Understanding Puerto Rico’s Healthcare Collapse


 It’s no secret that Puerto Rico faces a crucial moment in its history. A crippling $72 billion debt has brought the Island to the worst fiscal and economic crisis on record. Having defaulted on major payments and facing a looming $780 million bill due July 1, the island awaits the U.S. Senate’s passage of a bipartisan debt relief bill. But an unsustainable debt burden is not the only challenge facing the Commonwealth today.

As the Senate debates the debt relief bill, 3.5 million U.S. citizens of Puerto Rico are staring in the face of a humanitarian catastrophe. With hospital closings and a doctor a day leaving the Island, our entire healthcare system is on the brink of collapse. Just last week, Puerto Rico’s only active air ambulance company suspended its services, blaming a large debt that the local government could not pay. Just this week, Puerto Rico’s only stroke center operating 24/7 closed its doors due a lack of funding and shortage of neurologists. And this dire situation will be compounded dramatically as the Island attempts to deal with the Zika crisis.

Though occasionally covered by the mainland media, the reasons fueling this healthcare emergency are still not adequately understood. While the Puerto Rican government must comply with all federal healthcare regulations and make all required payments, it is treated differently than any other jurisdiction in the United States. And by differently, we mean inequitably.

Sixty percent of the Island’s population – over 2 million patients – receives their care through Medicare, Medicare Advantage or Medicaid. But despite paying the same Social Security and Medicare taxes, reimbursement rates on the Island are almost half those of mainland states. Puerto Rico’s Medicaid program receives 70 percent lower reimbursement rate of any other state and is capped, the Medicare Advantage program is paid 60 percent of the average rate – while having the highest MA enrollment in the U.S. – and Medicare reimbursement rates are 40 percent lower.

In addition to discriminatory Medicaid rates, unlike the 50 states, the Island’s Medicaid program is funded by a block grant, which is due to expire next year. If the grant is not renewed by Congress, Puerto Rico will have to come up with $1.8 billion by 2018 or significantly curtail its Medicaid benefits, leaving millions without adequate healthcare. What is even more galling is that Puerto Rico is subject to the Affordable Care Act’s health insurance tax, but is excluded from deriving any benefit from the ACA’s health insurance exchange. The impact on the Island this year is expected to be approximately $65 million in lost coverage for vulnerable Puerto Ricans.

Though Puerto Ricans have been U.S. citizens for 99 years, examples of such health care disparities are all too common. It is no wonder then that more than 40 percent of the island’s debt is due to health care and the lack of funding from Medicaid in particular. This chronic underfunding has caused cutbacks in services, a major physician exodus, life-threatening delays in getting appointments and huge delays in payments to hospitals and other medical providers. Patients are suffering and the system is crumbling.

As U.S. citizens, Puerto Ricans deserve equitable funding and the same access to health care as those on the mainland. The federal government must restore equity to our rates, eliminate the Medicaid funding cap and provide Puerto Rico the services and benefits its citizens are already paying for. The 3.5 million American citizens of Puerto Rico cannot live with the consequences of this discriminatory treatment.

Dr. Johnny Rullán is Puerto Rico’s former Secretary of Health and Secretary of the Puerto Rico Healthcare Crisis Coalition.


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