fy 2005 indigent care trust fund
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FY 2005 Indigent Care Trust Fund. Disproportionate Share Hospital Program Presented to House Appropriations Health Subcommittee June 23, 2005. Overview. What is DSH? Administration of DSH Hospital Eligibility Hospital Specific DSH Limits Allocation Methodology FY 2005. - PowerPoint PPT PresentationTRANSCRIPT
FY 2005 FY 2005 Indigent Care Trust FundIndigent Care Trust Fund
Disproportionate Share Hospital Program
Presented to
House Appropriations
Health Subcommittee
June 23, 2005
June 23, 2005Presented to
House Appropriations Health Subcommittee
OverviewOverview
What is DSH?Administration of DSHHospital Eligibility Hospital Specific DSH LimitsAllocation MethodologyFY 2005
June 23, 2005Presented to
House Appropriations Health Subcommittee
What is DSH?What is DSH?
DSH = Disproportionate HospitalFederal Funds available annually to help
compensate hospitals with a disproportionate share of uncompensated care from Medicaid and uninsured patients
In Georgia, federal funds matched by intergovernmental transfers made by public hospitals – no state appropriations involved
June 23, 2005Presented to
House Appropriations Health Subcommittee
Administration of DSHAdministration of DSH
Information NeededAmount of Federal DSH funds availableList of Hospitals Eligible for DSHHospital-Specific DSH LimitsRural or Urban Designation for HospitalsPublic or private status of hospital
June 23, 2005Presented to
House Appropriations Health Subcommittee
Administration of DSH (cont)Administration of DSH (cont)
Indigent Care Trust Fund Advisory Committee Membership comprised of both rural and urban
hospitals as well as public and private hospitals Makes recommendations to DCH regarding the
administration of the DSH program Meets at least annually or more often as needed Membership appointed by the Commissioner
June 23, 2005Presented to
House Appropriations Health Subcommittee
Hospital Eligibility Hospital Eligibility for DSH Participationfor DSH Participation
Federal Criteria(MUST MEET BOTH) Ability to provide obstetric services to Medicaid
members Medicaid inpatient utilization rate of at least 1
percent
June 23, 2005Presented to
House Appropriations Health Subcommittee
Hospital Eligibility Hospital Eligibility for DSH Participationfor DSH Participation
State Criteria(MUST MEET AT LEAST ONE) Medicaid inpatient hospital utilization exceeds
certain level Low-income inpatient utilization rate exceeds 25
percent of revenue Total Medicaid charges exceed 15 percent of
revenue Non-state hospital with the largest number of
Medicaid admissions in its MSA.
June 23, 2005Presented to
House Appropriations Health Subcommittee
Hospital Eligibility Hospital Eligibility for DSH Participationfor DSH Participation
State Criteria (continued)(MUST MEET AT LEAST ONE) Children’s hospital Designated regional perinatal center Medicare rural referral center/Medicare DSH
provider Board of Regents teaching hospital Small, rural, public hospital with Medicaid
inpatient utilization of at least 1 percent
June 23, 2005Presented to
House Appropriations Health Subcommittee
Hospital-Specific DSH LimitsHospital-Specific DSH LimitsDSH Limit equal to Medicaid and
Uninsured uncompensated care– DCH uses historical cost data compared to cash
collections to determine what hospital care was not paid for by any other payers
– Data is reported on the annual Hospital Financial Survey
– Data inflated to approximate today’s uncompensated care
June 23, 2005Presented to
House Appropriations Health Subcommittee
Hospital-Specific DSH LimitsHospital-Specific DSH Limits
Hospital Financial Surveys subject to state audit:
DCH contracts with Georgia Department of Audits for audits
All surveys subject to desk reviewsOn-site reviews for
– Hospitals with the largest DSH limits– Hospitals with unusual changes in data
June 23, 2005Presented to
House Appropriations Health Subcommittee
DSH Allocation MethodologyDSH Allocation Methodology
Policies No hospital receives more than their hospital-
specific DSH limit Intergovernmental transfers from public facilities
are used to match federal DSH funds and make DSH payments– For large private or urban private hospitals, the
allocation is capped at 50% of the hospital specific DSH limit
June 23, 2005Presented to
House Appropriations Health Subcommittee
DSH Allocation MethodologyDSH Allocation Methodology
Policies The Department calculates an initial and
secondary DSH allocation based on available funds. – In the initial allocation, small, rural hospitals
receive 100% of their hospital-specific DSH limits.– The secondary allocation distributes the rest of the
available DSH funds to all other, eligible hospitals.
