caring for the uninsured: safety net hospitals and health systems barbara eyman powell goldstein llp...
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Caring for the Uninsured: Caring for the Uninsured: Safety Net HospitalsSafety Net Hospitalsand Health Systemsand Health Systems
Barbara Eyman Barbara Eyman Powell Goldstein LLPPowell Goldstein LLP
Medicaid CongressMedicaid CongressJune 14, 2007June 14, 2007
© 2007 Powell Goldstein LLP. All rights reserved.2
Presentation OverviewPresentation Overview
1. Safety Net Hospitals & Health Systems – Basic Facts
2. Sources of Financing Care for the Uninsured
Current Threats
3. Innovative Models of Care for the Uninsured
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Safety Net Hospitals and Health Systems:
Basic Facts
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Key Roles of Key Roles of Safety Net Hospitals Safety Net Hospitals
& Health Systems& Health Systems
Care for the uninsured
Emergency response
Specialized services such as trauma,burn care, neonatal intensive care
Train many of the nation’s future health care professionals
Community-based primary care
Comprehensive, coordinated care
Diverse patient population
© 2007 Powell Goldstein LLP. All rights reserved.5
Source: NAPH Hospital Characteristics Survey, 2004
Discharges byPayer Source
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Outpatient Visits by Outpatient Visits by Payer SourcePayer Source
Source: NAPH Hospital Characteristics Survey, 2004
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NAPH Hospitals36%
Community Health Centers
64%
Note: This data from FY 2004 represents 914 community health centers that received HRSA Bureau of Primary Health Care grants and the 89 public hospitals and health systems that participated in the NAPH Hospital Characteristics Survey.
Source: NAPH Hospital Characteristics Survey, 2004. U.S. Department of Health and Human Services, Health Resources and Services Administration (HRSA), Uniform Data Set (UDS), 2004.
Outpatient Visits toSafety Net Providers
(Excludes ED)
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Black29%
Hispanic/Latino26%
Asian/Pacific Islander
3%
Other3%
White39%
Source: NAPH Hospital Characteristics Survey, 2004
Discharges by Race/Ethnicity at
NAPH Members
© 2007 Powell Goldstein LLP. All rights reserved.9
Disproportionate Disproportionate Share of Care to Share of Care to
the Uninsuredthe Uninsured
NAPH hospitals represent only 2 percent of the acute care hospitalsNAPH hospitals represent only 2 percent of the acute care hospitalsin the nation but provide 25% of the uncompensated care.in the nation but provide 25% of the uncompensated care.
25%2%
0%
20%
40%
60%
80%
100%
120%
NAPH Hospitals as % ofHospitals Nationally
NAPH Hospitals % ofUncompensated Care Costs
Nationally
HospitalsNationally
NAPH Hospitals
Source: NAPH Hospital Characteristics Survey, 2004
© 2007 Powell Goldstein LLP. All rights reserved.10
Net Revenues Net Revenues by Payer Sourceby Payer Source
Medicare20%
State/Local Subsidies
14%
Self-Pay/Other7%
Commercial24% Medicaid
35%
Source: NAPH Hospital Characteristics Survey, 2004
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Sources of Financing Care
for the Uninsured
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Sources of Financing Sources of Financing for Unreimbursed Carefor Unreimbursed Care
Other, 26%
State/Local Subsidies, 35%
Supplemental Medicaid Payments,
9%
Medicare DSH, 5%
Medicare IME, 4%
Commercial, 2%
Medicaid DSH, 19%
Source: NAPH Hospital Characteristics Survey, 2004
© 2007 Powell Goldstein LLP. All rights reserved.13
Disproportionate ShareDisproportionate ShareHospital PaymentsHospital Payments
Only Explicit Medicaid Payment for the Uninsured
Total $17 Billion ($9.6B Federal) inFFY 2005
Hospital-Specific DSH Limits No More than Unreimbursed Costs for
Medicaid and Uninsured Patients
State DSH Allotments Set in Statute Based on Historical Spending
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State DSH AllotmentsState DSH Allotments(FFY 06)(FFY 06)
AL
AK AZ
AR C
AC
OC
T DE
DC FL GA
HI ID IL IN IA KS
KY LA ME
MD MA
MI
MN
MS MO
MT
NE
NV NH NJ
NM N
YN
CN
D OH
OK
OR PA RI
SC SD TNTX UT
VT VA WA
WV W
I
WY$0
$250
$500
$750
$1,000
$1,250
$1,500
$1,750
Fede
ral A
llotm
ent (
mill
ions
)
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Upper Payment Upper Payment Limits (UPLs)Limits (UPLs)
UPL is Limit on Non-DSH Medicaid Payments to Institutional Providers
Supplemental Payments Outside of DSH May Not Exceed the UPL
“UPL Payments” Are for Medicaid Patients Only
Limit = Rates Based on Medicare Payment Principles
Calculated on an Aggregate Basis
© 2007 Powell Goldstein LLP. All rights reserved.16
$150
$75
$100
$75
$0
$25
$50
$75
$100
$125
$150
$175
$200
Provider 1 Provider 2 Provider 3 Provider 4
Aggregate UPLAggregate UPL
Medicare
UPL = $400Total Pmts = $400
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Medicaid Payments Medicaid Payments for Low Income andfor Low Income andUninsured PatientsUninsured Patients
UPL
DSH
Medicaid Uninsured
Cost of Services
BasePmt
DSH
Medicare Rate
Aggregate UPL
UPL
UPL or DSH
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Importance of Importance of Supplemental Supplemental
