Hospitals and Health Care:

1

• Hospitals and Health Care
• The Next Two Years
• Maine Hospital Association
• Mary Mayhew
• September 2006

2
Our Community Hospitals

• High-quality, local health care
• 4.3 million patient visits each year
• 13,300 babies delivered each year
• 30,000 physicians, nurses and other hospital
  employees
• 3rd highest quality among the 50 states
• Open every hour, everyday
• At a cost below the national average.

3
The Hospital Mission

• Ensuring Access to the Continuum of Care
• Physician Recruitment Retention
• Keeping Pace with Medical Advancements
• Improving Community Health Status

4
Future Hospital Financial Challenges

• Public Payor Shortfalls Receivables
• Expensive medical technology and information
  systems
• Cost of drugs
• Health care professionals recruitment and
  retention wages benefits
• Defensive medicine/Liability insurance
• Cost increases of blood and other medical
  supplies
• Cost of regulatory compliance

5
Medicaid

• Explosive Enrollment Growth
• Mountains of Debt

6
Maines Medicaid Program

• 45 growth in last 5 years 80,000 more people
• 1 in 5 Maine citizens under 65 are on Medicaid
• Largest Medicaid program in the United States.

7
MaineCare Hospital Debt and Prospective Payments

• Settlements 330 mill.
• PIPs SFY 08 09 221 mill
• TOTAL 551,000,000
• State Share 204,000,000

8
MHAs Response

• SETTLE UP
• 3 Year Strategy
• 275 millionFirst Two Years
• 275 million15 months
• Democrat and Republican Response

9
MECMS

• Crossovers
• 24 Million
• Suspended Claims
• Future Fixes

10
Dirigo

• Prediction 31,000 enrolled by Jan., 2006
• Reality 11,000
• Savings Offset Payment (Premium Tax)
• MaineCare Expansions
• Blue Ribbon Commission
• Hospital Tax
• Cost Containment

11
Current Anticipated Cost Containment

• Dirigo
• Health Planning
• CON Cap 3.4 mill/.6
• Voluntary Cost Margin Caps 110 of increase in
  hospital market basket index / 3 Margin

12
What Next?

• Rate Setting
• Global Budgets
• CON Reform

13
The Rest of the Future

• Elections/TABOR
• Staffing Ratios
• Cost Containment
• Public Accountability
• Tax Exempt Status

14

• OUR MISSION