InnovaCare Responds to Dual Crisis of Financial and Natural Disaster in Puerto Rico

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Natural disasters are something that nobody can truly plan for. A nation can do its best to prepare for potential disasters, such as building tornado- or hurricane-resistant homes, but for those who don’t have the means, these precautions just aren’t an option. Even those who are prepared cannot ensure that their property – and even livelihood – might not be destroyed. Puerto Rico recently faced this horrible situation after the devastation and destruction wrought by Hurricane Maria.

The hurricane left the island devastated, and the residents are still experiencing the effects over a year later. Massive flooding, severe property destruction, loss of life, and lack of access to medical and other basic needs tarnished the daily existence of those affected by the hurricane. And while it has been a year since the initial devastation, Puerto Rico is still in the midst of recovery.

One of the worst aspects of the devastation was the realization of how ill-prepared Puerto Rico was to respond to a disaster of this magnitude. As a relatively impoverished region, many dwellings and businesses stood no chance against the wind and rain of the hurricane. The financial situation of the state was already in an incredibly perilous state, on the verge of bankruptcy. This further stymied efforts of recovery. Already in a dreadful fiscal situation, the Puerto Rican government was faced with an impossible mission.

The problems faced by Puerto Ricans after the disaster were manyfold. There was a lack of food, medicine, electricity, and other basic services that we often take for granted. Generators were the only way that many medical establishments could keep their doors open, which are expensive and only last so long. There have been a wide number of relief efforts undertaken by non-profit organizations, and even corporations like InnovaCare, a medical services provider that has stepped into the fray to help offset some of the issues associated with the lack of medical supplies and facilities as a result of the storm.

While many individuals, businesses, and nonprofits have tried to step in to assist in the recovery effort, there have been some huge setbacks that have really made what was an already bad problem for Puerto Rico even worse. As noted above, Puerto Rico, a territory of the United States, has been teetering on the financial brink for many years. Before the hurricane, there was a lot of talk about what measures should be taken to ensure that the Puerto Rican government was able to service the debts owed to a variety of financial institutions.

With business pretty much coming to a halt because of the storm, the financial troubles were only compounded and, while the nation is trying to recover and get back to the tasks of daily life, the legislators are also facing an unwinnable financial situation. They’re having to make cuts and sacrifices that make the recovery process and the ability to provide for the needs of the least among us far more difficult.

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While the recovery process is moving along, setbacks keep popping up that make it incredibly difficult to maintain a positive outlook for the future. The debt of Puerto Rico is a huge concern for lenders, the United States, and other involved parties. With an ailing economy, the only way to manage these debts is to take austerity measures. This essentially means doing away with costly, but incredibly important, social programs as a means to reduce spending to get the nation’s economy back on track.

However, as Rick Shinto and Penelope Kokkinides of InnovaCare note, the area where the most sacrifices are made is the Medicaid program that so many low-income residents and their families rely on. The government of Puerto Rico had to make a deal with the federal government regarding debt repayment and are requiring some $840 million in reductions to Medicaid spending in Puerto Rico by 2023. This is a massive cut to a program that provides life-saving services to millions of residents, including the elderly and children. The government of Puerto Rico, however, is facing a crushing $70 billion in outstanding debt.

These cuts will have a severe impact on the low-income population that relies on Medicaid and related services. Puerto Ricans, on average, make about $20,000 a year. Diabetes, hypertension, and other similar illnesses are just as common on the island as on the mainland. These things all combine to create a disastrous situation that makes the future look rather bleak for many of the residents who rely on these services and are trying to rebuild their lives after a huge natural disaster. This crisis doesn’t seem like it will abate in the near future, leaving nonprofits, and corporations like InnovaCare, to pick up the slack and provide much needed services to communities in need.

There are, justifiably, many critics of this move. Doctors and other experts in the medical field talk about how this will leave far too little money to deal with the real medical needs of the population of Puerto Rico. They also fear that these cuts will make it easier for private insurance companies to take advantage of their Puerto Rican customers. All of these fears are justified, and it’s unclear what the future holds for the island as a result of this seemingly perfect storm of financial catastrophe and natural disaster.

One of the biggest problems and outcries about these cuts is that the amount of funding was already not enough. As Rick Shinto notes, even before these cuts, the U.S. government contributed but a fraction to the Medicaid budget of Puerto Rico when compared to what it provides for states. This is another area where being a territory – rather than a state – within the United States, has put the nation at a severe disadvantage.

There are already plans in place for these cuts, including the laying off of social workers and nurses. If Puerto Rico were an official state in the Union, the federal government would provide as much as 80% of the cost of the program – which it does in a number of states. However, since Puerto Rico is a territory, the assistance was only about 19%, paid in an annual block grant. This is, obviously, a significant difference, and makes an even bigger impact when one considers the economic strain the territory has been under for some decades.