Medicaid PaymentsMedicaid Payments
Source: AHA Annual Survey 2004; NAPH Hospital Characteristics Survey, 2004
All Hospitals Nationally NAPH Members NAPH Members withoutDSH or UPL
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Funding Supplemental Funding Supplemental Medicaid PaymentsMedicaid Payments
State General Revenues
Intergovernmental Transfers (IGTs)
Certifications of Public Expenditures (CPEs)
Broad-Based, Uniform Provider Taxes
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IGT MechanicsIGT Mechanics
County
State
County ProviderFederal Government
$200 Payment
$100 IGT$200 Claim
$100 FFP
•County provider contributes $100•CMS provides $100 FFP•County provider is reimbursed $200•No state general revenues
•County provider contributes $100•CMS provides $100 FFP•County provider is reimbursed $200•No state general revenues
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CMS IGTCMS IGTCost Limit RuleCost Limit Rule
Cost Limit for Governmental Providers
Significant Reduction in UPL
Restrictive Definition of Governmental Providers
Limits Sources of Non-Federal Share Funding
Threatens Viability of Supplemental Payments
© 2007 Powell Goldstein LLP. All rights reserved.22
UPL
DSH
Medicaid Uninsured
Cost of Services
BasePmt
DSH
Medicare Rate
Aggregate UPL
UPL
UPL or DSH
Medicaid Payments Medicaid Payments for Low Income andfor Low Income andUninsured PatientsUninsured Patients
© 2007 Powell Goldstein LLP. All rights reserved.23
UPL
DSH
Medicaid Uninsured
Cost of Services
BasePmt
DSH
Medicare Rate
Aggregate UPLCuts
UPL or DSH
Medicaid Payments Medicaid Payments for Low Income andfor Low Income andUninsured PatientsUninsured Patients
© 2007 Powell Goldstein LLP. All rights reserved.24
UPL
DSH
Medicaid Uninsured
Cost of Serviceswithout GME
BasePmt
DSH
Medicare Rate
Aggregate UPLCuts
CutsCuts
Medicaid Payments Medicaid Payments for Low Income andfor Low Income andUninsured PatientsUninsured Patients
© 2007 Powell Goldstein LLP. All rights reserved.25
Financial ImpactFinancial Impact
The regulation will have a significant financial impact on The regulation will have a significant financial impact on
states, safety net providers and their communities.states, safety net providers and their communities.
Examples of State Impacts
State
Annual Impact (in millions)
Florida $930Georgia $253New York $350Texas $294
© 2007 Powell Goldstein LLP. All rights reserved.26
Medicaid Uninsured Low Income Pool
Medicare Rate (UPL)
Cost of Services
DSH
DSH
LIP
UPL
Budget NeutralityUPL
UPL
Waiver-BasedWaiver-BasedImplementationImplementation
of Cost Limitof Cost Limit
LIP
© 2007 Powell Goldstein LLP. All rights reserved.27
Current StatusCurrent Status
CMS Issues Final Rule 5/25 – AM
President Signs War Funding Bill with One-Year Moratorium on Rulemaking 5/25 – PM
Halts Implementation of Final Cost Limit/IGT Rule
Halts Finalization of GME Rule
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Innovative Models of Care for the
Uninsured
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Safety Net Provider-Safety Net Provider-Based Health PlansBased Health Plans
Developed as a Means to Participate in Medicaid Managed Care
Infrastructure Used for “Lookalike” Plan for the Uninsured
Plans Participate in Coverage Expansion Initiatives
© 2007 Powell Goldstein LLP. All rights reserved.30
Virginia Coordinated Virginia Coordinated Care (VCC)Care (VCC)
Developed by VCU Health System, Richmond, VA
Health Plan for the Uninsured
Comprehensive Benefits Package
Provides Medical Homes
Network of VCU andCommunity Providers
Sliding Scale Co-pays
© 2007 Powell Goldstein LLP. All rights reserved.31
Virginia Coordinated Virginia Coordinated Care (VCC)Care (VCC)
VCC Goals:
Manage care forthe uninsured
Reduce cost of care
Improve quality
Reduce inappropriateED utilization
Establish community-specialist relationships
© 2007 Powell Goldstein LLP. All rights reserved.32
Chronic Care Chronic Care ManagementManagement
Chronic Disease a Major Challenge for Safety Net Hospitals
Low Income Populations at High Risk
High Rate of Co-morbidities
Prevalent Psycho-Social Issues
Few Resources to Provide Care
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Denver HealthDenver Health
Initiatives for:
Asthma
Diabetes
HIV
Depression
Cancer Prevention
Prenatal Care
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Denver HealthDenver Health
Combines:
Primary Care Teams
Frequent User Program
Advanced Access
Patient Self-Management
Clinical Information Systems (e.g. Diabetes Registry)
© 2007 Powell Goldstein LLP. All rights reserved.35
Language AccessLanguage Access
Over 100 Languages Spoken at NAPH Member Hospitals
20-30 Languages at the Typical Safety Net Hospital
Longstanding Efforts to Improve Language Access Employed Interpreters
Volunteers
Telephone Interpretation
© 2007 Powell Goldstein LLP. All rights reserved.36
Alameda CountyAlameda CountyMedical CenterMedical Center
Video-Conferenced InterpretationReduced Wait Times
From 30-45 Minutes to 5 Minutes
Improved Communication Visual Cues Are Key
Wider Range of Languages Available
Increase Provider Efficiency Visits Decreased from 32 to 18 Minutes
© 2007 Powell Goldstein LLP. All rights reserved.37
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