June 23, 2005Presented to
House Appropriations Health Subcommittee
FY 2005FY 2005
Fund Availability and Hospital EligibilityTimeline
– Changes in Data Used for Hospital Specific DSH Limits
– Interim Payments – Expanded On-Site Reviews of Data
Application of Stop Loss and Stop GainNext Steps
June 23, 2005Presented to
House Appropriations Health Subcommittee
FY2005 DSH SummaryFY2005 DSH Summary
FY 2004 FY 2005Available DSH Funding $424,724,498 $419,237,251
Number of Eligible Hospitals*
96 107
Number of Hospitals Newly Eligible in FY 2005
13
Number of Hospitals Ineligible in FY 2005 that participated in FY 2004
2
* Met criteria to participate; does not necessarily guarantee their DSH limit was greater than zero
June 23, 2005Presented to
House Appropriations Health Subcommittee
FY 2005 TimelineFY 2005 TimelineAugust 2004 – Annual Indigent Care Trust Fund
Committee MeetingNovember 2004 - Department releases Individual
DSH Limits and Allocation December 2004 – Hospitals express concerns
about impact of data used in allocation– Data sources– Integrity of self-reporting and the quality of the
review process
June 23, 2005Presented to
House Appropriations Health Subcommittee
Data for Hospital-Specific Data for Hospital-Specific DSH LimitsDSH Limits
As compared to prior years, FY 2005 DSH Limit calculations a little different:
• Based on 2003 data (CMS required) • CY 2003 ICTF Advisory Committee
Recommendations applied
June 23, 2005Presented to
House Appropriations Health Subcommittee
Hospital-Specific DSH LimitsHospital-Specific DSH LimitsMedicaid Loss CalculationMedicaid Loss Calculation
FY 2004 Medicaid Claims-
Based Data Data from Cost
Reports available in 2002
Estimated Accrued Payments
FY 2005 Hospital reported
data Data from 2003
Hospital Financial Survey
Cash Payments
June 23, 2005Presented to
House Appropriations Health Subcommittee
Hospital-Specific DSH LimitsHospital-Specific DSH LimitsUninsured Loss CalculationUninsured Loss Calculation
FY 2004 Hospital reported data Data from 2001
Hospital Financial Survey
Estimated Accrued Payments
FY 2005 Hospital reported data Data from 2003
Hospital Financial Survey
Cash Payments
June 23, 2005Presented to
House Appropriations Health Subcommittee
FY 2005 Timeline (cont.)FY 2005 Timeline (cont.)• January 2005 – DCH Agrees to Further
Review Data; Makes Interim Payments to Support Cash Flow for Hospitals • Based on 75% of preliminary FY 2005
allocation• 15% Stop Loss and Stop Gain applied based on
FY 2004 allocations• No more than 90% of FY 2005 allocations were
made for hospitals subject to Stop Loss provision
June 23, 2005Presented to
House Appropriations Health Subcommittee
FY 2005 Timeline (cont.)FY 2005 Timeline (cont.)
