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Brian Lehrer: Brian Lehrer on WNYC. Whether Governor Cuomo stays in office or leaves, the New York state budget for the next fiscal year is due in just over two weeks, April 1st. So much for New Yorkers is at stake that could be affected one way or another by the governor's weakened position, you know about the debate over tax hikes on the wealthiest New Yorkers probably, you probably know at least something about the marijuana legalization bill, and maybe some others. With me now is Gothamist Health reporting contributor, Caroline Lewis, to talk about one budget item that's not getting very much attention, but that really should, especially in the COVID era, funding for New York's Safety-net Hospitals, which the governor is proposing to cut. Hi, Caroline, welcome back to the show.

Caroline Lewis: Hi, I'm excited to be here. Thank you.

Brian Lehrer: All hospitals in New York state are not-for-profit institutions by law, not everybody realizes that. What's a safety-net hospital? What does that designation mean?

Caroline Lewis: All hospitals have to take everybody, they can't turn people away, but some hospitals are designated as safety-net institutions because they disproportionately serve patients who are on Medicaid or uninsured. For some of those hospitals, the patients with commercial insurance is a very small or non-existent share of their patient base.

Brian Lehrer: Is that the same as the public hospital system, which might be the first thing that comes to people's minds, or not entirely?

Caroline Lewis: Not entirely. A privately owned or publicly owned hospital can be a safety-net hospital. In the city, we have NYC Health and Hospitals and they have 11 public safety-net hospitals, but they're also private safety-net hospitals, some of which are even more vulnerable because they are relatively independent or part of a small network. The city's public hospital system is actually doing okay at this point during the pandemic. They have been improving their patient revenue initiatives in recent years, and they seem to be doing all right. Maybe that's worth taking a closer look at, but some of the private safety-net institutions that I looked at are really struggling.

Brian Lehrer: For example, your article begins with a story from St. John's Episcopal Hospital in the Rockaways. Could you tell us why you started there?

Caroline Lewis: Well, I started there because I think that the story of St. John's offers a clear example of how the pandemic brought inequality and health care into sharp relief. On the Rockaways currently, because of all these closures of hospitals in recent years, St. John's is the only hospital serving the community. It's a community with higher rates of obesity, hypertension, diabetes, all these things that contribute to people being more vulnerable to severe cases of COVID. Queens in general was really overwhelmed by COVID, and St. John's really stepped up during the pandemic, but behind the scenes, it was still dealing with a lot of financial issues and was under pressure from the Cuomo administration to cut costs.

Cuomo hired a consultant to figure out how they could cut costs. They were trying to do that, but apparently it wasn't enough because then last month, this consultant TonyKorf Partners, suggested that they basically completely cut most of their services. Under one proposal, it would be a 15-bed micro-hospital instead of the 257-bed medical center it is right now. I think it was just a slap in the face to the community, after the administration absolutely knows what this hospital went through and the role that it played.

Brian Lehrer: What's the larger context for that? If they're proposing, at least one proposal is to reduce a hospital like St. John's Episcopal from 257 beds down to 15. I see it's on hold now, after a public outcry in the COVID era. What's the bigger context for that? There are a lot of these hospitals shrinkages, hospital consolidations that seem to constantly be in the news.

Caroline Lewis: Safety-net hospitals in general, because of the way healthcare is funded, are often on shaky ground. In some cases, they end up losing a lot of money, and they rely on other government subsidies to stay afloat. In New York, sometimes that looks like direct support from the state. St. John's, for instance, got $60 million last year to plug its losses. Sometimes the state just decides it doesn't want to deal with it anymore, and it either pushes for the hospital to join a larger system where they might cut capacity in order to cut their losses, or they push for the hospital to close or for severe cuts.

This is all leftover from the Pataki era when there was this task force called the Burger Commission on hospitals, and that's contributed, not fully responsible, but contributed to the loss of 20,000 hospital beds across the state over the last 20 years.

