Wow a Meeting and Hospital Fee May Be Back

Considering the fact that these guys have not met lately, this should be a pretty important meeting to determine the likelihood of coming to an agreement on health care reform legislation. Sen. Don Perata was sounding overly pessimistic, and his comments were pretty unproductive to the overall reform efforts. Nunez and Arnold were much more upbeat. SacBee:

In a prepared statement, Núñez said he remains "an eternal optimist," and added, "I will fight 'til the end for health care reform."

The speaker has said he plans to introduce the governor's health care plan himself and ask lawmakers to consider it this week.

The governor remains committed to achieving health care reform this year, said Sabrina Lockhart, a spokeswoman for Schwarzenegger.

"He looks forward to working with leaders on both sides of the aisle to get it done," Lockhart said.

Weintraub has an interesting column today, suggesting that the fee on hospitals aspect of the governor's proposal may not be dead in the water. He points out that a similar fee was passed on the nursing home industry, after they requested it.

The state's nursing home industry supported a 6 percent charge as a way to draw more federal money to California for Medi-Cal, the health care program for the poor. The federal government matches the state's spending on Medi-Cal. So for every dollar California collected in fees from the homes and then spent on Medi-Cal, the nursing homes, as a group, got an extra dollar back from Washington.

Republicans are opposing many other elements of the governor's plan. However, it looks like the negotiations with the hospitals have moved it towards a more common fee structure that may not require a 2/3rds vote. Arnold is continuing to work on it, despite some resistance from the Democrats.

The California Hospital Association has been working behind the scenes with Schwarzenegger's staff to test different ways of applying the fee.

Their mutual goal: to find a method that spreads the new federal money as widely as possible, to maximize the number of hospitals that would be winners under the deal and minimize the number of losers.

Although Schwarzenegger's original proposal called for a flat, 4 percent fee on all hospital revenues, the negotiations have now led the parties to a different approach: a fee based on the number of patient-days in each hospital. For each patient who belongs to a managed care health plan, a hospital would pay $141 per day. For other patients, the hospitals would pay $405 per day.

The fees would bring in $1.7 billion a year from private hospitals. That would be matched by $1.7 billion from the feds.

According to the industry's analysis, 282 hospitals would get more out of the exchange than they put in, while 88 would lose out on the deal.

The biggest winners would be those hospitals that serve the most Medi-Cal patients, while the biggest losers would be hospitals that do not serve the poor or do so on a more limited basis.

So while the Betty Ford Center would lose about $12 million a year, in Sacramento Sutter Medical Center would pay in $15 million and get $52 million back.

Weintraub has a point here:

But given that the big winners would be hospitals that serve the poor and the losers would be mostly centers that cater to the affluent, it's hard to see why the Democrats in the Legislature would continue to oppose the idea.

Look for the concept to re-emerge in the weeks ahead as the governor and the Democrats try to narrow their differences and close a deal before the end of the legislative session.

Interesting.