Congress approved a stop gap measure to help cover Puerto Rico’s Medicaid costs, but the money is expected to run out by next year, and is really just a drop in the proverbial bucket of what they need to provide for their citizens. These and other measures were undertaken by Congress in an effort to help the territory get its financial situation under control, negotiating with lenders and trying to restructure the budget. These measures have mostly crippled the government of Puerto Rico further, making it almost impossible for it to respond to the needs of residents.

Many people familiar with the situation in Puerto Rico note that private insurance already has monopolies on the island, forcing patients into a narrow network of providers, and limiting their choices and the availability of alternative options. This already makes the availability of island-wide providers a difficult thing to find. And the proposed cuts to Medicaid are not just drastic; they are catastrophic. As Penelope Kokkinides notes, these cuts have the potential to cut as many as 1.1 million people off Medicaid. The total number of people enrolled in the program is 1.6 million.

Poverty is a real and looming issue for the Puerto Rican government, as around 50% of the population qualifies for public assistance and Medicaid. Just this staggering figure helps put into context the huge problems these cuts to Medicaid will have on the people of Puerto Rico. The burden of these cuts will fall disproportionately on the poor and aging populations. Companies like InnovaCare are stepping up to provide some relief and services for the people of Puerto Rico.

Many InnovaCare patients and care providers were affected by the hurricane. In response to the hurricane and the need for quality medical services, the company launched what they dubbed Caminamos Juntos, which means We Walk Together. Teaming up with Bacardi, InnovaCare sent caravans with much needed supplies of food, water, and other basic necessities to over 30 towns across the island in the direct wake of the storm. They also set up tents to provide free medical services to residents in need. In addition to immediate medical services, they also offered free follow-up services, helping some 200,000 residents in the aftermath of the storm.

Even before Hurricane Maria hit the shores of Puerto Rico, there were a lot of problems associated with large medical costs coupled with ever-increasing national debt. Since Puerto Rico is not an actual state, the island has been trying to cover these costs with money it doesn’t have, while also attempting to figure out how to manage and eventually get out of the spiraling debt it faces. Even in 2017, there was a lot of talk and concern about the state of Puerto Rico’s healthcare situation. For years, hospitals, doctors, and other healthcare providers have complained about how long it takes the government to pay its bills. This has led to a flood of doctors leaving the island and medical facilities putting off improvements and repairs while waiting for payment.

The delays in payments have meant that Medicaid recipients are often forced to wait long periods before receiving the medical care they need. For example, the wait is often as long as six months to see a children’s neurologist, and as long as three years if a child needs to see a genetic specialist. It is easy to see how this has a dramatically negative impact on the health and general wellbeing of the island’s children. The new cuts are likely to only further exacerbate this problem. There are calls to end the federal cap on Medicaid spending, which would allow the federal government to provide more assistance to the Puerto Rican government. There are also renewed calls to grant the island statehood.

All of this is coupled with the expectation that the costs of healthcare will continue to rise, as has been the trend. A fiscal analysis board has projected that the island’s costs for Medicaid patients could increase by as much as 40% in the next six years. This, combined with the dramatic cuts to Medicaid and the looming financial crisis, have many people truly concerned for what the future will hold for the low income residents of the island. Efforts are underway to expand the offerings from private insurance companies, including island-wide services. The government is looking at measures that will help encourage competition, hopefully, drive down the costs of expensive medical services.

Many hospitals are concerned that the push to drive down costs may put them out of business, which will reduce the overall availability of healthcare on the island. Many are still trying to handle the increased costs associated with hurricane recovery, including the massive costs of fuel for generators that many medical facilities are still relying on to keep their doors open to patients. These fears are legitimate ones, and there doesn’t seem to be much in the way of ideas about how to ensure that increased competition doesn’t lead to the closure of rural healthcare facilities that cannot compete with larger healthcare systems in more urban city centers.

There are still many people who have yet to return home after the devastation of the hurricane. There are still many medical facilities that are inoperable due to damage. And all of this is combined with the crushing debt that the island faces. The austerity measures that have been proposed to help deal with the debt crisis have the potential to ignite another crisis, but this one a humanitarian one, rather than a natural one. The proposed cuts to Medicaid could see the vast majority of those currently enrolled in Medicaid thrown off the program in an attempt to manage what is an already unmanageable debt. Without statehood, the island cannot hope for further relief from the federal government.

The nation has a largely impoverished population that is trying to recover from a natural disaster that destroyed many homes and livelihoods. They are also trying to learn how to cope with these new changes that will make finding affordable healthcare an even bigger challenge for the downtrodden residents. Nonprofits and corporations have attempted to alleviate some of this burden by providing free medical services and supplies. They have also raised funds to help those affected by the storm. While these efforts have made a huge difference in the lives of the residents, these were short-term measures that do little to address the coming financial issues the island will soon face.

As long as Puerto Rico is considered a territory and not a full state, with the rights that this entails, there is little that can be done for the people of the island outside of these small, helpful – but not nearly large enough – efforts put forth by private enterprises. The hurricane, coupled with the already looming financial crisis, has put the island in an unenviable and unwinnable spot that has many in government unsure how to proceed.

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