Many of us Baby Boomers remember being told by our moms to “clean your plate” at dinner. Why? Because our parents lived during the Great Depression, where money was not plentiful, nor were jobs. I recall my mom making a ketchup and butter sandwich for herself for lunch; she told me that she ate them often as a child during the Depression. Things aren’t quite that bad yet, but I know plenty of folks who have been laid off. Unemployment in New Jersey is up to 7.1 percent at last count, and it threatens to rise even further.

Healthcare is not immune from the impact of the recession. NJHA just did a survey of our member hospitals to see how the recession is impacting them. Some of the findings are instructive – and a bit alarming:

• 80 percent of hospitals reported an increase in charity care patients. That’s a likely sign of folks losing their jobs and, along with them, their health insurance. While that’s bad news for hospitals, the good news for patients is that even though they lack insurance, they are getting quality healthcare in their home state. Caring for the uninsured is part of hospitals’ missions, and it’s also a requirement in state law.
• 76 percent reported an increasing number of patients in the Emergency Room. Again, that’s a likely result of people losing health insurance, and it’s bad news for the healthcare system. The ER is the most expensive place to receive care, so increasing ER use fuels rising healthcare costs. Plus, it’s much better for patients to receive their care in a physician’s office or other setting, rather than waiting until a minor ailment becomes a full-blown emergency.
• Six out of 10 hospitals reported a decline in elective procedures as patients delay certain healthcare services. Even patients with insurance are avoiding costs like co-pays at this time. That loss of patients and procedures hurts hospitals’ revenues.

Those financial losses have a major impact on hospital employees. More than half of the hospitals in our survey reported layoffs in 2008, with another 21 percent anticipating layoffs this year. Those are tremendously difficult decisions for hospitals, but when the revenue from paid patients goes away or diminishes, and the number of patients without insurance goes up, something has got to give….

For communities and consumers all across our state, hospitals are a vital source of healthcare services, 145,000 jobs and so many other benefits. But they are not recession-proof – as we all, unfortunately, are learning.

Layoffs are occurring in many places of employment in New Jersey, including hospitals. Hospital layoffs often generate a lot of news coverage, largely because hospitals are integral parts of their communities – often the largest employer and a key driver of the local economy. Overall, healthcare is the second largest employer in the state.

Just about every day I read three to four newspapers – the ink-on-paper versions that get your hands dirty. But during the day, when I am at work, I often check a couple of newspaper Web sites for breaking New Jersey and national news. And I have noticed a recent phenomenon. When a hospital announces a layoff and it is reported on a newspaper Web site, there often follows a series of comments from members of the public about how this is related to free care to undocumented immigrants (often the phrase used is “illegal aliens.”) So I thought I should comment.

N.J. hospitals and healthcare facilities are wonderful institutions that provide quality of care to all individuals. There is no doubt that federal law requires hospitals to provide emergency care to all, regardless of their ability to pay. That requirement extends even further under New Jersey law, which requires hospitals to provide care to all persons in all settings – not just in the emergency room – regardless of their ability to pay.

The United States has close to 50 million uninsured residents, and the State of New Jersey has 1.3 million uninsured. The state’s own statistics show that N.J. hospitals provide close to $1 billion in state-mandated care to the uninsured. That number is based on what the state’s Medicaid program would have paid hospitals for those services, but Medicaid only covers about 70 cents of every dollar of care provided by hospitals. In reality, the value of the care our hospitals provide to the uninsured reaches $1.3 billion annually.

How much do hospitals receive back from the state for that $1.3 billion in healthcare for the uninsured? The amount is subject to the state budget process each year, but the current budget reimburses hospitals just $603 million for that care. The obvious underfunding, nearly $700 million this year, creates a budget hole for N.J. hospitals. Other holes exist in hospital budgets because Medicaid doesn’t cover the cost of care they provide, nor does Medicare, the federal program that provides health coverage for seniors. This is true for doctors and hospitals alike.

So believe it or not, we have a system where major government payers do not cover the true cost of caring for the folks who come through hospitals’ doors each and every day. You can be the smartest person in the world, but if you have a large number of your patients who are a combination of uninsured (charity care), Medicaid and Medicare, you are likely losing money on each patient you see – hence the layoffs. The layoffs are occurring now because hospitals used to be able to rely on investment income to plug budgetary holes, but nobody is making money on investments these days.

So where do the undocumented immigrants come in? They are a portion of the uninsured that receive care from N.J. hospitals all over the state, but they are by no means the largest component. We estimate that N.J. hospitals provide approximately $200 million to $300 million in free care for this population each year (on top of the almost $1.3 billion in state-mandated charity care we provide). That’s a lot of money, but caring for undocumented immigrants is just one component of a much greater problem. The larger issue for hospitals – and for patients and communities – is the growing number of uninsured. And most of these folks are good old American citizens.