Brian Lehrer: Now, advocates of closing or consolidating hospitals say there's underutilization, meaning except for unusual circumstances like the pandemic surge in the last year, there are more hospital beds in New York than patients to fill them, as more and more medicine is done on an outpatient basis, which is generally seen as a good thing. Why spend money on empty beds? Where, based on your reporting, does that argument holds up, and where does it not?

Caroline Lewis: I am actually very eager to talk about this. There are conversations taking place in healthcare about how to modernize it, how to move away from costly settings like inpatient beds to outpatient care. Nowadays, when someone gets a surgery, they might not need to stay overnight. They might go to an ambulatory surgery center instead of a hospital, or someone might go to an urgent care instead of an emergency department. In poor communities, especially sometimes people use the ER as the front door to the health system, and there's this push to get people to go to a primary care doctor instead to manage their health instead of waiting for it to get bad enough to go to the emergency room.

All of those conversations are valid, in my opinion. We can talk about how to modernize the health system, and in that context, we can talk about how many hospital beds we need under normal circumstances and how many hospitals we need, but we are not asking people on the Upper East Side to choose between primary care and hospital beds. It doesn't happen. Frankly, they have more of both. I think that that conversation gets exploited to justify cuts to safety-net hospitals and to justify cuts in certain communities that are really made on a financial basis. I also want to specifically address what Bill Hammond said last week on the show about people voting with their feet when it comes to hospitals.

People often suggest that the safety-net hospital down the road is expendable because if given the choice, you would rather go to Mount Sinai. First of all, when you're being taken somewhere in an ambulance, you may not have the choice. Second of all, is a bit of a self-fulfilling prophecy, because who wants to go to the hospital that's chronically under-resourced? Again, that goes back to the way that healthcare is funded.

Brian Lehrer: Listeners, we want to open up the phones for Caroline Lewis, WNYC and Gothamist Health Contributor. If you work at a safety-net hospital, help Caroline continue to report this story. Call in and tell us how your hospital serves your community and what kinds of funding needs or disparities you see, compared to the ones that tend to serve wealthier patients, like in the distinction that Caroline was just making. 646-435-7280. If you work at a safety-net hospital, or if you've been served as a patient at a safety-net hospital, or anything else that you would like to say or ask about this at 646-435-7280.

Let me go back to something that you said a little while ago, and this was in your story. I see you tweeted this the other day as a little bit of a breakout. The distinction between these private safety-net hospitals that treat poor people in New York City and a public hospital system, and that the public hospital network brought in $353 million more inpatient care revenue in 2020 than in 2019, even though they also serve primarily poor patients and are also primarily funded by Medicaid reimbursements. How do you explain the difference?

Caroline Lewis: I think it's unclear at this point. Basically, that came from a report that the CEO of the health system filed with the board of directors, and one of the reasons he cited for getting more revenue was that patients were sicker during the pandemic. There was more complex care needed and that might be reimbursed at higher rates, but that's true of all hospitals. Other CEOs I talked to of safety-net hospitals said that the patient volume they lost was not made up for by treating sicker patients. The public hospital system, I know, has also been doing other things to improve its revenue in recent years.

For instance, I know that when Mitch Katz, the current CEO, came in a few years ago, he said he was going to try to have the health system do more complex procedures. Things that in the past, they might have sent people to other systems for, to try to keep that revenue in the health system and things like that. I think it is actually really worthwhile to get the public health hospital system to elaborate on that. I think they also have just the sale that they're at and the role they play in the health system in the city might have helped as well.

Brian Lehrer: For your article, you spoke to the leaders of five safety-net hospitals across the city. You report they advocated for broad changes to how healthcare is funded, if hospital equity is to be maintained, or improved. What changes? I'm curious, for example, if these hospital administrators, and you don't often hear this from hospital administrators, so I'm curious if in this case they were advocating for single-payer style Medicare for all style health care, so everyone's medical care gets compensated at the same rates. New York hospitals haven't always seen that as being in their interest. What did you hear along those lines or any other lines?

Caroline Lewis: I think opinions on single-payer are mixed, but I do want to take a step back to just explain how healthcare is funded under the current system, and how that would change under a single-payer. Under the current system, when someone with Medicaid, and that's nearly half of the people in New York, it's not some marginalized minority. When someone with Medicaid goes to a hospital, they earn typically about 73 cents per dollar of care that they're providing. They earn less than the cost of care, it pays less than Medicare, which is a federal program for people 65 and older, which pays maybe about 90% of the cost of care.

