costly to hospitals, Kentucky Hospital Association chief says

Many of Kentucky’s 132 hospitals will lose money and be forced to merge because of the new health care law, says the president and CEO of the Kentucky Hospital Association.

Speaking to the Madisonville-Hopkins County Chamber of Commerce, Michael Rust, left, said one in three Kentucky hospitals is already losing money. Under the new law, reimbursement rates for Medicare are set to go down by 10 percent, which will further put the pinch on health-care facilities. “The proposed 10 percent reduction will cut jobs and wages by an estimated $5.3 million, reduce sales to businesses by $19.6 million and reduce state and local revenues by $1 million,” Ron Sanders reports on

Rust said the expanded coverage afforded by the law, known as the Patient Protection and Affordable Care Act, will cost Kentucky $1 trillion. Half of that will be financed by new taxes. The other half will be paid for through Medicare cuts, representing a $3.4 billion loss in Kentucky hospital revenue, Sanders reports. Hospitals are, in turn, “working to reduce costs through strategic affiliations or mergers or acquisitions,” Sanders reports from Rust’s speech. (Read more)

Kentucky Voices for Health Executive Director Jodi Mitchell told Kentucky Health News, “We know the law is not perfect and there are areas of concern that are valid. However, status quo is not an option given that we had a broken and costly health care system. We anticipate the reforms will continue to happen and there will be corrections and amendments to the law to improve upon it.” Kentucky Voices for Health is a coalition of more than 100 organizations and individuals working to build a healthier Kentucky and does not have a formal stance on the new health care law, Mitchell said. “It is the law of the land and we are trying to provide objective information in regards to the valuable consumer protection provisions that are in the law.”

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