Wednesday, June 01, 2011

Texas May Divert DSH/UPL Funds

Senate Bill 23 has the state seeking a Medicaid waiver.  It's clear the intent is to offer a lesser benefit to citizens, while leveraging more federal money.  SB23 dumps state sponsored kids coverage on the CHIP program, which receives federal funds.

The bill sets up the Health Opportunity Pool Trust Fund.  The executive commissioner may use Medicaid disproportionate share and/or Upper Payment Limit money in the waiver. 

Safety net hospitals receive DSH & UPL payments to make up for Medicaid being such a poor payer.  These funds could be in jeopardy,  Shannon Medical Center received $15.5 million in DSH/UPL funding in 2010, according to Fitch Ratings.  What happens is if a portion, say half, gets diverted?

The state says it wants to reduce the number of people without health coverage and maintain and enhance the community public health infrastructure provided by hospitals.  These words ring hollow for anyone watching Legislators ignore the plight of the uninsured for over a decade while hospitals cost shift to make up for Medicaid's woeful reimbursement. Other payors ensure hospitals survive.  Many would close if Medicaid was their only source of business.

Texas safety net hospitals have to survive until 2014, when the only real help from PPACA arrives.  They may negotiate SB 23 minefields in the interim, thanks to the legislature living within its meanness.

Update 6-9-11:  The special session is entertaining SB 7.  It is yet to take up SB 23.

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