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Dear Jack,

Rural hospitals in Mississippi are in crisis, we are told. Unless they receive more money, some may close, apparently.

According to those keen to expand Medicaid, there’s an easy answer; more Medicaid. Rural hospitals, we are invited to believe, lose money because of the costs of caring for all those without health insurance. If only we would expand Medicaid, rural hospitals would be secure.

Unfortunately there are many in the state legislature – including some who call themselves ‘conservatives’ – who subscribe to this nonsense. It's worth taking a few moments to understand why Medicaid expansion will not safeguard rural hospitals.

Rural hospitals face a financial squeeze not because of a lack of Medicaid, but because Medicaid does not pay. Medicaid reimburses hospitals significantly less than the actual cost of providing treatment.

Every time a rural hospital treats someone on Medicaid, the hospital normally loses money. How would expanding such a loss-making system improve the financial position of rural hospitals? It wouldn’t.

The problem is not too little Medicaid, but too much of it. Drawing more people and health care providers into this loss-making system solves nothing – and might make matters worse.
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Those that run rural hospitals have to walk a financial tightrope. On one side, they need to take patients on Medicaid, but they do so in the knowledge that they will seldom be reimbursed enough to make any money from it. To balance the likely loss, they must also find and charge enough from insured patients to recoup what they lose on the Medicaid side.

Expanding the number of Medicaid patients would mean that they need to recoup more from insured patients, through higher premiums and charges. If rural hospitals were forced to this, they would discover that there simply aren’t enough insured patients to cross-subsidize the cost of treating those on Medicaid.

To a certain sort of lawmaker in the legislature, Medicaid expansion has become the answer to every question. What should we do about cash-strapped hospitals? More Medicaid! Or poor postpartum care? More Medicaid! Health inequality? More Medicaid!

It never seems to cross their minds that Medicaid might be the cause of these shortcomings. Anyone who questions Medicaid expansion is treated as if they actively want worse outcomes.

The demand to expand Medicaid has drowned out the case for making the kinds of changes our health system in Mississippi actually needs.

Did you know, for example, that the Mississippi Code explicitly prohibits any freestanding Emergency Room in rural areas, except in very limited circumstances? Having freestanding ER facilities in rural areas might make good sense. Insisting that there can only be an ER facility if there is a fully-fledged hospital attached necessarily limits ER provision in rural areas.

Across Mississippi, anyone looking to expand healthcare provision needs to get a permit – known in the businesses as a Certificate of Need. It is hardly surprising that after four decades of this protectionist red tape, the healthcare facilities in many parts of our state no longer match the actual demands of those that live there.

“Okay, Carswell” some will say. “These arguments are all very interesting, but what do I say to someone that only earns $40,000 a year and can’t get the healthcare that their family needs? We need to have practical solutions that will help them today”.

I agree. Change is needed to ensure that primary health care is available at a price that someone on a low income can afford. Other states show how this might be done, without expanding Medicaid.

That is why Dr Lee Gross, a brilliant physician from Florida is coming to Mississippi to explain how he provides affordable health care to ordinary families. Instead of asking for insurance or Medicaid, Dr Gross provides families with care using an affordable subscription model. It is low-cost, reliable and wildly popular.

Why not come along to listen to Dr Gross spell out the practical alternatives so that we might actually improve health care for low-income Mississippians?

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I hope you will join us!

Have a wonderful weekend.
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Warm regards,
Douglas Carswell
President & CEO

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