Business Review: Upstate hospitals to get $1B funding injection with new Medicare rule

The Business Review’s Sam Raudins reported on the announcement from U.S. Senate Majority Leader Chuck Schumer that reimbursement levels for Medicare patients — known as the Medicare Wage Index — will be increasing for hospitals throughout upstate New York. As part of her reporting, she spoke to Dr. Steven Hanks, president and CEO of St. Peter’s Health Partners in Albany and St. Joseph’s Health in Syracuse.

From the article:

Dr. Steven Hanks, president and CEO of St. Peter’s Health Partners, said the funding couldn’t have come at a more critical time. St. Peter’s is set to receive over $60 million per year, but once fully realized for both in-patient and out-patient care, Hanks said St. Peter’s will gain more like $100 million per year.

“To be honest, I’m not sure what we would have done if it hadn’t come through because the situation that the not-for-profit health systems are finding themselves in, particularly in parts of the country like ours where there’s not a rapid population growth to offset the increasing percentage of patients on a year-on-year basis that are government insured, it would have caused changes that I can’t even predict what they might have looked like,” Hanks said.

For St. Peter’s, the greatest need that will be addressed with the funding will be shoring up the hospital’s operating margin, which will open the door to make additional improvements.

“This is going to make it more likely that we’ll be able to hit a sustainable operating margin. In other words, making up on operating the business that we can reinvest in our physical plant and our technology. What has happened because we’ve been systematically underpaid, all of the Capital District hospitals haven’t had the same access to capital because your capital capacity is generated by our operating margin,” Hanks said.

Click here to read the full article.