February 2005 – ICTF Advisory Committee meets to advise DCH of policy areas that need clarification for on-site reviews
EXAMPLES:– Consideration of pharmacy and physician
services– Advanced Payment Impact on Cash Collections
June 23, 2005Presented to
House Appropriations Health Subcommittee
Expanded On-Site Reviews Expanded On-Site Reviews
February – May 2005 – Additional on-site reviews of data conducted by GDOAA
• Expanded on-site reviews for:• Hospitals with more than 25% change in their FY 2005
DSH allocations when compared to FY 2004• Safety Net Hospitals• Newly Eligible for DSH in FY 2005
• More than 85 hospitals subject to on-site reviews.
June 23, 2005Presented to
House Appropriations Health Subcommittee
Expanded On-Site ReviewsExpanded On-Site Reviews
Data problems identified– Lacked detailed, patient-level data – Data not delineated between services covered by DSH
vs. other programs. Time limitations prevented GDOAA from
accepting some re-created data reports supporting the HFS
DCH used data proxies to validate the reasonableness of self reported data when GDOAA could not validate during on-site reviews
June 23, 2005Presented to
House Appropriations Health Subcommittee
Outcome of Extended Outcome of Extended On-Site ReviewsOn-Site Reviews
Before AfterAggregate DSH Limits
FY 2004 $751,566,897
FY 2005 $866,775,780 $772,074,927
Number of Hospitals with DSH Limits (of 107 eligible)
102 98
Number of Hospitals With Increases in DSH Limits
36
Number of Hospitals With Reductions in DSH Limits
66
Number with No Change 5
June 23, 2005Presented to
House Appropriations Health Subcommittee
June DSH AllocationsJune DSH Allocations-Initial--Initial-
Based on Extended Reviews FY 2005
Number of Hospitals with Increases in Payments vs. FY 2004
58
Number of Hospitals with Decreases in Payments vs. FY 2004
49
Number of Hospitals with DSH Limit Equal to Zero
9
Average Increase 72%
Average Decrease 51%
June 23, 2005Presented to
House Appropriations Health Subcommittee
Why Such Swings in Why Such Swings in Payments?Payments?
• Update to newer data reflects growth in uncompensated care
• Implementation of ICTF Advisory Committee recommendations for data sources
• Smaller pool of funds to distribute• More hospitals participating• Change in hospital business practices
June 23, 2005Presented to
House Appropriations Health Subcommittee
Final AllocationsFinal Allocations• Final Allocation includes a Stop Loss and
Stop Gain and a protection for “negative” balances• 7% Stop Loss applied to FY 2004 hospital-
specific DSH limits• 14% Stop Gain applied to FY 2004 hospital-
specific DSH limits• Eight facilities held harmless where their interim
payments exceeded their final DSH allocation
June 23, 2005Presented to
House Appropriations Health Subcommittee
Impact of Stop Loss/Stop GainImpact of Stop Loss/Stop GainFY 2005 No SLSG With SLSG
Aggregate DSH Limits $772,074,927 $796,066,992
Number of Hospitals Subject to Stop Gain 38
Number of Hospitals Subject to Stop Loss 46
Number of Hospitals With No Impact 10
Number of Hospitals Where No SLSG Could Be Applied Due to New Eligibility
13
June 23, 2005Presented to
House Appropriations Health Subcommittee
Final DSH AllocationsFinal DSH AllocationsFY 2005 No SLSG With SLSG
Number of Hospitals with Increases in Payments vs. FY 2004
58 58
Number of Hospitals with Decreases in Payments vs. FY 2004
49 49
Average Increase 72% 9%
Average Decrease 51% 10%
June 23, 2005Presented to
House Appropriations Health Subcommittee
Next StepsNext Steps
Hospitals Provide Notice of Intent to Transfer Intergovernmental Funds by Friday, June 24
If all transfers received on June 27, payments made by June 28
If all transfers not received, remaining FY 2005 funding rolled forward to distribute in FY 2006 – NO PAYMENTS MADE IN JUNE
For FY 2006, seek hospital consensus, through an expanded ICTF Advisory Committee, on data collection and DSH fund allocation methodologies