The VCU and University of Virginia Health Systems could lose a combined $386 million in federal aid between 2017 and 2022 if Virginia legislators don’t expand Medicaid or create a private insurance program in accordance with President Barack Obama’s Affordable Care Act.
VCU Health Systems is the largest provider of care for indigent, uninsured or underinsured patients in the state. Without the necessary federal assistance, some of that cost will be left for the university to cover, said Delegate Sam Rasoul, D-Roanoke.
“That’s money that VCU could be taking and putting elsewhere, investing in students, whatever VCU would like to do,” Rasoul said. “But instead they are going to have to subsidize significantly indigent care.”
Expansion of Medicaid in Virginia was a financial priority named in VCU president Michael Rao’s 2014 State of the University address.
Virginians have already lost out on about $5 million a day of potential federal funds since Jan. 1, Rasoul said. He worries that partisan politics could delay action even longer.
“There’s also a political reality here,” Rasoul said. “I hope that this political partisanship doesn’t keep us in complete gridlock.”
Current Virginia Senate budget proposals include a private insurer option, which would provide government-paid insurance for many Virginians who cannot afford to buy coverage.
Karah Gunther, VCU’s director of Government Relations, welcomes the compromise as long as the university’s goals are met.
“Beyond the financial implications, we have a long-standing mission at VCU Health Systems to serve the underserved,” Gunther said. “At the end of the day, it’s in line with our mission to extend coverage.”
To reach these goals, Gunther said VCU Government Relations employees have visited members of the General Assembly and testified in front of the House Appropriations Committee.
“Like many other issues that we have, where a policy decision can either directly or indirectly affect the health system, we go around and advocate for a position,” Gunther said. “And really, I think the biggest thing is that we try to educate about the impact of the decision on our institution.”
Opponents of Medicaid expansion worry that the federal funding is sustainable in the long run, Rasoul said. But he hasn’t heard any opposition from his constituents, only other politicians.
“In fact, I have not been lobbied by one group against Medicaid expansion, so I’m not sure where the groundswell of support is coming from against it,” Rasoul said. “But it certainly is not being seen here at the General Assembly.”
Sheryl Garland, VCU Health Systems vice president of Health Policy and Community Relations, said if the state doesn’t pass a budget with federal funding, VCU must continue to address the issue of finding funds to replace it. This means finding new ways to reduce the cost of providing services to a large, uninsured population.
Garland said it is difficult to estimate the financial impact of trying to meet the demands of those in need even with a large safety net of hospitals, community health centers and free clinics that serve the uninsured.
“There are a lot of unknowns; there are a lot of questions,” Garland said. “This is a tough issue.”
The General Assembly passing any plan to close the existing coverage gap is essential for VCU Health System’s future financial health, Gunther said. The longer hospitals wait to get indigent, uninsured or underinsured patients into insurance programs, the longer it takes to stabilize the costs of treatment.
“It is arguably the most critical issue for the health system this General Assembly session,” Gunther said.
Success for state university health systems and the General aAssembly might rely on the private insurance compromise, Rasoul said, but it means something else entirely for citizens of Virginia.
“Most importantly, it’s not a success unless we have access for every single Virginian to healthcare,” Rasoul said.