Springfield, MO

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CEO, Ozarks Community Hospital
CEO, Ozarks Community Hospital

2015 Economic Outlook: Paul Taylor

Posted online
Paul Taylor is leading OCH into a new era as hospitals attempt to find their sea legs following the Affordable Care Act.

2015 Projection
Through the settling of ACA reforms, there will be new norms established, centered on developing a medical home model for providing primary care.

SBJ: What’s the state of health care in southwest Missouri?
Paul Taylor: There have been a lot of challenges, particularly in Missouri and southwest Missouri because of health care reform, because of ACA, because of reductions in governmental reimbursement and because of the lack of Medicaid expansion. There is a lot to deal with. In southwest Missouri, in particular, there are a higher percentage of uninsured patients.

SBJ: Do you expect the landscape to improve in 2015?
Taylor: I think the industry is adjusting to the landscape, but the challenges will continue. There have been some consolidations of organizations. Mercy has absorbed McCune-Brooks, a small critical access hospital in Carthage. The Cox system has absorbed Skaggs Hospital in Branson. Consolidation is one of the ways the industry is responding to the challenges and changing landscape.

The other thing that’s happened is we are finding our new sea level. A number of the challenges have been met, so we are trying to get our new sea legs and adjust to that new normal. Systems are reducing expenses, seeking other forms of revenue and adjusting so they can move forward.

SBJ: Why so much absorption of small systems?
Taylor: The smaller systems are finding it increasingly challenging to continue and remain independent. They have difficulties accessing capital. It’s very difficult when you are an independent system to withstand assaults to your revenue cycle. As you look at dwindling reimbursement from the government, if that happens to be a high percentage of your payer mix, frankly, you get a little weak in the knees and begin looking for help. Often, that help is a larger system that has more resources.

SBJ: What does that look like for OCH?
Taylor: We have had to reinvent ourselves in Springfield. We eliminated our inpatient medical and inpatient behavioral services and laid off approximately 70 employees in Springfield. We’ve continued to restructure our hospital footprint so we can focus on providing the services the community most needs. We’ve also aggressively expanded our ability to provide primary care in Springfield, outlying communities and Arkansas. We added about the same number of employees in Arkansas we reduced here.

SBJ: Missouri isn’t on track to expand Medicaid in 2015. What effect will that have on providers?
Taylor: A lot of us are hoping if there is no expansion, there is at least some sort of reform to Medicaid that provides some relief to the issues. We are looking for those workarounds. Honestly, we are a good example of what will continue to happen in Missouri. OCH expanded in Arkansas, a state that expanded Medicaid.

SBJ: What about patients?
Taylor: Behavioral health is the most concrete example of what will happen to patients. There is a huge unmet need for mental health in this country. A lot of that population who needs help are the uninsured. Without expanding Medicaid and providing some sort of insurance benefits, you will continue to see people struggle. It impacts everything – it impacts the economy, it impacts the judicial system. When they aren’t helped, they don’t contribute to the economy and can be a burden on the judicial system. It’s an inconvenient truth that the largest provider of behavioral health in this country is the jail system.

SBJ: Is ACA working as intended?
Taylor: No.

SBJ: Why?
Taylor: Mainly because the Supreme Court determined the Medicaid expansion was not constitutional. The ACA was a balancing act. The idea was there would be revenue taken away from traditional governmental payment sources to fund the Medicaid expansion. That was part of the balancing act. The other part was more patients would be insured through the exchanges. If you have an aggressive and functioning exchange, the people who can qualify go on the exchange. You take a body of patients that were uninsured and now, either through commercial insurance or Medicaid expansion, those patients are insured. The government says to health care providers that will work because even though you are getting less government money, you are getting it back because you’re getting more uninsured patients now covered by commercial insurance.

In those states where there was no Medicaid expansion, all that happens is you take money away from the providers. The uninsured remain.

SBJ: Despite dozens of failed attempts, many still call for a repeal of ACA. Is it here to stay in 2015?
Taylor: Two things: First, there is a legal challenge that is interesting and may actually work for those who want it to work. There is a challenge focused on the funding of the subsidy for patients who go on the exchange. There is a question that’s not been decided about the constitutionality of the funding. That may well be determined in 2015. If the funding of the subsidy is challenged and it’s supported, the whole construct begins to collapse.

The second thing, there are literally millions of people who are getting insurance now through the exchanges that were not covered previously. I don’t think any politician, Republican or Democrat, is going to want to say to those millions you no longer get insurance. That is a political unreality. That won’t happen. Something may happen to ACA, there may be a challenge, but I think the genie is out of the bottle.[[In-content Ad]]


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