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Springfield, MO

CoxHealth president and CEO
CoxHealth president and CEO

2017 Health Care Outlook: Steve Edwards

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Steve Edwards oversees a 10,000-employee health care system, which plans to close on its purchase of Citizens Memorial Healthcare in mid-2017.  

2017 Projection: “Whatever the Affordable Care Act has come to be will change. It will change in some important ways and ways that are worrisome.”

SBJ: What’s the fate of the Affordable Care Act in 2017?
Steve Edwards: Whether you like the Affordable Care Act or not and what it’s done, the way it’s constructed, it would be the equivalent of deconstructing the Eiffel Tower from the middle down. You have to deconstruct it in an organized way. The mandate for care makes the insurance model work because everyone has to. If there’s no longer a mandate, which is likely, the requirements to insure everyone only if they want to at certain rates, the math doesn’t work anymore. With the appointment of Dr. [Tom] Price, he spent the last part of his congressional career learning how to deconstruct the Affordable Care Act. He knows how to do it. We think a lot of it will be done through budget reconciliation by defunding programs. Look to see changes on the exchange. Medicaid expansion, which has occurred in 31 states, will likely be put in the state’s court without funding. Without funding, that will be a problem. Missouri never expanded. What we hope is that if Missouri was being fiscally prudent by not expanding, that will at least be recognized by the Trump organization.

 

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SBJ: So you expect the ACA mandate to go away?  
Edwards: I think the process to make it go away will happen in 2017. With the appointments Trump has made, for example Price, but also in Health & Human Services and the (Centers for Medicare & Medicaid Services) program coordinator, you’ve got one person who wants it to go away and one person who developed the Medicaid expansion program in Indiana under [Mike] Pence. There’s so many people with coverage now, that if you strip it away, it will be politically difficult. We need to kind of phase it. I imagine block grants will go to states to put the responsibility back on states instead of the federal government. Americans like the coverage. They don’t like the mandate.

SBJ: Are health insurance rates going up universally in 2017?
Edwards: We’re seeing commercial rates go up some, depending on their exposure, 3 to 9 percent. What we’re seeing most are those people who are mandated that don’t qualify for the subsidized exchange, we’re seeing their rates skyrocket. Why is that? Because the insurance companies have to take on the risk for the whole population, and they can’t adjust their fees very much. They’ve disrupted the natural economics of health insurance, so the result is higher prices. Insurance commercial carriers are consolidating, and as they consolidate, they get more leverage. With more leverage and more power in the market, they can raise rates, and so that’s a factor as well.

SBJ: Locally, we’ve seen a handful of recent closures and consolidations in health care. Will that continue this year?
Edwards: I think so. The state of Missouri has about 160 hospitals. The Missouri Hospital Association did an analysis of hospitals at risk. They identified somewhere around 50 hospitals that were considered at risk – typically rural hospitals. The larger hospitals are doing better. There are shortages that will put more wage pressure on hospitals. I think there will be continued stress. Payers, as they get more leverage, will ask for lower and lower rates. A rural hospital may not have the strength to fight that. Rural medicine is complicated to provide because sicker patients have to go to bigger hospitals. Their strength is being undermined by the evolution of care. CMH came to us and we came to them not out of weakness. They knew that they were strong now, but the future of health care meant we need to come together.

SBJ: How will CoxHealth and others address the area’s nursing shortage?
Edwards: We’re being very active in our market, working with other universities to grow. What we know about the nursing profession is, if you get your bachelor’s in nursing, get a certification, and go up our career ladder a little bit and work four extra hours a week, your salary would be around $70,000 a year. That’s more than lawyers coming out of law school. And yet, I don’t think the community knows that. If you’re a nurse who is competent, there’s not a city in the United States where you can’t find a job. It’s a great career, and we don’t have enough of them. We probably have about 1,800 nurses in our system. If we had 300 show up who are qualified, we’d hire every one of them. That doesn’t mean we’re running short necessarily; it means there’s a nurse that’s working more shifts and working harder. There’s a point where that’s a lot to ask of someone.



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