Obamacare Set To Drive New Wave Of Hospital Bankruptcies

Tyler Durden's picture

Back in 2008, one of the biggest arguments in favor of Obamacare was that the legislation would help alleviate bad debt at hospitals created by people who required emergency care but didn't have health insurance or the financial means to cover their treatment.  Of course, like most promises made about Obamacare, the exact opposite of the Left's original theories has played out in reality as restructuring lawyers are now warning that the healthcare industry is about to experience a massive wave of hospital bankruptcies.  Per Bloomberg:

A wave of hospitals and other medical companies are likely to restructure their debt or file for bankruptcy in the coming year, following the recent spate of failing retailers and energy drillers, according to restructuring professionals. Regulatory changes, technological advances and the rise of urgent-care centers have created a "perfect storm" for health-care companies, said David Neier, a partner in the New York office of law firm Winston & Strawn LLC.

 

Some signs are already there: Health-care bankruptcy filings have more than tripled this year according to data compiled by Bloomberg, and an index of Chapter 11 filings by companies with more than $1 million of assets has reached record highs in four of the last six quarters, according to law firm Polsinelli PC. Junk bonds from companies in the industry have dropped 1.4 percent this month, a steeper decline than the broader high-yield market, according to Bloomberg Barclays index data.

 

Since 1997, health-care cases have made up only 5.25 percent of all U.S. bankruptcy filings, according to Bloomberg data. Year to date, they already comprise 7.25 percent of all filings. Emergency-room operator Adeptus Health, cancer-care provider 21st Century Oncology, and cancer treatment specialist California Proton Treatment are the largest filings. Those statistics exclude pharmaceutical company Concordia, which is restructuring in Canada, and Preferred Care Inc., one of the U.S.’s largest nursing home groups, operating 108 assisted living facilities.

Hospital

So what has caused the sudden onset of hospital failures?  Well, because Obamacare's architects were so certain their legislation would completely eliminate uninsured citizens in the U.S., they decided to offset the costs of the "Affordable Care Act" by eliminating subsidy payments to hospitals that had previously been used to cover losses from treating uninsured patients...

Hospitals, including private rural ones, may be among the hardest hit, Winston & Strawn’s Neier said. The Affordable Care Act, known as Obamacare, reduced payments to hospitals that serve a large number of poor and uninsured patients, known as "disproportionate share hospitals," on the theory that more patients would be insured under the law. Congress delayed those cuts several times, but didn’t do so for the current fiscal year, which may "single-handedly throw hospitals into immediate financial distress -- many operate on less than one day’s cash,” he said in an interview.

 

"Smaller hospitals have already been struggling for years,” said Kristin Going, a partner in the New York office of Drinker, Biddle & Reath LLP. Both lawyers declined to discuss specific companies. Since 2010, a growing number of patients have enrolled in high-deductible health plans that force them to shoulder more of costs when they get treatment, according to the U.S. Centers for Disease Control and Prevention. That has translated into more bad debt from customers for hospitals and other providers.

 

Some publicly traded hospital companies that were already under pressure from high debt loads have been further buffeted by this year’s hurricanes. Community Health Systems Inc., with $1.9 billion in debt maturing in 2019, has suffered doctor revolts over crumbling, cash-strapped facilities, as well as losses linked to the storms in Texas and Florida earlier this year. A representative for Community Health didn’t return a call seeking comment.

...of course, here in reality, things didn't quite play out so perfectly as surging Obamacare premiums have pushed more and more people into  high deductible plans or have forced them to forego insurance altogether and opt instead to simply pay the tax penalties levied by the legislation.  Shocking that folks could simply absorb a doubling of their healthcare premiums in 4 years.

Just more proof that Obamacare is working perfectly and should be left just as it is...

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brewing_it's picture

Nobody really gave a shit when they passed Obamacare in the first place. It did not solve a single fucking problem, a simple expansion of medicare would have taken care of. But fucking Democrats had to blow the whole fucking health insurance market place up. They did not fucking care.

MagicMoney's picture

Relaxy buddy.... It is just politics.

CatInTheHat's picture

On one word or two: Universal healthcare.

We are FAR BEHIND other countries in this area.

 

As we are in others because this country is immoral.

It's the fault of the poor, right?

 

When will people LEARN??

ZD1's picture

When will delusional free loaders LEARN that socialist big government healthcare doesn't work? 

Carl Panzram's picture

If the government runs everything, there’s no one to complain too.

Faeriedust's picture

Never, because it DOES in every other nation on earth.  Hell, as of five years ago, it even worked in VENEZUELA.

 

Fourth Horseman's picture

STFU you public leech!

Fuckin' commies need to be sent ONE WAY to Venezuela to bask in the glory of their commie utopia ideas!

