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Sunday, January 26, 2020
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Health & Hospitals

Solution?? Local Doctors Not Paid for Indigent Care

Category: Health & Hospitals

SBJ Staff

Editor’s Note: The Savannah Business Journal has worked for more than six weeks on this story, interviewing over 10 people involved in the important issue of physician’s reimbursement.

Funding indigent care is a difficult challenge for all of our area’s local hospitals. Both hospitals run or managed by “for-profit” companies such as Memorial University Medical Center, and those with nonprofit status, such as St. Joseph’s/Candler, deal with laws that require hospitals and physicians to provide for the medical needs of patients who arrive at their emergency rooms for care and lack health insurance coverage.
Philip Schaengold, president and CEO of Memorial, estimates that roughly 20 percent of the hospital’s patients are covered only by Medicaid, where reimbursement is relatively low for both the hospital and any physicians involved in a patient’s care. And, another 10 percent of Memorial’s patients are indigent or “self-pay, where the odds of collecting any money for services is a relatively low probably,” he says.
St. Joseph’s/Candler also provides a significant level of indigent or low reimbursement care. But what is not often discussed, is that, not only are the hospitals not being reimbursed. but physicians who provide the care are not reimbursed in some counties in Georgia. Chatham County is one of those counties.
Many of these physicians are private business owners, not employed by the hospitals, who are running private companies with employees, and they have operating expenses and overhead like any other business entity. They have “privileges” at various hospitals, and some even rent space for their practices within the hospitals.
But when they are called to provide care to an indigent patient, whether it’s a head trauma from an accident on the highway or to deliver a baby, the physician is not getting paid. In many cases, the physician’s staff is also involved in the care and follow-up with the patient. The physician is paying his or her employee but not being reimbursed for their payroll or payroll taxes, as well.
“They’re not giving enough” towards paying physicians for providing care to the indigent, in the opinion of Dr. Jules Toraya, president of the Georgia Medical Society (GMS). “They require us to take care of people, but they don’t pay us to do it.”
Of the more than 700 physicians in Chatham County, more than 500 belong to Chatham County’s physician’s association called the Georgia Medical Society, led this year by Toraya, who owns Obstetrics & Gynecology Associates at 5353 Reynolds St., located within Candler Hospital.
GMS is Georgia’s oldest medical society and the oldest continuously functioning medical society in the United States. Despite its name, GMS is not a statewide group; its physician members are local.
In April, the society invited Georgia State Rep. John Lunsford from McDonough down to Savannah to come and speak. His topic was “Transparency in Healthcare, defining Charity, Indigent Care & Community Benefits.” Paul Hinchey, president and CEO of St. Joseph’s/Candler Hospital System, and Charles Neumann, who at the time was the interim president and CEO of Memorial University Medical Center, were both invited but sent a joint letter to Toraya informing him that they declined to attend. He isn’t happy about that decision.
Lunsford presented the GMS members with a number of facts about how hospitals in Georgia are run, about the Georgia Alliance of Community Hospitals to which most nonprofit hospitals in Georgia belong, about the financial condition of the Alliance’s member hospitals and about the amount of money Lunsford alleges that the Alliance spends on lobbying.
Much of the information presented to GMS, however, is grossly inaccurate.
Two particularly inflammatory pieces of information being disseminated by Lunsford stand out. First, he told local physicians that hospitals in Georgia have a $ 5 billion pool of money that they are not spending and that he contends could be used to reimburse physicians for their service to indigent and Medicaid patients.
Not true, according to Monty M. Veazey, president of the Alliance and Hinchey. By state and federal law, hospitals must retain a level of cash and liquidity that is a percentage of the hospital’s borrowings, like any other business with operating and capital equipment loans. It’s strictly business and banking procedures and regulations.
Hinchey walked the SBJ through his hospital systems’ overall financial position, borrowing positions and available cash, The cash the hospital has at the close of its financial periods is in line with what must be maintained, and not spent.
The same is true for Memorial University Medical Center, according to Schaengold.
The second piece of information being disseminated by Lunsford, and by Toraya on behalf of GMS, involves the number of lobbyists hired by the hospitals’ Alliance to represent them at the Georgia State House and in Congress.
Lunsford told the GMA, and Toraya recently wrote in an opinion piece he published in a local newspaper, that the Alliance has 96 lobbyists. “It’s their lobbying club,” he told the SBJ.
In Georgia, as well as at the federal level, all lobbyists must be registered. The Alliance, in fact, has only three non-employee lobbyists registered with the State of Georgia.
