There is an excellent, albeit heartbreaking, article in this morning's Washington Post [1] that I want to share with you. It tells of the Muhlenberg Regional Medical Center in Plainfield, New Jersey, a 130-year-old facility that is likely closing its doors due to financial crisis. 
Like all hospitals in New Jersey, Muhlenberg is required by state law to treat anyone who comes through its doors, regardless of their ability to pay. In the past, the hospitals have been reimbursed by the state government for the cost of services to the uninsured and underinsured. But due to major cuts in the reimbursement program, many hospitals can not afford to pick up the tab for care, and are going bankrupt. Six hospitals in New Jersey have closed their doors in the past year and a half, and half of those remaining are operating in the red.
But the story of the hospital closings is not just one of budget shortfalls and excessive costs. Many of the hospitals that have closed are in low-income communities, and many serve predominantly minority and immigrant populations. Patients will now have to travel two or three times the distance to get to the nearest hospital-- a distance that can be significant factor in the treatment of critical conditions.
Though the article recounts a variety of explanations for Muhlenberg Medical Center's demise, it also makes the point that "almost everyone agrees that a key underlying problem is the lack of universal health insurance." The answer to the question of how to save bankrupt hospitals in New Jersey, and all around the country, is not ultimately in restoring state budgets and increasing payments to hospitals for charity care, but rather in a comprehensive fix to our broken health care system-- one that, like H.R. 676, provides universal care to all people, without private insurance and without means-testing.
Links:
[1] http://www.washingtonpost.com/wp-dyn/content/article/2008/07/06/AR2008070602334.html?hpid=topnews