A group of small independent hospitals in Connecticut say the increasing cost of providing health care coupled with lower reimbursement rates from insurance providers and the government is making it harder for them to survive.
The Value Care Alliance is an association of seven of Connecticut's smaller hospitals. Members of the alliance say they are finding it hard to compete with the state's two large teaching hospital systems and a for-profit national chain.
The alliance is chaired by Patrick Charmel, the CEO of Griffin Hospital in Derby. The current system is not sustainable, he told lawmakers on the state General Assembly’s Hospitals Roundtable on Thursday.
Healthcare premiums have increased by double digits in recent years, he said.
“To the point, here in Connecticut, employees are paying 40 percent out of pocket, when you combine the premium share with co-pays and deductibles. So not only are employers saying enough, employees are as well,” Charmel said.
That’s forced hospitals to focus on trying to keep people healthy rather than waiting for them to get sick then taking care of them, he said.
The hospitals want Medicare and Medicaid reimbursement rates increased, he said.
Some of the hospitals are being reimbursed at a rate 30 percent lower than the state’s two large teaching hospital systems, said Dr. Stuart Marcus, head of St. Vincent’s Medical Center in Bridgeport.
Hospitals like St. Vincent’s don’t have the negotiating clout of the larger hospital systems, he said.
“Being in a two hospital town — Bridgeport — there is a 30 percent difference in Medicaid reimbursement rate for the same patient between the two hospitals that are two miles apart,” he said, comparing his hospital's reimbursement rates to that of Bridgeport Hospital.
The same thing is happening with reimbursement rates from private insurance companies, members of the alliances said. At the same time, the cost of premiums for private insurance is going up and fewer people are using the smaller, independent hospitals, they said.
Lawmakers expect to address the issue in the upcoming legislative session, according to the state Senate's incoming minority leader, Len Fasano, a North Haven Republican.