Then hospitals are basically expected to make up for those losses by serving people with commercial insurance, which pays about twice as much on average as Medicare. A safety net hospital that doesn't have a base of patients that have commercial insurance can't really make up for those losses. That's why they rely on state subsidies or other subsidies. It also provides some perverse incentives for what are supposed to be nonprofit hospitals that really have to act in this cutthroat business-like way in this current environment. Basically, there's a disincentive to provide care to poor people, that's what I'm saying.

Single-payer would mean that everybody was on the same government health plan. Hospitals serving rich and poor patients would be on equal footing. When people talk about single-payer, I think they recognize wealth redistribution in the way the taxes work. I don't know if they recognize that there would also be wealth redistribution in the way that resources are distributed within the health system. I think that when people talk about what needs to change, including these hospital CEOs, they said, first of all, we need higher Medicaid rates.

I think they recognize that Medicaid already accounts for $80 billion. Not $80 billion of the state budget, but $80 billion overall, of which the state pays a portion. A large share of the budget. I think that because Medicaid provides really widespread and coverage and good benefits, it's expensive and they recognize that it's hard to just raise Medicaid rates without changing something in the system. Everybody I spoke to said that. I think they disagree on necessarily what the solution is. A couple of people said single-payer might be the answer, not necessarily at the state level, but at the national level.

One person pointed to Maryland's all-payer system in which the state regulates the amount of money that hospitals get paid. It's the same for Medicare and Medicaid and commercial insurance. Others pointed to other potential solutions. I think that it's a moment though when it's important to recognize that this is not about cuts and upcoming budget, but it's a moment to recognize that there is deep-seated inequality in the health system, and that maybe, given the other problems with our health system beyond that, we might need to look at an overhaul.

Brian Lehrer: We're going to continue in a minute with WNYC and Gothamist Health reporter Caroline Lewis. We have some great callers standing by. Molafa, a physician in Montclair, trained at a safety net hospital. We see you, don't go away. Lisa in Rockaway calling about St. John's Episcopal, which we talked about before, don't go away. We're going to bring out some of these other striking disparities that people in the general public just weren't aware of before the pandemic, like a number of other disparities. What Caroline was just saying about how hospitals are reimbursed how doctors and other providers are reimbursed is well known in the health field, but not that known to the general public.

When you see somebody for a health-related service, they're not getting paid the same if you're on Medicare as if you're on Medicaid as if you're on private insurance, generally, and that affects so much about how our health care comes out. We're going to continue on this in a minute. Brian Lehrer on WNYC 646-435-7280. Stay with us.

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Brian Lehrer: Brian Lehrer in WNYC as we continue with WNYC and Gothamist Health reporting contributor Caroline Lewis, whose really important and interesting new article and Gothamist is about the safety-net hospitals in New York City and proposals to cut their funding, and the New York state budget that's now under consideration in Albany, and a lot of really great deep background information on how different hospitals work in New York City. Molafa, in Montclair, you're on WNYC Hello, Molafa?

Molafa: Hi Brian, how are you? Thanks so much for taking my call.

Brian: Sure.

Molafa: I'm a physician here in Montclair. I'm a direct primary care doctor and I trained in a safety-net hospital, a community hospital in Providence, Rhode Island, through Brown University for family medicine. I saw firsthand how important establishing health care that's accessible to a community. There's a reason they call them safety-net hospitals. It's a place that people can feel confident and feel secure, knowing that it's there. Of course, primary care and health care has evolved over the last 50 years. You were speaking about this already with your guests, hospitals are not what they used to be and don't serve the same purpose, so many things around outpatient.

I saw firsthand how our hospitals bought up by a larger system, who really concerted efforts slowly dissolve resources away from our hospital. As I trained there, more and more units shut down. Ultimately, that hospital completely has been shut down. It's such a sad thing to see. Providence is a small city, but that institution being there was a safety net for people. They could see it, they could walk to it. Women in labor would walk into the labor and delivery. They really knew that the people in the communities, it was a very friendly atmosphere. That's something you don't necessarily get.