NJHA was honored to hold a press conference recently with Commissioner of Health Heather Howard and the Workplace Blood Donor Coalition on the importance of giving blood. New Jersey, unfortunately, has a chronic problem with blood shortages, and our donor rate is far below the national average. As part of the event, we hosted our own blood drive here, and more than 50 NJHA employees, along with Commissioner Howard herself, donated blood.

One pint of blood has the potential to save three lives. New Jerseyans by and large are a generous group, and I encourage you to consider donating a pint of blood….or to organize a blood drive where you work. This month (which, by the way, is National Blood Donor Awareness Month) more than 70 blood drives have been scheduled by hospitals, other healthcare providers, blood centers and workplaces in our state.

Our hospitals transfuse 500,000 units of blood to our patients each year. This blood is essential for accident victims, cancer patients, burn victims, organ transplant recipients and premature infants and children having heart surgery. Unfortunately, most of us have had a loved one fall into one of these categories. Be a hero, and roll up your sleeve and give blood. Save three lives in the process. Be sure to eat and drink something healthy ahead of time. And let me know how you do. Whether you're a first-time donor or one of those regulars who measures contributions in gallons, I'd love to hear from you.

This is a very special time of year. I’m reminded of my own Christmases as a child when I see the excitement build in my son as he counts down the days. My husband and I do our best to teach him about the importance of giving, so he knows this holiday is about much more than shiny gifts under the tree. It is a time to give, and a time to give thanks for all we have. And it’s a time to help out those who do not have as much as we are blessed to have in our lives. It’s also an appropriate time to thank a wonderful, dedicated group of people that our state is very lucky to have, and that is the 145,000 people who work in our hospitals and healthcare facilities. These doctors, nurses, respiratory technicians, pharmacists, physical therapists, food service personnel, custodians (I could go on and name every job title, but I won’t!) are there for all of us 24 hours a day, 7 days a week. They work on holidays, when the rest of us are lucky enough to be home enjoying time with our families. They perform miracles each and every day of the week. And they are there whenever we need them.

My family, like so many others, has personally experienced their selfless care. When my son was just a toddler, we were decorating our house for the holidays. I put stocking holders spelling out “NOEL” on my mantle and began to hang stockings from each letter. Before I could hang the four stockings, my son toddled over and pulled the heavy gold “N” down and it hit his head. Blood spurted out, and we rushed him to the local hospital. He was put into a papoose to immobilize his arms and was quickly stitched up. The scar is still there, hard to see, but I know where to look when I pull back his hair. Those heavy gold letters were boxed up later that night and are somewhere in my basement, never to be used again. But the folks at that local hospital were there for us that night, and they are still there for all of us, when we need them. Thank you to all of the dedicated workers in our hospitals, nursing homes, hospices, home health agencies, rehabilitation hospitals, long term acute care hospitals, psychiatric hospitals and assisted living centers. Keep doing the great work that you do each and every day, even as the rest of us sleep or enjoy the holiday with our families. We thank you.

Someone recently asked me what my greatest hope for the Obama Administration is, and what my greatest fear might be. My greatest hope (from where I sit) is easy – that once he is sworn in, President Obama will tackle healthcare reform and provide healthcare coverage to the 43 million-plus Americans who do not have healthcare coverage. It seems to me that it was one of his top priorities as he ran for office, and I recall that exit polling showed that the need for healthcare reform was tied for third in terms of the issues most on voter’s minds as they cast their ballots for president.

My greatest fear is that his Administration will be so consumed with our nation’s economic woes that he won’t get to healthcare reform. But the irony is that tackling healthcare reform is essential to our nation’s economic recovery. Healthcare is 15 percent of the gross domestic product nationally. Hospitals are often the largest employer in the communities in which they serve. In New Jersey, healthcare is the state’s second largest source of jobs, with hospitals alone employing close to 150,000 New Jerseyans in full-time and part-time positions. All told, New Jersey hospitals are economic engines that pump billions of dollars in salaries, income taxes and purchased goods and services into the state’s economy.

But beyond the dollars and cents, hospitals serve as the safety net for all of those who lack health insurance. State law mandates that hospitals provide care (we call it charity care) to those who don’t have health insurance and can’t afford to pay. As the unemployment figures continue to rise in our state, that hospital safety net becomes even more essential.

So… hospitals provide jobs and add billions of dollars to the state economy, all while providing a vital service to all our residents. That, to me, makes hospitals an essential component of any economic recovery.