Lobbying registration law requires that all individuals who might speak to an elected official on behalf of a group or organization are defined as a “lobbyist.” Therefore, Veazey, as the executive director of the Georgia Alliance of Community Hospitals, also must be registered, as is attorney Julie Ellen Windom, vice president of the Alliance. The same is true for the Alliance’s public relations specialist.
Adding together the staff and the outside, hired lobbyists, the Alliance’s list with the State of Georgia only contains a total of six to seven people in total, depending on the time of year.
By comparison, Georgia Physicians Association, the PAC of the Georgia State Medical Association, has 20 registered lobbyists in Georgia working on behalf of physicians. Putting aside what appears to be disinformation, the issue of whether physicians should be paid for providing indigent care in Chatham County, is an important one for area physicians.
Surprisingly, physicians are not able to take non-reimbursed work as a business loss or a tax deduction, an issue that both Hinchey and Schaengold agree might be a reasonable solution.
“That makes some sense to me. Certainly, many of our physicians are running a business, and you would think that something like that might exist in the tax codes,” Hinchey said in a recent interview.
Some counties in Georgia pay physicians who provide indigent care, particularly in certain specialty care areas such as orthopedics. Veasey, who also sits on the board of his county’s hospital, said that that county pays some of the physicians to provide indigent care, “so that someone will show up.”
As to whether hospitals in Chatham County can afford to pay physicians, Toraya states that GMA disagrees with the definition of “community benefits” that the hospitals define as part of their non-reimbursed costs on their operating statements, balance sheets and required reports.
State laws vary widely as to what is defined as a community benefit that a hospital provides. Toraya and Lunsford explain that some hospitals include bad debt, un-reimbursed cost of Medicare, charity care, cash and in-kind contributions, community health improvement services, health professionals education, medical research, economic development projects and housing programs.
“This is a rip-off of the taxpayer of the state,” believes Toraya, because many hospitals in Georgia receive public funds to operate, such as the Level 1 trauma unit at Memorial. “Defining what is a community benefit needs a standard definition,” he said. “It’s minimal, what they are really spending for community benefits in many instances.”
Veazey says that Toraya is misinformed. “In our county, for example, we provide flu shots for seniors and defibulators for the public schools. Some of these projects are funded by funds raised by our foundations. They are not counted in our hospital’s unreimbursed costs,” he explains.
“What he’s not taking the time to see is that a lot of community benefits are not paid for by bonds that are generated by the hospitals, they are done by privately donated funds to the hospital, funds that are contributed to the hospital foundation, for instance,” Veazey said.
Certainly, the issue of health care for uninsured patients is topical, with the current national discussion in Congress about providing health insurance to a larger percentage of U.S. residents.
According to Toraya, 28 percent of emergency patients in Chatham County are between 18 and 65, too old to be covered by PeachCare for children and too young for Medicare coverage.
But Veazey adds that what Toraya is not acknowledging is that there is another issue, that many physicians will not accept patients who are on Medicaid in those years between 18 and 65, because they “lose money on those patients. They’re not welcome there. And they refer them over to the ER of the local hospital, which compounds the situation in the ER,” he states.
Veazey also states that Toraya does not understand about hospital financial filings. Hospitals do not make financial filings at the county level; only hospital authorities do that. “Every hospital in the state, every year, must file a report with the state, and that is done,” he said.
“It is a legitimate complaint of physicians, when an indigent patient presents themselves,” said Schaengold. “But the problem right off the bat is your definition of an :indigent patient; you have the Medicaid patients. The reimbursement to physicians is very low. It is true that in some locales, the hospitals have had no choice but to pay physicians to care for patients that have presented themselves to the hospitals in order to fulfill their responsibility as a community hospital.”
“My personal opinion is that it’s really unfortunate that we are asking physicians to provide care that our Medicaid and state and federal system should pay sufficiently for. What you’ve got is a broken system which leaves some hospitals with no choice but to pay some physicians to provide, particularly in specialty care areas,” he added.
“In Chatham, we are blessed with having many physicians that have volunteered to provide services to patients that do not have insurance. We have been very fortunate that our physicans care so much for this community that they are willing to take on this burden on our behalf,” he said.
Hinchey agrees, and also points to the long list of community services, programs and clinics that his hospitals and physicians provide to the community.
Schaengold, who was just named Memorial’s CEO as of June 1, added, “I just came back this afternoon from visiting Union Mission, and I was so pleasantly surprised to learn that 35 of our dentists provide free services to people without insurance. And it just shows you that we have people who are not asking to be reimbursed to care for the less fortunate in our community.”

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