ACA Pressures Could Be Causing Calif. Hospitals To Merge, Sell
The Affordable Care Act pushes health care providers to reduce costs and improve care quality, but some observers say the law's requirements are causing hospitals to sell their facilities or make other changes to stay in business, the San Jose Mercury News reports.
Overall, 37 California hospitals closed between 2001 and 2010, resulting in the loss of 4,700 beds, according to data from the California HealthCare Foundation. CHCF publishes California Healthline.
During that time, just 16 hospitals opened, adding 1,510 beds.
Meanwhile, the number of skilled nursing beds in the state fell by nearly 33% and debt from hospitals' uncompensated care rose by 50% in that time.
However, emergency department beds increased steadily from 2001 to 2010.
Calif. Hospitals Struggling
Experts say that ACA regulations will speed up the trend of moving care delivery from hospitals to less-expensive systems, like outpatient or surgical care centers.
Maribeth Shannon, a director at CHCF, said, "If hospitals cannot adapt and play under the new rules it will be a challenge for them to survive."
Several California hospitals have undergone recent changes that might have been related to the ACA's new requirements.
For example, UC- San Francisco's Benioff Children's Hospital and Children's Hospital in Oakland last week announced a merger in an effort to offer more services while saving costs.
Meanwhile, the not-for-profit Daughters of Charity Health System this month announced it will sell all six of its hospitals.
According to the Mercury News, the six hospitals are "safety-net" facilities, which tend to treat a disproportionate number of low-income individuals. Many health systems can no longer afford to operate such hospitals because Medicare and Medi-Cal reimbursement rates are so low, the Mercury News reports. Medi-Cal is California's Medicaid program (Seipel, San Jose Mercury News, 1/27).This is part of the California Healthline Daily Edition, a summary of health policy coverage from major news organizations. Sign up for an email subscription.