Repeal and Replace Feels Like a Game of Red-Light/Green-Light

Do you remember the playground game called Red-Light/Green-Light?  All the kids line up on the blacktop or on the ball field. One kid plays the role of the stop light and faces away from the line of kids and says “green light”. At this point the kids are allowed to move towards the stoplight. At any point, the stop light may say “red light!” and turn around. If any of the kids are caught moving after this has occurred, they are out.

“Green-Light!” Several years ago, the Affordable Care Act launched and all the health centers are told to hurry up and build resources needed to absorb all of the newly insured patients that will soon overwhelm our clinics. We all move forward with investments in buildings, staff and infrastructure.

“Red-Light!” After several false starts, managed Medi-Cal takes over the insurance for our patients; messing up patient assignments, creating provider credentialing problems, losing specialty care networks and denying claims for months. Business at Peach suffers for a long while as we sort it all out.

“Green-Light!” The ACA continues to improve in California, more and more patients are insured and coming to Peach Tree for care. The demand for healthcare services by new patients continues to outpace our ability to supply new healthcare providers in our service area. So, we expand services again and hire more staff to keep up with demand.

“Red-Light!” Our new President and Congress promise to quickly and decisively kill the ACA and replace it with another healthcare insurance solution.  Yet there is no further instruction given to those of us actually providing care under the ACA.  I am left to wonder if my patient demand is about to slow again? Should we stop growing and hiring staff to keep up? Will our reimbursement rates change?  Which programs will lose funding?

Knowing our core business reimbursement program is about to change keeps us all frozen at the red light, waiting for further instructions to go again.  Healthcare leaders are concerned that further investments in their services may result in significant losses if millions of insured patients lose coverage.  One day we hear the ACA is going away quickly, the next day’s message may involve a long transition period. Perhaps the states may make their own decisions on Medicaid or a replacement program may result in no net change to our patients’ insurance. A half dozen conflicting healthcare proposals are “leaked” from Washington.  Nevertheless, there is no firm footing for providers in any of these messages.  Nothing we can use for planning. Everyone feels permanently held at the red light.

The process of waiting for instructions about a repeal-and-replace solution also affects the many businesses serving healthcare businesses.  We reduce the purchase of new medical and office equipment from our vendors, hire fewer employees through agencies and shelve expansion plans.  The uncertainty makes our banks less likely to invest in healthcare projects, property owners are hesitant to lease to healthcare companies with questionable future revenue, access to credit gets tighter and new physicians grow increasingly weary of working in clinics serving ACA patients.

As Peach Tree’s CEO, I struggle with these forces each day.  One day I feel the need to reduce spending and build our cash reserves, then the next day I feel the need to expand our services so we can care for the hundreds of new patients calling for care each month.  But I can’t do both.  If I take a defensive stance and the ACA does not go away, thousands of patients will be neglected unnecessarily.  If I press ahead with growth and our Medi-Cal structure collapses, I may put hundreds of employees and a key community health center at risk of failure.

We are now in March, and the current message from Washington about the future of the ACA did nothing to change the light to green.   Each day I feel like I am illegally running another red light in an effort to keep Peach Tree moving forward and our patients cared for.  I personally struggle to sit and wait at long red lights.  Waiting is waste and these delays are counterproductive to good health.