Emory Report

September 7 , 1999

 Volume 52, No. 3

First person

Michael Johns outlines Emory's commitment to Grady

Emory is deeply committed to Grady Memorial Hospital. Since its beginning, the hospital has been an integral part of Emory's patient care, teaching and research missions--and an essential part of our social mission, our commitment to the city and state, and how we view ourselves.

This is a tough time for health care in general, but Grady faces an unusually complex combination of challenges and pressures. This article tries to convey in a very few words some of these pressures (many also affecting our own hospitals) and some of Emory's long-term support to Grady.

Georgians everywhere utilize the nationally recognized centers of excellence headed by Emory physicians at Grady-programs in trauma, burns, HIV and AIDS, neonatal and perinatal care, poison control, sickle cell, community mental health, tuberculosis, pediatric asthma, hazardous materials detoxification, teen pregnancy and new mother drug avoidance. They benefit from the research programs there. One in four Georgia physicians was trained at Grady, to the benefit of his/her patients. Perhaps most significantly, Atlanta's healthcare system would be thrown into disarray without Grady, and Georgians would face a deepening healthcare crisis. Grady provides a safety net for the area's neediest citizens--often its sickest ones--and enhances the public health of the entire community, helping control infectious diseases like tuberculosis.

Increased pressures facing Grady today

  • Lowered reimbursements from the county coupled with a rise in uninsured patients. The Grady Health System is funded in part by reimbursements from Fulton and DeKalb counties for health care provided to uninsured citizens. Georgia is now sixth in the nation in terms of population with no insurance. Between 1992 and 1998, as uninsured patients and costs of care both rose sharply, the counties cut what they reimbursed Grady by $23.4 million per year.
  • Lowered reimbursements for insured patients. Forty-three percent of patients seen by Emory doctors at Grady last year were uninsured; another 51 percent were covered by Medicare or Medicaid, which also have sharply reduced what they pay for health care, sometimes dropping below actual costs of care.
  • Lowered reimbursement for teaching hospitals. The triple whammy to Grady and other teaching hospitals has been the severe cuts in Medicare reimbursement through the federal Balanced Budget Act of 1997, widely known as the BBA. The Atlanta Journal called the huge cuts in Medicare the single most crucial factor in the millions Grady is bleeding annually.

The BBA decreased Medicare payments made to all hospitals. But because Medicare funding helps underwrite physician education, the hospitals hardest hit by these cuts have been teaching hospitals, like Grady, which the same AJC editorial called "the incubators of medical advances that have made U.S. health care the envy of the world."

By the time the BBA runs its course through 2002, Grady is expected to have lost $55 million. (Emory Hospital and Crawford Long also see Medicare patients, and the BBA will cost them $47 million and $42 million, respectively, in lost revenues.)

Some of the ways Emory supports Grady

  • In the past decade Emory provided more than $190 million in uncompensated patient care at Grady, including an estimated $24 million last year alone. Next year's total should be in the same range.
  • In addition to vast amounts of uncompensated care, Emory also provides the hospital superb physicians; all Grady doctors are either Emory or Morehouse physicians. More than half of our medical faculty at Emory spend some or all of their time at Grady-the equivalent of 289 full-time physicians, many world-renowned for their expertise. This number has been constant for three years, as has the total medical faculty. Patient volume at Grady also has remained level.

Ninety-eight of these 289 physicians are supplied by Emory at no cost to Grady or the counties. Emory, like Morehouse, also underwrites healthcare costs and salaries of other Emory physicians partially funded by Grady, doing so through charges collected from insurers of patients seen at Grady by Emory doctors and additional money from Emory's own resources. These costs for Emory, together with some improvements to programs and buildings at Grady, totaled more than $30 million in 1998. Together with $24 million in uncompensated care, that means Emory provided more than $55 million at Grady last year alone.

  • Residency training is also a great support to the hospital. The massive volume of patient care at Grady-more than 750,000 patient visits and hospitalizations per year-is made possible physically and economically by the presence of 370 Emory and approximately 50 Morehouse residents or "house officers," young physicians receiving specialized training. These young physicians work long hours, providing patient care under close supervision of Emory and Morehouse faculty physicians, at salaries less than the average for nurse practitioners in the state of Georgia.

Residents also are largely "free" to Grady because the majority of their salaries are paid through federal and state funds for graduate medical education and from a variety of patient care grants. Grady also receives indirect medical education support from the Health Care Financing Administration as a teaching hospital. Without the resident physicians, roughly $20 million of underwriting of care at Grady would simply vanish, as would the patient care provided.

  • More than 100 Emory medical students and approximately 35 Morehouse medical students provide other services at Grady every day, such as transporting patients, at no cost to the hospital.

What you can do to help

First, write your senator or congressman to express concern about the BBA's deleterious effect on Grady and other teaching hospitals. Designed to reduce health care costs, the legislation is having an impact beyond what was foreseen. Several leaders in Washington are now rethinking it. Its current magnitude threatens medical education, care of poor people, quality of healthcare for everyone and research to improve the treatment and prevention of disease. E-mail addresses of Georgia's congressional delegation, Senate and House, are on Momentum Web at <www.emory. edu/WHSC/MOMENTUM> and are available to Emory users.

And second, when you see an Emory physician who works at Grady, say thank you.

Michael Johns is executive vice president for Health Affairs and CEO of Emory Healthcare.

Return to September 7, 1999, contents page