Why are California hospitals vulnerable?
In addition to low government reimbursement from Medi-Cal and Medicare 40 percent or more of the average hospital’s business significant labor shortages drive up costs, forcing hospitals to pay premiums of 150 percent or more of average salaries to secure temporary personnel. Unfunded mandates like seismic safety retrofit requirements cost California hospitals billions of dollars. Payments to hospitals from Medi-Cal California’s Medicaid health insurance program for 6.5 million low-income and disabled people are lowest among the 50 states. With average payments 77 percent of what it costs hospitals to provide care, providers accepting Medi-Cal are decreasing, taxing a fragile system. Hospitals fare little better with Medicare with payments covering only about 82 percent of the costs to provide care. In 2007, California’s hospitals provided $8.8 billion of uncompen-sated care, including a $2.1 billion Medi-Cal shortfall and a $3.3 billion Medicare shortfall. Why is hospital pricing uniq
