Why safety-net hospitals may be ‘on the brink of a precipice’

By Patrice Taddonio / FRONTLINE

Share this story

This story is part of FRONTLINE’s coverage of The Healthcare Divide,  co-produced by PBS FRONTLINE and NPR in collaboration with the Investigative Reporting Workshop.  The program examines how pressure to increase profits — as well as uneven government support — have increased the divide between rich and poor hospitals, endangering care for low-income populations.

The Healthcare Divide is also available to stream in FRONTLINE’s online collection of documentaries, on YouTube and in the PBS Video App

Since the coronavirus pandemic began, COVID-19’s disproportionate impact on Black, Latino, Indigenous and other communities of color in the U.S. has put a spotlight on longstanding and systemic disparities in American society.

On May 18, a new documentary, The Healthcare Divide, sheds light on a growing inequity in American healthcare: Many “safety-net” hospitals, whose primary mission is to serve the same low-income, working-class communities that have often been hit hard by the pandemic, are struggling to survive and have been for years — while profits at some other hospitals are booming.

“I think we’re on the brink of a precipice,” Dr. Bruce Siegel, who represents more than 300 safety-net hospitals around the country, as president and CEO of the trade group America’s Essential Hospitals, says in the above excerpt from The Healthcare Divide. “Even before the pandemic, many of these [safety-net] hospitals were losing money, and the pandemic is only going to make that worse.”

It’s a situation with serious implications for the health of the people these hospitals often serve, who are among the more than 70 million Americans reliant on Medicaid and the roughly 30 million who have no insurance at all.

“Unless there’s a substantive change in the way safety nets are funded, things are simply going to keep going in the direction they are, which is a great disparity in how patients are taken care of,” Dr. Chris Young, chief of the medical staff at Erlanger, a safety-net hospital in Chattanooga, Tenn., says in the documentary. “That divide is only going to grow.”

From FRONTLINE, NPR and American University’s Investigative Reporting Workshop, the new documentary examines the market forces and uneven government support that are deepening America’s healthcare divide — with profit margins in some sectors of the hospital industry flourishing throughout the pandemic, while many safety-net hospitals struggle to stay afloat.

These are often the same hospitals that have been seeing influxes of COVID-19 patients from communities disproportionately impacted by the disease, FRONTLINE producers Rick Young, Emma Schwartz and Fritz Kramer and NPR correspondent Laura Sullivan find in the documentary.

“Why are safety nets hit the hardest? Because our patients are vulnerable,” says Dr. Brad Spellberg, chief medical officer at LAC+USC Medical Center, a safety-net hospital that cared for a high volume of COVID patients during the winter surge earlier this year, as featured in the above excerpt from The Healthcare Divide. “We serve a community of working poor. We serve people who are working essential jobs. … We are expected to care for the patients the other hospitals won’t care for.”

That mission often isn’t profitable, due in large part to how healthcare is financed in America. The documentary goes on to explore how Medicaid’s reimbursements to hospitals are often lower than those made by private insurers — and how that disparity has made it more difficult for safety nets to cover their costs. The investigation also examines how the growth of hospital chains and the subsequent consolidation of the industry have created a progressively more competitive environment, making it harder for safety-net hospitals to live up to their mission and stay afloat.

It’s a situation that has only been intensified by the COVID pandemic, as hospitals that treat more “profitable” patients have often pulled further ahead, while many of those that treat more patients who are on Medicaid or are uninsured have fallen further behind.

“This system itself makes no sense,” Spellberg says, “and when you have a system that makes no sense, there are going to be some winners and there are going to be some losers. Is that how you want your healthcare to be delivered?”

Learn more about how many hospitals have struggled financially.

For the full story, watch The Healthcare Divide.