News

Medicare a big money-loser for El Camino

El Camino Hospital is losing much more money from low Medicare reimbursements than similar hospitals in the Central Valley and Southern California, a study shows.

According to a recent report released by the California Hospital Association, El Camino isn't alone. Many hospitals in the Bay Area are losing more money on Medicare patients than comparable hospitals elsewhere in the state.

There are likely a number of reasons for this. However, the primary cause can be traced to the Bay Area's high cost of living, according to Ned Borgstrom, the hospital's chief financial officer.

In fiscal year 2013, the hospital reportedly lost $61.7 million on inpatient Medicare expenses and $32.3 million on outpatient Medicare expenses. Borgstrom said the hospital loses about $90 million on Medicare patients annually -- "not particularly bad compared to other Bay Area hospitals."

And while not good for the hospital's bottom line, the Medicare losses aren't going to put the hospital in dire straits.

"The hospital makes a healthy operating margin, despite its Medicare losses," Borgstrom told the Voicevia email.

The news shouldn't discourage Medicare patients from seeking care at El Camino, Borgstrom said -- even though there is anecdotal evidence that it is harder for consumers with Medicare coverage to find physicians willing to accept Medicare's low payments. That would never happen at El Camino, he said.

"The hospital is not more reluctant to treat Medicare patients," he said. "It treats all patients the same, regardless of pay or payment rate."

Asked whether he believes there might be a direct link between the higher losses on Medicare in the Bay Area and the tech sector -- which has come under increasing criticism for playing a role in driving up all costs in the region -- Borgstrom said he couldn't be sure.

"Bay Area hospitals have higher labor costs than elsewhere in California," he wrote. "It is not just a function of Silicon Valley ... so we can't trace a line directly to the high-tech sector."

Comments

 +   Like this comment
Posted by Amelia
a resident of Old Mountain View
on Mar 14, 2014 at 7:56 am

I do not feel sorry for these hospitals! Have you looked at how much they charge uninsured folks for tratment? Maybe hospitals should reconfigure how they do business and charge for services.


Don't miss out on the discussion!
Sign up to be notified of new comments on this topic.

Email:


Post a comment

Posting an item on Town Square is simple and requires no registration. Just complete this form and hit "submit" and your topic will appear online. Please be respectful and truthful in your postings so Town Square will continue to be a thoughtful gathering place for sharing community information and opinion. All postings are subject to our TERMS OF USE, and may be deleted if deemed inappropriate by our staff.

We prefer that you use your real name, but you may use any "member" name you wish.

Name: *

Select your neighborhood or school community: * Not sure?

Comment: *

Verification code: *
Enter the verification code exactly as shown, using capital and lowercase letters, in the multi-colored box.

*Required Fields

Sneak peek: Bradley's Fine Diner in Menlo Park
By Elena Kadvany | 4 comments | 3,326 views

Marriage Underachievers
By Chandrama Anderson | 0 comments | 1,638 views

Best High Dives to Watch the Game
By Laura Stec | 4 comments | 1,198 views