Thalamus's picture

Hopefully President Trump will look into the outrageous pharmaceutical price increases that occured the last few years under Obama, see https://www.cbsnews.com/news/generic-drug-price-increases-5000-percent-o... for example.  The drug companies have to be the biggest burden on the health care system next to fraudulent doctors and the uninsured.   See also https://www.reuters.com/article/us-usa-healthcare-drugpricing/exclusive-... .   Corporations are fascising the USA along with the Federal Reserve slowly like a frog.  

 

rejected's picture

At  $2000 a month premium and a $8- $10,000 dollar deductable who can afford the affordable act care?

William Dorritt's picture

Premiums up 400%, max out of pocket up 100% from $5K to $10K

IL property taxes up 400% over 15 years and still can't pay lottery winners on time

Have a friend in N Aurora who's property tax went from $4K to 12K in a year if I understood him correctly

George Will essay on Bankrupt IL; The Blue Model

Will omits the third leg of the corruption stool in IL, the Courts

http://www.sltrib.com/opinion/commentary/2017/11/19/george-f-will-in-ill...

 

gmacpherson's picture

Your chart left off Washington state. YOY benefits cost for same program participation increased two hundred seventy-three percent in 2017.

Obama didn't even let me keep the change...

>-(

joego1's picture

 

Rural hospitals closing = agenda 21

Robert A. Heinlein's picture

Since the Repubs tried and failed to get anything done, for which I'm glad because I though what they were proposing was no better, they need to walk/run away from this and let the dem's have the full credit they so richly deserve.  At some point even the lame stream media is going to start howling like an ally cat to get something done. Then that will be the time to get both sides to sit and act like adults.  Don't hold your breath on that though. 

Carl Panzram's picture

Get the gumbernate out of health care/insurance

arrowrod's picture

When a hospital goes bankrupt, do they burn it down?

Don't the debts get cancelled, and the whole charade start all over again?

New boss, same as old boss?

 

Too easy!

I am Groot's picture

Obozocare....just like herpes, the gift that keeps on giving you pain and suffering

Duc888's picture

 

We are headed towards single payer, which was Obamas goal after all.

Fourth Horseman's picture

Give whites clay and they'll build a city.

Give niggers a city and they will give you rubble.

Always has been always will be.

O'nigger care was a scam from the start to give useless eaters and societal leeches freebies and now the fruits of that nigger communism are coming ripe.

LET IT FAIL!!!

Put the system back the way it was. If an unproductive welfare leech can't afford it, they do not get it.!

Carl Panzram's picture

Niggers don’t have mental capacity to think about their future and plan ahead. It’s a hand to mouth mentality.

just the tip's picture

OT

over thanksgiving at other peoples house i saw some TV.  i don't have one.  i saw a number of lexus commercials.  they are exclusively geared toward minorities.  one for blacks. one for mexicans.  whites this year should buy lease some other brand and say fuck lexus.  just like what happened to the marketing for mcdonald's.  besides the poison in the food, their marketing was exclusively at blacks.  reap.  sow.

Carl Panzram's picture

Hahaaa haaaa Still holding my non-compliant ACA policy for$149/mo HSA 5000. Every year, I get a nice letter from my insurer informing me that I am missing out on important benefits. This year, I’m going to call that nice lady.

Faeriedust's picture

Note: every one of these poor, failing hospitals is a FOR PROFIT operation.  Every one of these FOR PROFIT chains pays out big bucks to CEOs and major shareholders BEFORE they pay for supplies, operating costs, or doctors.  They are run of, by, and for the PROFIT of a few insiders, and if they can't continue to PROFIT those ONE PERCENTERS, why, they just fold.  Because they aren't there to serve the people or treat illness and injury.  They are there for PROFIT!  If the costs can't be dumped onto the patient and the public, and the PROFITS can't be raked in hand over fist by the Owners, they have no purpose!  It's time we remembered that the backbone of America's superb health system was built on community hospitals funded by bonds covered by local governments, with the understanding that they would be non-profit institutions answerable to the community.  We need a healthcare payments solution that cuts out the overpaid administrators and executives, pays reasonable salaries to doctors who work for pride and love more than for money, and which cuts off the salesmen of overpriced gadgets at the knees.  

William Dorritt's picture

Oligarchs got their Monopolies: Govt Marxist Progressives got their Control

The goal of Muhammad Obama Care was to collapse the medical systems into an Oligopoly with a few Insurers, and a few providers.

Same model as every other industry in the USA, pay the politicians to regulate the little guys out of business for the benefits of the monopolies, and the rise of the oligarch class.

Oligarchs who bribed elected officials for their legislation must have all of their assets seized under Common Law, Unjust Enrichment and redistributed to their victims.

snblitz's picture

Please do not make me pay the same as you.

family of four $450 per month, $1500 total annual "deductible", million dollars per occurance.

