Michigan's Not-For-Profit Hospitals Spent $2.6 Billion In 2007 On No-Cost, Discounted Care

Main Category: Public Health
Article Date: 17 Sep 2008 - 12:00 PDT

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Michigan's not-for-profit hospitals spent $2.6 billion in 2007 providing no-cost and discounted care, according to a report released on Monday by the Michigan Health and Hospital Association, the Detroit Free Press reports. The association gathered data from 132 of the state's 146 not-for-profit hospitals (Anstett, Detroit Free Press, 9/15).

In 2007 Michigan not-for-profit hospitals provided:

• $2.1 billion in non-reimbursable medical care to state residents, including $209 million in charity care for low-income patients who qualify for no-cost services and $605 million in written off uncollected patient debts;
  
  
• $331.5 million for research, education and in-kind donations;
  
  
• $94.5 million in voluntary programs and services, such as no-cost clinics, health screenings, immunizations and prescription drugs; and
  
  
• $35 million for 224,000 no-cost visits to hospital- and community-based health clinics (Rogers, Detroit News, 9/15).
  

There are 1.1 million uninsured Michigan residents, 1.8 million state Medicaid beneficiaries and 1.5 million state Medicare beneficiaries. Hospitals and no-cost clinics "are stretched thin trying to provide care," with many clinics having waiting lists and not accepting new patients, according to the Free Press. David Seaman, the association's senior vice president, said most hospitals in Michigan are experiencing a 25% increase in the cost of providing free care as well as losses from treating people with government insurance and uncollected patient debt.

To offset the spending on no-cost or discounted care, some state hospitals are reducing staff and consolidating programs. Tom Marks, senior finance director and revenue cycle officer for the University of Michigan Hospitals and Health Centers, said hospitals with lower operating margins "have to make up the difference somewhere else," which often means higher charges to privately insured patients (Detroit Free Press, 9/15).

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