A state noted for a difficult financial environment for hospitals is promising to give facilities some cushion, but the assistance will come with some tradeoffs.
New Jersey Gov. Jon Corzine late last week signed a package of four bills aimed at providing assistance to hospitals and giving the state an "early warning" system that will enable it to intervene before a facility enters a crisis.
The bills also aim to improve access to care, protect the uninsured and boost transparency. The legislation comes as lawmakers note that action was necessary to help the state's healthcare providers.
"We cannot allow fiscal issues to cause another hospital to close its doors and further jeopardize the quality and availability of healthcare in New Jersey," said Herb Connaway Jr., an assemblyman from Burlington and a primary sponsor of the bill.
Data from the state's hospital association indicates that financial pressures have forced the closure of 23 hospitals in the state since 1992, and five others have filed for bankruptcy. Solaris Health System this past week announced plans to shutter Muhlenberg Regional Medical Center, the fifth facility to close in the state this year.
The New Jersey Hospital Association, which says half of its hospitals have lost money this year, supports the package of legislation but says more needs to be done, especially in solving the chronic underfunding of charity care and inadequate Medicaid reimbursements.
The bills signed into law by Corzine were supported by the Department of Health and Senior Services in response to the findings of the Commission on Rationalizing Health Care Resources, a panel appointed by the governor to review the state's hospitals and other healthcare services.
One bill authorizes enhanced monitoring of hospital financial performance by the Department of Health and Senior Services; if problems are found, the state can intervene to help manage hospitals undergoing financial distress.
Another bill prohibits hospitals from charging certain uninsured patients more that 15 percent more than applicable Medicare rates for care. Another requires hospitals to conduct annual public meetings for their communities, while the last extends educational requirements for all hospital trustees.
"These measures, combined with the stabilization fund we formally enacted in June, ensure that there is increased transparency, better financial management and long-term planning in place for all New Jersey hospitals," Corzine said.
Corzine recently signed legislation establishing the Health Care Stabilization Fund, with an appropriation of $44 million, to increase the financial stability of the state's hospitals.
The governor's office said the fund will "provide critical support and a mechanism for working with hospitals and other financially distressed facilities that face closure or significant service reductions."
The state's hospital association said the bills are a start, but they don't address chronic issues.
"As the Reinhardt Commission ... explained, the problems confronting New Jersey's healthcare system are rooted much, much deeper," said NJHA President Betsy Ryan. "We urge our elected officials to continue their efforts to stop the bleeding in our healthcare system and ensure a future of accessible, quality healthcare for residents in all corners of our state."