The University of Kansas Hospital has told the state Board of Regents that it is making progress toward streamlining clinical operations and hopes the effort will lead to cost savings and growth to help offset financial losses resulting from the state’s failure to expand Medicaid.
Currently, a nonprofit group that runs most of the clinics on campus has to negotiate among 18 organizations. Between now and July 1, the plan is to combine those under the University of Kansas Hospital Authority, which has a 19-member board mostly appointed by the governor.
“To the outside person, you will probably notice nothing. But this is a massive reorganization,” said Doug Girod, executive vice chancellor of the medical center, which operates separately from the university hospital.
Girod told the regents that the reorganization will ease treatment for patients who need to see doctors from multiple disciplines and streamline such things as billing and record keeping, the Lawrence Journal-World reported.
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Even with the improvements, the university hospital and most hospitals in the state face financial pressures because Kansas has refused to expand Medicaid services to more people as allowed under the Affordable Care Act, Girod said.
Hospitals were supposed to break even because of significant reductions in the cost of uncompensated care for people without insurance. But because the state of Kansas has chosen not to expand its Medicaid services, hospitals are receiving reduced Medicare reimbursements without a corresponding reduction in uncompensated care, he said.
“The state of Kansas actually grew faster than any other state in the United States last year, over 12 percent growth in uncompensated care,” Girod said.
Bob Page, president and CEO of the University of Kansas Hospital, said it lost more than $100 million in Medicare reimbursements last year and expects to have another $95 million in cuts in the next five years. Uncompensated care at the hospital totaled $59 million in fiscal year 2014.
Gov. Sam Brownback is opposed to expanding Medicaid in Kansas because he doesn’t believe the federal government will continue paying for it in future years, which would increase the state’s costs. And the Kansas Legislature last year prohibited the governor from expanding Medicaid without legislative approval.