State commission recommends major changes in Florida public hospitals

State commission recommends major changes in Florida public hospitals

By John Dorschner

A state commission has released a report that could mean huge changes in the government-owned hospitals in Broward and Miami-Dade counties, but it’s unclear how quickly the Legislature will act on the group’s recommendations.

On Wednesday, healthcare experts were still digesting the 42-page report released Tuesday by the Commission on Review of Taxpayer Funded Hospital Districts, which recommended fundamental changes in the North and South Broward Hospital Districts and took a swipe at the high costs of Jackson Health System. The commission also recommended major Medicaid alterations that could be felt by all hospitals in the state.

The biggest changes were aimed at taxpayer-funded districts like the two in Broward. The nine-member commission, appointed by Gov. Rick Scott, recommended that the districts needed to be reapproved by voters every 8 or 12 years or be shut down. Commissioners also want the taxing authorities to be separated from the government-owned hospitals and to provide financial support for all hospitals in the area that treat indigent patients.

Spokeswomen for both Broward districts said they had no immediate comments on the report. James Zingale, research economist for the Safety Net Hospital Alliance of Florida, which represents the main hospitals across the state that care for the indigent, said Wednesday, “We are analyzing very seriously” the three main recommendations, but he had “no public statements.”

Scott, former chief executive of the for-profit HCA hospital chain, has been a strong advocate of reducing government costs. On Wednesday, Scott spokeswoman Jackie Schutz emailed that the governor and his staff “are still reviewing the report and look forward to implementing the recommendations that make sense.” But she offered no timetable. In November, Scott told the Daytona Beach News-Journal that the 2012 Legislature had a lot to do and probably wouldn’t have time to deal with public hospitals.

Scott created the commission to answer several crucial questions about public hospitals, including whether their care was as good as that provided by non-government hospitals, whether their care cost more and whether their hiring of physicians created unfair, tax-subsidized advantages not enjoyed by non-government hospitals.

The commission decided it didn’t have enough information to decide about quality of care or physician employment.

The cost question sparked a major debate among commissioners. Keon-Hyung Lee, a Florida State University researcher, reported that patient expenses were 15 to 18 percent higher at public hospitals, even when adjusted for severity of illness and other factors.

That brought strong objections from Zingale of the Safety Net Alliance and Paul Duncan, a University of Florida health professor and member of the commission. Both said the public hospital results were skewed by the extremely high costs at Jackson. Lee redid his study without Jackson. The second report showed that Florida government hospitals’ costs were 11 to 12 percent higher.

In an email Wednesday, Duncan said the research still didn’t make for an “apples to apples” analysis. Zingale said Lee’s work didn’t account for many variables, including such expensive care as neonatal and organ transplant, which are major activities at Jackson.

Jackson spokesman Edwin O’Dell said the system has several reasons why its costs are higher, including being a “world-class teaching hospital” and treating extremely sick patients.

Lee also told the commission that public hospitals tend to get more in state-federal funding — 28 to 33 percent more from Medicaid and 213 to 250 percent more from special funds called Lower Income Pool and Disproportionate Share.

The commission recommended Medicaid payments be made more equitable by changing to a system in which hospitals are paid for treating a specific illness, such as a heart attack, rather than getting reimbursed for length of hospital stay or specific fees for each service performed during the stay.

Such a change — which could take several years to implement — could produce huge reductions in funding at Jackson, where lengths of stay tend to be considerably above the average of other hospitals.

Zingale at the Safety Net Alliance said the funding change could be fair, if it took into account that some cases were simple and others complex, or could be unfair if it averaged all types of a procedure into a single diagnostic group.

O’Dell at Jackson said, “As the state’s largest Medicaid provider, we are always interested in conversation about how to treat our unique population in the most effective way.”

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