New healthcare law is full of unknowns

About the only thing Dr. Philip Schwarzman can be sure of under the national healthcare overhaul is that he is adding his daughters, ages 23 and 25, to his health plan immediately.

Much less clear to Schwarzman is how the sweeping law will affect the emergency department at Providence St. Joseph Medical Center in Burbank, where he is medical director.

“It’s incredibly complicated,” said the white-haired physician, whose department sees 50,000 patients a year. “It’s hard to predict what’s going to happen.”

That pretty well sums up the Patient Protection and Affordable Care Act. Potential effects of the law, passed last month, can be described as profound and prosaic, obvious and unknowable.

Some of its most complex and far-reaching changes won’t take effect for years, including the requirement that, by 2014, all Americans have health insurance. But the law also contains immediate changes, such as the one allowing parents to add or keep dependent children up to age 26 on their health insurance policies.

Over the next decade, many of its consequences will play out at places like St. Joe’s, a 431-bed nonprofit hospital founded by the Sisters of Providence in 1943, and in surrounding community clinics.

St. Joe’s is typical by many measures. Medicare patients make up the biggest share, nearly 40%. About 36% of patients have private insurance, and about 22% are on Medi-Cal, California’s version of Medicaid, the government program for the poor. In the emergency room, about one in six is uninsured, about the same as the national rate.

The hospital serves a range of patients, catering to aging Hollywood stars ensconced in nearby Toluca Lake as well as grips, gaffers, schoolteachers and firefighters living in and near Burbank.

Its emergency room, bustling with nurses, doctors, clerks and paramedics, is often overloaded. For several hours every month, the emergency room is so busy that it closes to new patients and ambulance crews are diverted to other hospitals.

One of the rationales for the healthcare overhaul was that it would ease pressure on emergency rooms like St. Joe’s. As more people acquire insurance, the idea goes, more will get regular medical care. But will it work?

Schwarzman’s prognosis might surprise some people.

“Theoretically, if more people are insured and if they get access to primary-care physicians, then we should see decreases in the emergency department,” he explained. “But I don’t think that’s going to happen.”

That’s because even now, as at most hospitals, most emergency room patients at St. Joe’s already have insurance. They go to emergency rooms not because they have no physician but because they are too sick or impatient to wait for an office appointment.

“Fifteen years ago when HMOs started making headway, everyone predicted they would keep people out of emergency rooms,” Schwarzman recalled. “But the opposite happened.”

About 22% of emergency room visits at St. Joe’s involve minor problems, and less than 19% warrant admission.

The hospital sends patients with minor problems to an urgent care center down the hall from its emergency room. Nurse Kevin Traber, director of St. Joe’s emergency services department, is thinking about expanding the center in anticipation of increased demand from the newly insured.

“We’re still going to have the problem with people not being able to get appointments at their regular physician for a week or two weeks,” Traber said.

Five floors above the emergency room, patients in the rehabilitation unit build their strength by plying the hallways in wheelchairs and walkers. Kathy Sanks, 60, was there the day after President Obama signed the new healthcare law, recovering from back surgery.

The former administrative assistant, whose legs are paralyzed as a result of a spine tumor removed several years ago, is frequently hospitalized and is always on an assortment of prescription drugs. She pays for her medications with the help of Medicare Part D, the government’s drug program for seniors and the disabled. But, because she lives on a fixed income, she dreads what is known as the Part D “doughnut hole.”

That is the break in coverage that kicks in after Part D enrollees spend $2,830 on medications in a year. Coverage resumes when annual spending hits $6,440.

“Last year, I just about hit the doughnut hole, and I really was lucky that I didn’t,” Sanks said. “But it scares the crap out of me.”

Under the new law, if Sanks falls into the doughnut hole this year, she will be eligible for a $250 rebate. Next year, the law will provide a 50% discount on brand-name drugs for people who fall into the doughnut hole.

Such relief could add up to more than $9 billion in this state over the next 10 years, according to an estimate released recently by Democratic House members from California.

The new law also will increase the number of people on Medi-Cal. Because the government health program for the poor pays less than private insurers, hospitals will be pressured to treat more people at lower cost per case, said St. Joe’s chief executive, Barry Wolfman.

That should accelerate some trends that are already underway in many hospitals, such as standardizing procedures, he said. For example, hospitals are encouraging orthopedic surgeons to agree to limit the number of models of artificial knees they use to two or three, instead of a dozen. That, Wolfman said, allows hospitals to drive better bargains with suppliers.

Outside the doors of St. Joe’s, community clinics are gearing up to expand as hundreds of thousands of Los Angeles County residents join the Medi-Cal rolls. About a quarter of Los Angeles County’s 2 million uninsured residents are expected to qualify when the “individual mandate” requires them to have insurance in 2014.

The new healthcare law will help the clinics by providing $11 billion in capital improvement funds nationally over five years and by adding $1.5 billion to a medical school loan forgiveness program designed to encourage physicians to work at such facilities.

At the Northeast Valley Health Corp., which runs a dozen federally funded nonprofit clinics between St. Joe’s and its sister institution, Holy Cross Medical Center in Mission Hills, chief executive Kimberly Wyard is eager to apply for federal money to help pay for a new clinic in the Santa Clarita Valley and to enlarge its busiest facilities.

“We are out of space in the Pacoima and San Fernando health centers,” Wyard said. “We are running at full tilt Monday through Saturday and several nights a week. Unless we add Sundays, we really don’t have a place to expand. All our exam rooms are full.”

Despite the planning and projections inspired by the new law, much of its effect remains incalculable, Wolfman said.

“People are proud. They want to be able to pay their physician and their hospital. If people can be relieved of some of their anxiety and deal with their physical issue, that will be a benefit. That’s an intangible.”