You guys also spoke about the fee for incentive, a fee for service incentive model, which really pushes people, administrators and hospital systems to want to only get people with certain types of insurance. This is where primary healthcare is so backwards. Primary care is not emphasized. Really, for me as a primary care doctor, as a family medicine physician, my focus is on how do we get people the care they need, so they're not ending up in the hospital and that they have trust in the system. That's a huge issue. I think about this every day, I'm so glad to hear somebody speaking about this. It's a huge issue.

Every time one of those hospitals shuts down, we're leaving a gap. Primary care is not being focused on as it needs to be focused on public health. We've seen this throughout the pandemic. When we shut those hospitals down, there's a gap for people. Not necessarily that the hospital has to be there exactly the same way it was 50 years ago. How do we know we reutilize the resources of focusing on Community Health, focusing on primary care, especially underserved populations, and shoring up the communities in the way we need to really pull our communities forward to a healthier direction?

Brian Lehrer: Doctor, how do we? Can you answer your own question?

Molafa: Well, I'm so glad you asked. I trained a family medicine physician and I had a specific interest in underserved communities. I loved where trained at Brown University. An amazing group of doctors, amazing staff and I went through the system thinking that I would go straight into a Community Help Center and serve that population, which I did for a short time. What I've seen is that it's not a sustainable model. For me, I became a mom and I had a family of my own. I ended up choosing a different path, which is direct primary care. It's often a controversial topic because it can be seen as a way to limit the types of people that have access, but I chose it as a way to allow patients to access my services regardless of their health status in an affordable way.

I think public health has to improve in a vast way, and that's a long and deep process that has to happen. The focus has to really be on creating an institution of healthcare which does not exist. We're a fragmented system that's pulled together by different types of reimbursement models. This is not a true healthcare system, but a way that only certain people have access to health care at certain times. We really need to focus on healthcare. Some physicians like myself may have moved to this model, but even though I'm doing this, I'm never going to give up my idea that we need to focus on policies that really bring direct access to doctors for all types of patients regardless of your health insurance status.

We can get deeper into whether a single-payer system would be good for that or other types of systems, but just fundamentally, that thinking has to change rather than a fee per service model where you're only incentivized to do more things to get more money. It goes away from that preventive, you don't get paid to prevent things. You don't get paid to have an hour conversation with a person about their fundamental lifestyle habits that will really affect their overall health and well-being. It's also a hard thing to study, so it's easier to say, "We should just pay a fee per service. That's what we've been doing, and we should continue trying to tweak this system."

I think, fundamentally, that system has to change. Of course, it's a much longer conversation about what model do you use to do that. Primary care has to be the focus.

Brian Lehrer: Doctor, thank you for your service. Thank you for thinking so deeply about these issues, and thank you for calling and sharing some of your thinking on it with our listeners. This was really great.

Molafa: I appreciate you taking my call. Thank you.

Brian Lehrer: Molafa, in Montclair, calling in. Let's go next to Lisa in Far Rockaway, calling about the hospital we were just discussing before, which is at risk of closing or drastically shrinking in Far Rockaway. St. John's Episcopal. Lisa in Far Rockaway, you're on WNYC. Hi there.

Lisa: Hello. Thank you so much for taking my call, Brian, and for everything that you do, and thank your previous caller. She was wonderful. I'm calling about St. John's. The fact is that they keep talking about how many beds the hospital has. That's really important, but I think it's equally important to understand that a place like St. Johns provides a huge number of other services besides what is given to people who are admitted to the hospital. I went to their Wound Care Center when I had weeping sores coming from my legs, and they did a fantastic job of curing me.

They have a very diverse physical and occupational therapy department, which has equipment and people who are trained to treat things that you can't get in small physical therapy places. They have the only treatment for lymphedema, which I have, within the city as far as I know, or at least within queens.

Brian Lehrer: You personally have used them?

Lisa: There are huge services. Yes, absolutely.

