Thanks to Congress, you are now paying more for other people’s health care. When I first began to study what is called “uncompensated care,” like most folks, I assumed that the cost of hospitalizations for those without health insurance was shifted to those of us with insurance. It turns out it is much more complicated than that. The vast majority of uncompensated care is covered by the federal government in two ways, emergency Medicaid and the U.S. tax code.

Dean Bailey

It is first important to understand who receives uncompensated care. The largest group is low wage earners who cannot afford to buy health insurance and/or who live in states that have declined to expand Medicaid coverage. These folks avoid health care until it is too late and use the emergency room for their primary care. In a medical emergency, they can qualify for Medicaid in 45 days. This will cover the hospital cost.

In addition, hospitals do not have to pay federal taxes as an institution as long as they offer uncompensated care. While there have been some changes in these laws from time to time, this has been the time-honored way for hospitals to cover uncompensated care. In hospitals, there is notice listing the number of members in a family and the income limits for both Medicaid and charity care, so patients can know if they can apply.

So, do those of us who have health insurance pay for the uncompensated care of individuals who do not have health insurance? Yes, but not how we commonly think. First we pay through taxes. Between what is not collected in federal income taxes from hospitals and emergency Medicaid cost, the federal government funds between $80 to $100 billion a year in uncompensated care.

However there is a second group of people who more directly impact increased hospital charges and increases in our health care premium and out-of-pocket cost. These are individuals who choose not to buy health insurance. As of the first of this year, no one is required to buy health insurance or face a federal tax penalty that was designed to help pay for federal cost of uncompensated care. In the recent Trump tax reform law, that penalty was removed. With the advent of ObamaCare, the number of people without insurance dropped from 18% to 11%, but has risen in the past year to 12.2%. This group will only increase with the recent change in the law.

How does this work?

Someone who has a respectable income, and who cannot qualify for emergency Medicaid goes into the hospital for an illness or accident. When they receive their huge hospital bill upon leaving, they either start paying a little at a time, or declare bankruptcy.

For smaller hospitals, the revenue they receive from patients with insurance does not cover the charity care they have to provide. The Portland Press Herald reported on this issue on Feb. 24 in an article about the higher fees that smaller hospitals have to charge. Hospitals have no choice but to increase their fees to cover this uncompensated care.

What can be done?

There are three ways to deal with this issue.

Congress can repeal the Emergency Medical Treatment and Active Labor Act, and the federal tax code covering uncompensated care. This would allow hospitals to refuse treatment to anyone without insurance. If they showed up at the emergency room they would be escorted by security out the door and could go home to recover or die.

Congress can continue to have a mishmash of laws and regulations that force the rest of us to cover the hospital cost of those who choose to not buy insurance. That’s what we have now, but with the recent changes, what the rest of us pay for their uncompensated care will only increase.

Congress can force everybody to have health insurance. Only if everyone is “all in” and everyone pays in some way for health care coverage, can we have a fair and equitable system.

I clearly prefer the last option. During the past five years, my wife and I have paid extraordinary out-of-pocket health care costs that our insurance does not cover. I’m 68 years old and I will never be able to retire because of those costs. I am tired of paying for others folks who choose to not buy health insurance.

While they have the right to not buy health insurance, I should have the right to not cover their hospital bills.

Don’t get sick in America.

Dean Bailey, MPA, LSW, is manager of special projects at Sweetser. He lives in Auburn.

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