Health Care Denied Makes a Weak Nation : Hospitals Are Crushed by the Burden of the Many Who Aren’t Able to Pay

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<i> Samuel J. Tibbitts is chairman of the board of UniHealth America, a health</i> -<i> care company that owns 14 hospitals, including the California Medical Center. </i>

We are in a health-care crisis that has never before been seen in this country.

The public has come to believe that health care is a basic right. The government has fostered that belief. But neither government, employers, insurance carriers nor the people themselves are willing to pay the cost. And since the care-givers cannot survive--cannot pay the salaries of nurses and technicians, cannot buy medical supplies, cannot keep their doors open--without payments to cover their costs, we are now experiencing a collapse in the most fundamental of all medical care needs: access to emergency services.

Seven Los Angeles hospitals have had to close their trauma centers. A major central Los Angeles hospital has said it can no longer accept ambulances. Six other hospitals have said they probably could not continue to provide emergency services if there is any increase in the number of non-paying patients brought to their emergency departments.

The cause of this problem is perfectly clear: Hospitals in California suffered losses of more than $2 billion in 1987 from care given to patients for whom there was little or no payment.


While it is not legally guaranteed, as a society we have come to expect access to health care as something highly desirable and important to our well-being. Without health we have nothing. But no one in this country has ever identified a national policy that describes how much health care should be everyone’s right, how should it be provided and who should pay for it.

In its usual patchwork style of problem- solving, government has created the situation that we face in this country today and has produced a quadruple whammy for hospitals in California:

--The nation’s employment base has been shifting away from manufacturing toward more service and small-business jobs, resulting in 30 million American workers and their dependents who don’t have health insurance; 5.1 million of these uninsured living in California.

--The federal government changed the method of payment under Medicare, placing the hospitals at risk for the cost of treating Medicare patients against a national rate that is only partially related to the higher cost of doing business in California.

--The state government changed the method it uses to pay hospitals for services to the poor so that the daily rate paid is now almost 40% below what it actually costs the hospitals to care for Medi-Cal patients. The state also shifted its responsibility for the medically indigent population to the counties and cut the payments to the counties in the process.

--Following the government’s lead, insurance carriers, preferred-provider organizations, health-maintenance organizations and large self-insured employers began contracting with hospitals at rates that severely limit or prevent any shifting of the losses from government programs and charity care to the paying patient. In California, only 15% of patients pay full charges.


The result is a chaotic situation with more than 50% of California hospitals operating in the red. The only choice available to these hospitals is to close their doors or cut back on those services where most of the loss is being created, such as the emergency and obstetrical departments.

It is time for the government to wake up to the situation it has created. In the short term, funds must be allocated to keep our vital hospital emergency departments open. Their closing eliminates access to emergency services for everyone, whether they can afford it or not.

For the long term, the governor and the next President must exercise leadership. We must have a state and national health policy.

A top-level, knowledgeable and bipartisan commission should be formed to address some very weighty and politically sensitive health-care issues:

--Is health care a right for all Americans?

--Is there a limit on the resources that our society is willing to pay for health care?

--Is the financial responsibility for health care properly proportioned among government, employers, health-care providers and the individual citizen?

--Should health services be the same for all people regardless of income?

--If resources are limited, where should the money be spent in terms of health education, preventive health services, acute health care, home-health care, mental-health care, skilled nursing facilities and hospice?


--Should there be age limits or other criteria to ration the provision of highly expensive health services such as open heart surgery or liver transplants to those who would likely benefit the least? Bioethical issues such as the individuals’ right to die must also be addressed.

This nation certainly has the capability to handle the health-care crisis. However, we have not yet found the political will to solve it. If we don’t solve it soon, issues such as the national debt and trade imbalance will pale by comparison.

The people without adequate access to needed health care will become weak and demoralized; an unhealthy nation will be a weak nation. We simply cannot afford the consequences.