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Obamacare repeal could cost Cook $300 million a year

Tuesday, February 21, 2017
Crain's Chicago Business
by Greg Hinz

February 21, 2017

Obamacare repeal could cost Cook $300 million a year

Stroger Hospital - Erik Unger
Photo by Erik Unger Stroger Hospital

Cook County officials are warning that an Obamacare repeal and the related expansion of Medicaid could cost the county health system—and, ultimately, local taxpayers—$300 million a year or more.

Cook County Board President Toni Preckwinkle cited the $300 million figure today in an interview after a rally in which she and others said "chaos" will result if the Affordable Care Act is not carefully replaced. The same number came from aides to Dr. Jay Shannon, CEO of the Cook County Health & Hospital System.

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Asked whether that potential hole can be handled without going back on her pledge not to again raise county taxes until at least 2020—a promise she made after pushing through a $244 million-a-year tax on soda pop and other sugary drinks—Preckwinkle replied, "I don't know what's going to happen on the federal level, and I'm not going to speculate."

But a moment later, she added, "We're not going to leave people untreated."

That would leave the bill for taxpayers.

Shannon, in his speech to a rally in front of Stroger Hospital, noted that the county has cut its subsidy to the health system by 75 percent in recent years, with payments dropping from $481 million in 2009 to a projected $115 million this year—"in large part due to the new revenues available as a result of implementation of the ACA."

Should the ACA be repealed without an adequate replacement, he said, "patients will go back to the days of choosing food for their families or the medications to stabilize their health. These are not choices that any human being should have to make, no less a human being living in the richest nation in the world."

Shannon's spokeswoman, Caryn Stancik, said the bulk of the potential lost federal money is in Medicaid reimbursements the health system receives for treating adults who gained eligibility under the ACA. Specifically, the risk would be roughly $100 million that the health system gets for treating these patients and another $100 million it passes on to private providers who see patients through its CountyCare health-insurance network. Then there's an estimated $100 million in charity care the hospital network would have to provide if Obamacare completely disappeared. Add that up, and the "conservative" potential hit is $300 million, Stancik said.

One county commissioner who has dealt with health care issues for decades, Evanston Democrat Larry Suffredin, said the number cited by Preckwinkle and Shannon strikes him as "low," and actually could be $450 million a year. Other hospitals also would be "clobbered," he said.

But amid signs in Washington that dominant Republicans may lower their sights, Suffredin said it's too soon to make any tax decisions. In theory, the county could cut way back on care, "but that would be very painful," Suffredin said.

Another commissioner, North Sider Bridget Gainer, said she does not think the above "worst case scenario" will happen. The real question, she said, is whether Congress will move to turn Medicaid into a block grant program, something that Gov. Bruce Rauner also has warned against.

A major cut in Medicaid reimbursements to the county "is possible," Gainer said. "But we don't know how much. Is it $50 million a year, or $150 million?"

Overall, the county says, a complete repeal of Obamacare could cause more than 483,000 of its residents to lose their health insurance.

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