Introduction
More than 10million people with no ability to pay or no medical insurance receive medical care from public hospitals and other private hospitals every year according to the National Association of Public Hospitals and Health Systems, (2005). This is made possible by the commitment of a diverse set of providers such as the federally funded health centers, not for profit hospitals, free clinics, public health departments, individual physicians among others. These commit to providing health care to low-income populations, uninsured and the vulnerable in the society. These are called safety net hospitals or health providers. A safety net hospital maintains a legal mandate or adopted mission for an “open door” policy for all patients who come to seek services with them irrespective of their ability to pay (Dewan & Sack, 2008).
Increasing closures of safety net hospitals are due to financial difficulties they are experiencing. A big chunk of funding for these hospitals comes from Medicaid funding, through a mixture of payment mechanism for the purpose of institutional support and patient services. The Medicaid program is funded through a federal-state partnership to provide medical coverage to specified low-income populations and disabled people. States reserves the right to shape their own Medicaid program which may be more or less generous yet meet the federal requirements. These affect greatly the financial situations of safety net hospitals. In addition, these hospitals provide uncompensated care, which further adds to the financial burden. Since 1998 in the view of Regenstein & Huang, (2005), safety net hospitals have been experiencing negative margins that are below 2 % point, which are not enough to finance working capital or investment in the infrastructure and technology. One such hospital is the Grady Memorial Hospital in Atlanta, which owed $71million to Emory University and Morehouse School of Medicine in 2008 and Martin Luther King Jr-Harbor Hospital in Los Angeles which is experiencing the same problems.
Effects of closure of Safety Net Hospitals on public health
The closure of safety net hospitals means flooding of other hospitals in these areas with uninsured patients. This will put a lot of strain to these hospital facilities and staff, which undermines the quality of services given to them. Scenarios of patients denied services in private health institutions and others detained due to lack of money for payment will be common. In order to cope in the hard times, safety net hospitals cutback services, relocate or close some sections completely. Public health will deteriorate as patients will have to wait for long before they are attended or are given the necessary treatment. Some others will not access healthcare as they can not afford in other hospitals.
Some safety net Hospitals acts as training hospitals for medical personnel, with closure of safety nets learning will be affected (Regenstein & Huang, 2005).
Effect to consumers
Closure of safety net hospitals will leave majority of the uninsured and underinsured with difficulties in obtaining health care in other hospitals as they cannot afford. Patients that need special attention will be left unattended such as kidney sections, the homeless and the HIV/AIDS among others. Closure of these hospitals in some neighborhoods will cause a tear in the community fabric. In these neighborhoods most of the residents were born there, work there and is a sign of solidarity (Devers et al, 2001).
Market trends administrators should consider
Safety net hospitals could use steering committees organized around management and income cycle as a strategy for planning. These could have representatives from all stakeholders who will discuses issues affecting these hospitals and how they can improve revenue base and administration (Caph.org, 2004).
The hospital administrators could also consider establishing an integrated health system by providing high quality, up-to-date knowledge and services in created centers of excellence. These centers should be available to the whole community irrespective of financial background. Such centers attract high income earners who will come looking for the high-quality specialized services which will generate the revenue needed to maintain other services for the uninsured and underinsured.
Multi-hospital systems are another trend safety net hospitals’ administrators should adopt to cope with the current financial and demand pressures they are facing. These plans call for high accountability for costs and quality of services. This way, hospitals are able to avoid inappropriate costs and ensure safety of patients (Meyer, 2004).
Conclusion
Safety Net hospitals are hospitals committed to serving people irrespective of their financial situation. These have experienced closures in recent times due financial difficulties they are facing due to changing market trends. These closures affect the public health in that other hospitals in these areas will be flooded with uninsured and poor patients and training and learning facilities for medical personnel. Consumers will also find that they can not afford health care in these circumstances. Administrators of such hospitals can adopt various market trends in strategic management such as user steering committees in management, multi-hospital systems and integrated health systems.
Reference List
Caph.org. (2004). Proposed Restructuring of Safety Net Hospital Financing. Web.
Devers, K. J., Christianson, J.B., Felt-Lisk, S., Rudell, L. S., Brewster, L. R. & Tu, H.T. (2001).
Financial Woes and Contract Disputes Disrupt Market. A Community Report. The Center For Studying Health System Change (HSC). Web.
Dewan, S. & Sack, K. 2008). A Safety-Net Hospital Falls into Financial Crisis. The New York Times.
Meyer, J. A. (2004). Safety Net Hospitals: A Vital Resource for the U.S. Economic And Social Research Institute. Web.
National Association of Public Hospitals and Health Systems. (2005). What is a Safety Net Hospital? Web.
Regenstein, M & Haung, J. (2005). Stresses to the Safety Net: The Public Hospital Perspective. A Report to the Kaiser Commission on Medicaid and the Uninsured. Web.