Insurance issues arise again at KCH

MOUNT VERNON — Dave Rine, Martinsburg, is going to Newark to take care of his health needs. Rine recently switched to Med-I-Gold insurance for his supplemental insurance, and found out Knox Community Hospital does not take Med-I-Gold, thus the switch. But for Rine, the switch means more than taking his hospital business to Newark.

“Due to KCH not accepting many insurances like mine, they are forcing people to go to other cities to obtain hospital services,” Rine said. “This is hurting local vendors and the economy in Mount Vernon and Knox County.”

When Rine took his business to Licking Memorial Hospital, it was suggested that he use the services of its cardiac doctors. He did that, and also found a new family doctor in Newark.

“I did that because KCH bought Mount Vernon Family Practice and they didn’t take Med-I-Gold,” he explained. “Now I do all my business in Newark instead of Mount Vernon. I buy gas and groceries there. And I shop and eat out in Newark also. I know my doing this doesn’t have a big impact on the economy of Mount Vernon, but I am sure there are other people in this same situation. And this could impact the economy of Mount Vernon.”

According to Bruce White, chief executive officer of KCH, the statement “the hospital doesn’t take my insurance” is a bit misleading.

“The hospital takes care of every patient the exact same way, regardless of who their insurance is or whether they have insurance or not,” White said. “We’re a not-for-profit, charitable hospital and last year, in 2008, we provided $7.7 million worth of unreimbursed care to the people in the community. That consisted of charity care — people who just absolutely qualified for charity and couldn’t afford it, so we gave the care away for free.

“It also includes what we provide in the way of care for Medicaid patients for what Medicaid does not reimburse us. The Ohio Hospital Association tells us that the average hospital in Ohio, for every dollar spent providing care to a Medicaid patient, sees back only 86 cents. The other piece of that $7.7 million is bad debt — people who come in and indicate they are going to pay and don’t pay their debt. And we write that off as a bad debt.”

White said he wanted to emphasize the $7.7 million was the hospital’s actual cost for providing the care.

“So when people say to me the hospital doesn’t accept their insurance, I always have to hesitate a bit and say we do accept all insurances,” he said. “We will bill every insurance company on behalf of the patient. There’s darn few situations where we will not bill a particular payer.”

White said one of the biggest problems is how a particular insurance company chooses to reimburse for that care.

“It’s the insurance company that decides whether it views Knox Community Hospital as one of their in-network providers,” he explained.

For an insurance company to consider the hospital as being in network, the hospital has to accept what the insurance company wants to pay it.

“That’s where the real problem comes in,” White said. “In the case of [a certain insurance payer] we were out of network for 3 1/2 years with them. And while we were trying to work with them to get back in network with them, they continued to say they were only going to pay us this much or that much. And they were making proposals that were significantly out of line compared to other insurance payers.”

County Commissioners Teresa Bemiller and Allen Stockberger addressed the issue of what can be done to encourage people to stay in Knox County and spend as much money as possible locally.

“Certainly I understand there may be things that are not available in Knox County that people may have to go out of the county to purchase,” Bemiller said. “For [Rine], I guess this is a convenience. But I am a big advocate for people shopping here as much as they can because it does affect the bottom line here in the county. We just got new sales tax figures for here in the county and our sales tax revenue is down about $280,000. That is revenue we use to operate the county and provide services that the public wants.”

Bemiller pointed out that people shopping outside the county will pay a higher sales tax rate in any of the adjoining counties except Holmes County.

“And that money stays there,” she said. “It doesn’t go back to Knox County. So it does have an impact. If you have a lot of people shopping out of town, especially in this current economy, it is really hurting us. And I should point out that if people think they are going to get better deals at a bigger chain out of county, that is not necessarily true. Many of our local businesses can offer very competitive pricing if people would just go in.”

Bemiller also pointed out that the cost of gas to drive out of county and perhaps eating out as part of a shopping trip, could reduce or eliminate any savings perceived by those shopping elsewhere.

“So I would encourage people to support their local businesses, which in turn supports their county government, by shopping here as much as possible and giving local businesses a chance,” she said. “If people will make an effort to do that, it would certainly help in these difficult economic times.”

Stockberger agrees that keeping sales tax revenue is important to the operation of the county. Money spent outside the county also reduces revenues for local businesses and can adversely affect jobs and local income, he said.

“I think a P.R. campaign to encourage people to stay in Mount Vernon and Knox County to shop could be effective,” he said. “And if people realized the cost of going out of the county to shop they might stop and think about it. Now, I think sales tax on cars comes back to the home county, but otherwise it stays in the county where the shopping is done and helps pay for services to people in those counties. I think that’s a pretty good incentive [to shop locally].”