Economic Woes Beset Inner-City Hospitals

LAST year the Washington Hospital Center spent $41 million to care for people who didn't pay their bills. Many, probably most, were poor and had no insurance. The center also spent an estimated $5.2 million treating gunshot and stabbing victims last year. So far this year it's caring for nearly twice as many gunshot patients as in 1988, as drug-related violence explodes in several poor and heavily minority sections of Washington.

The center, a private nonprofit hospital, cares for the second-highest number of gunshot cases in America's capital city. Last year approximately 175 gunshot victims had no insurance; the hospital absorbed the cost of treating them - an average of $2,225 a person.

Hospitals in other American cities are facing these same challenges, and additional ones as well.

The upshot: ``Many inner-city hospitals are having trouble'' economically, says Joanne Tresley, a senior staff specialist at the American Hospital Association. ``In terms of operating margins,'' Ms. Tresley adds, some urban hospitals are in as deep economic difficulty as rural facilities, scores of which have closed in recent years.

Three of the most significant factors contributing to the financial woes of inner-city hospitals are a continued hold-down on government reimbursements for its medical programs, which provide 42 percent of most hospitals' revenue; an intense shortage of nurses, which has caused a modest bidding war for their services; and, especially in coastal cities, an influx of AIDS patients, most of whom have neither insurance nor personal funds, and who require costly care that can exceed $70,000 each.

``There are a lot of anecdotal reports'' that inner-city hospitals ``are just taxed to the limit, and [there is] a feeling that they are going to have to close their doors,'' says a staff member of the Senate Committee on Labor and Human Resources.

Generally, if an urban hospital were to close, authorities say, many poor and inner-city residents in that area would lose their access to medical care. ``The poor use hospital emergency rooms as their primary source of medical care,'' Tresley notes.

In Congress, concern is growing that budget-driven efforts of Congress and the Bush administration to decrease government's expenses on health programs would, if successful, have what the aide calls ``a devastating effect'' on city hospitals.

Several members of Congress and outside organizations are trying to prevent such a result.

Through its health programs for the elderly and the poor, in 1986 the federal government provided 42 percent of the money that hospitals took in, authorities say. In a report early this year the American Hospital Association noted that for six consecutive years Uncle Sam has increased payments for medicare, the government program for the elderly, less than the overall rate of inflation. While this has held down the formerly soaring cost of government spending for hospital care, authorities say that it also puts at risk the future of some inner-city and rural hospitals.

For these and other reasons, many inner-city residents who seek medical attention find that the safety net is fraying. Inner-city residents with two widely disparate types of requirements are in this situation, says Tresley. The result: Hospitals are having somehow to support them financially. ONE group is the elderly, whose need is more for assistance with personal needs, like hygiene and dressing, than for sophisticated technical aid. Often they could be released from the hospitals if they had relatives who could assist them or nursing homes that would admit them. Yet frequently they must remain in hospitals ``because there is no other place for them to go,'' Tresley says.

Many of the homeless are in the identical position. In both cases it is the hospitals themselves that absorb most or all of the costs of care.

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