Brian Lehrer: For a variety of things, that you don't want to go away from being available in the neighborhood?

Lisa: Well, it's not just that I don't want to go away. I'm disabled, I can't go away.

Brian Lehrer: I'm saying you don't want the services to go away, but of course. Lisa, thank you so much for that call. That really puts it out there. There are all kinds of things that hospitals do for people in the communities, not just inpatient beds. This is WNYC-FM HD and AM New York, WNJT-FM 88.1 Trenton, WNJP 88.5 Sussex, WNJY 89.3 Netcong, and WNJO 90.3 Toms River. We're in New York and New Jersey Public Radio. A few minutes left with health reporter Caroline Lewis on the fate of the safety-net hospitals in New York City.

Caroline, we've talked mostly as an example about St. John's Episcopal in Far Rockaway, there were five in your article that you profiled.

Again, these are not the New York City public hospitals, these are other private safety-net hospitals that serve a lot of low-income communities in New York. You want to just give us the list of the other four, so people know precisely what we've been talking about.

Caroline Lewis: Sure. These are not all hospitals that are on the verge of closure,, to be clear. I just wanted to check in with the safety-net hospitals and see how they were doing. I spoke to leaders from Maimonides Medical Center. I spoke to LaRay Brown, the leader of One Brooklyn Health System, which encompasses three hospitals, one of which is about to lose all its inpatient beds in Central Brooklyn. I spoke to the leader of the Brooklyn Hospital Center in Downtown Brooklyn, the leader of SBH Health System in the Bronx, and also St. John's in Queens.

Brian Lehrer: Before we run out of time I want to take one more call, which is going to put it back in the realm of the news hook for this, which is the New York State Budget in negotiation in the legislature now and between the legislature and the governor's office, which has a lot of this health care funding at stake, including whether Medicaid reimbursement rates are going to go down, and related things. Mark in the East Village is apparently looking at that aspect of it. Mark, you're on WNYC, thank you for calling in.

Mark: Thank you for taking my call, and thank you, Caroline, for your wonderful article last week. I just wondered if you could expound a little bit in the time left about the cuts that the governor has proposed in his budget proposal to safety-net hospitals. From last January, most of the legislature has rejected most of them, and they're one house bills, this previous week. That is the cuts to the vital access program for financially struggling safety-net hospitals, denying public hospitals across the state access to the indigent care pool, across the board Medicaid rate cuts that would severely adverse safety-net hospitals that have high numbers of Medicaid patients, and the cuts to the article six public health just to New York City and no other parts of New York State.

Brian Lehrer: Thank you very much, three specific things. Caroline?

Caroline Lewis: You actually hit on a lot of them. Basically, last year during the pandemic, Cuomo, he cut Medicaid rates by 1.5% across the board. He's proposing another 1% across the board cut in the upcoming budget. That's something that a lot of people oppose because, as we described before, not all hospitals are on equal footing. As Assembly Member Gottfried put it, a 1% cut to Medicaid funding for Mount Sinai may have very different impacts than 1%. Medicaid cut to Elmhurst. Some people are advocating that certain safety-net hospitals be excluded from that rate cut.

It also just shows how the pandemic has not changed anything. If anything, it's made things worse. There are other cuts included in the budget, for instance, a $99 million proposed cut to the vital access provider assurance program, which provides direct funding to struggling safety-net hospitals. Which interestingly, a state official said, was not necessary anymore. She was like, "We spoke to the safety-net hospitals, they don't really need this funding." Which I think some people who run safety-net hospitals would disagree with. Essentially, this is something that was proposed when the governor was trying to plug a $15 billion budget gap.

We might not be facing the same budget gap with the stimulus bill that came through from the federal government, and a lot of legislators oppose these cuts. I think it'll be interesting to see what happens in these deliberations over the next couple of weeks.

Brian Lehrer: Fascinating, very important, very underreported. Thank you for this. Caroline Lewis's article on Gothamist is Cuomo Pushes Cuts To Safety-Net Hospitals After They Stepped Up During Pandemic. Caroline, thanks. Keep it up.

Caroline Lewis: Thank you so much.

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