I get 75% off the hospital master charge list just for breathing and can get closer to 90% if I ask.

You can too.

InnVestuhrr's picture

Solution to many problems, including this one, is trivially simple:

If you cannot pay for something with your own money, then you cannot get/have it.

This is the way the world used to work before central bankers, socialists, entitlement programs, social engineering, importing poverty, etc.

PiratePiggy's picture

Its worse than that. Where is the outrage over multi-millionaire Jimmy Fallon who doesn't want to pay his own medical bills but instead wants a free ride on the backs of the middle class tax payers?

Iambic PentaMaster's picture

This was known and baked in by Obama.

We all predicted it.  That lying scammer Jonathan Gruber absolutely knew it.

They did it to expand the Dependency Class permanently, consequences be hanged.

PiratePiggy's picture

> "This was known and baked in by Obama."

 

"Arbeit Macht Frei"

"If you like your doctor, you can keep your doctor."

dunce's picture

obama care was supposed to provide free health care to illegal aliens and the families. They got free health care anyway because hospitals were required by law to give it to them but that bankrupted hospitals with high concentrations of illegals. By federalizing it all the taxpayers would pay for their free healthcare. California needed lots more money for the illegal aliens they brought in. The feds helped via the department of education pouring funds in  to schools to educate the illegals. The insurance companies kicked back some funds to democrat campaigns that mandated people buy their insurance.

teslacoil's picture

Fuck all the leeches.  If they can't afford it, die.

How come they don't get free auto insurance?

Let these corrupt, mismanaged hospitals go under.

Socialism doesn't work, never has, never will.

Dan'l's picture

ObamaCare the gift that keeps on fucking Americans. Thanks, Barry, you fucking douche!

William Dorritt's picture

Deport 25-40 million illegal aliens:

  • Federal Deficit is eliminated almost completely overnight
  • Medical Systems are rid of 25-40 million free loaders, and becomes solvent overnight
  • Insurance Premiums drop drastically as policy holders are no longer forced at gun point to subsidize illegal aliens.
  • One Million Gang Members are deported, crime and shootings which bankrupt hospitals drop dramatically
  • Drug addiction drops dramatically as the Cartels lose their sales force
  • Democrats lose tens of millions of future welfare voters

 

SPQR 70AD's picture

exactly getting rid of the sub human spics niggers gooks indians pakis etc would fix a lot but it will never happen unless there is an armed revolt which will not happen either more then half the whites gleefully accept their genocide

William Dorritt's picture

Your comment reads like a false flag troll comment from Brock's employees who dominate the comments on the Hill, with the assistance or looking the other way from the operators of the hill.

Drop-Hammer's picture

No Little Dorritt, Senatus Populusque Romanus is spot on.  Stop being a white cuck and stand up for white men.  

William Dorritt's picture

NEWSFLASH

Matt Lauer & Charlie Rose released a joint statement with Rep Conyers and Sen Franken that Obamacare is a success and is achieving it's goals.

Lobbyists for the Oxy and Opioid manufacturers releases statements in support of the announcement.

Clinton and Epstein will be hosting a celebrity gala at Epstein's island which will be attended by many media, political and news icons.

Jeff Session's Justice Dept will be leaking details of the party via the Mueller-Comey-Rubenstein Investigation before the Grand jury hears any evidence, which in the case of Pedo Island will never happen.

RathdrumGal's picture

Just retired after 39 years as an ICU RN.  This was predicted back in 2009 if anyone was paying attention. The predictions back the was that 1 in 6 hospitals would close if Obamacare passed.  Thei first thing Obamacare did was cut 500B out of hospital reimbursement, long before the exhanes opened.

It breaks my heart.  We were doing good work.  I was working in a neuro ICU at the time.  The technology had progressed to a point where we could go into a patient's brain who was having a stroke and retrieve the clot.  You would see the stroke resolve before your eyes -- the patient would be able to speak, and regain the ability to move.  It was like seeing the dead come alive again.  Awesome.

But for these technologies to work, you need 1) rapid access to specialty facilities, 2) specialized procedure rooms with expensive, high quality imaging equipment, 3) staffed with specialized teams to do the procedure,  

Now the hospitals are increasingly staffed with foreign phyiscans who barely speak english, the young nurses no longer have the work ethic or espirit de corps to work together and get the job done.  Before I left, there was no sense of working together to save lives -- STAT no longer meant stat.

Stay healthy.  Eat your vegitables and wear your seatbelts.  Don't drink or do drugs.  Take an aspirin a day.  Excercise.  Lose weight if you are fat.  Save yourself.

Drop-Hammer's picture

The kikes whom Obamohammed set to task did what they set out to do which was to destroy our healthcare system.