Woes at Atlanta Hospital Mirror Nationwide Issues
One of the largest U.S. public hospitals, Grady Memorial Hospital in Atlanta, faces a "multimillion-dollar shortfall in the cost of providing charity and emergency care," and could face closure, the New York Times reports. According to the Times, "No one -- not the counties, the state nor the federal government -- has been willing to cover [the shortfall], though Grady provides vital services to the entire region."
Grady, in the past "admired for its skill in treating a population afflicted by both social and physical ills," could lose accreditation, and only "short-term financial transfusions have kept it from closing its doors," the Times reports. Grady faces an estimated $53 million fiscal year 2008 budget gap and owes Emory University and Morehouse College, the largest creditors of the hospital, an accumulated $71 million. In addition, Grady requires $366 million to meet capital needs, according to hospital officials.
The closure of Grady "would flood the region's other hospitals with uninsured patients and eliminate the training ground for one of every four Georgia doctors," the Times reports. According to the Times, the "prospects that Grady could close, and that Atlanta's health infrastructure could crumble, have forced a civic re-examination of the region's commitment to its least fortunate, a reckoning that has revived old antagonisms over race, power and class."
The problems at Grady are "emblematic of the crippling effect America's health care crisis has had on public hospitals around the nation," as the number has decreased from about 1,600 to about 1,300 in the past 15 years, the Times reports. According to the National Association of Public Hospitals, although public hospitals account for 2% of all U.S. hospitals, they account for 25% of all charity care provided by the facilities.
The business model used by Grady and other public hospitals is "no longer sustainable," as one-third of patients lack health insurance and one-third are Medicaid beneficiaries, which reimburses at rates "well below" hospital costs, according to the Times. Many public hospitals use revenue from the treatment of patients with private health insurance to help cover the cost of charity care, but "better-financed private and nonprofit hospitals are able to market their services and high-tech equipment to patients with good insurance coverage, including those on Medicare," the Times reports (Dewan/Sack, New York Times, 1/8).