PA Rural Hospitals to Get Boost From State

A new law seeks to stabilize the financial condition of Pennsylvania’s rural hospitals.

Harrisburg, PA capital buildingSenate Bill 314, passed by the legislature and signed by Governor Wolf, establishes a new Rural Health Redesign Center Authority and Pennsylvania Rural Health Redesign Center fund that will seek to support the delivery of health care by rural hospitals in the state by, as a legislative co-sponsorship memo explained,

  • creating an annual, prospective budget with regular, predictable payments;
  • improving the ability to develop and carry out expanded and innovative community health services; and
  • providing the capacity to pursue programs addressing key needs such as behavioral health and substance abuse and cooperative EMS.

The new approach will shift participating hospitals from fee-for-service to global payments.  Eligible hospitals will receive monthly global budget payments from payers based on historic revenue data that is adjusted for care delivery changes and inflation.

Learn more from the Becker’s Hospital Review article “Pennsylvania governor signs law providing regular, predictable payments to rural hospitals” and from the co-sponsorship memo that accompanied the bill’s introduction in Pennsylvania’s General Assembly.

Filed under: Uncategorized

Progress Continues Toward Launch of PA Health Insurance Exchange

Pennsylvania remains on target to launch its own health insurance exchange in time for the 2021 open enrollment season.

Pennsylvania State MapThe shift away from using the federal exchange and developing a state-based exchange was approved by the state legislature earlier this year.  That shift took a major step forward recently when the state hired a contractor to create the site’s platform.

State officials estimate that once the state’s site is up and running it will costs $25 million a year to operate; currently, Pennsylvania pays $95 million a year to participate in the federal exchange.  In addition, the state will be able to collect the three percent of premiums that insurers pay to appear on the federal site.  Those seeking insurance on the new state site should  benefit, too, with state officials estimating that purchasing reinsurance will enable consumers to save five to ten percent on premiums.

For an update on the status of the development of Pennsylvania’s health insurance exchange, see the Fierce Healthcare article “Pennsylvania takes another step toward launching state-based insurance exchange.”

Filed under: Uncategorized

High-Deductible Plans Driving Rise in Hospital Bad Debt

Hospital bad debt rose in 2018 after several years of decline, and according to Moody’s, high-deductible health insurance is one of the major drivers of that increase.

According to the bond rating agency, non-profit hospitals are seeing growing amounts of bad debt as they struggle, often unsuccessfully, to collect from patients whose high deductibles leave them on the hook for meaningful amounts of care.

Kaiser Health News reports that 28 percent of covered workers, nearly half of them working for companies with fewer than 200 employees, now have health plan deductibles of at least $2000.  That proportion of individuals with such high deductibles has nearly quadrupled in the last decade.

Bad debt can be an especially challenging problem for Pennsylvania safety-net hospitals because they care for so many low-income patients who, even when they have health insurance, often struggle to find the money to pay their share of the costs their plans do not cover.

Learn more about the bad debt challenge facing hospitals in the Healthcare Dive article “Nonprofit bad debt climbs again amid steeper deductibles, Moody’s says.”

Filed under: Pennsylvania safety-net hospitals

Medicaid DSH Cut Delayed

Cuts in Medicaid DSH payments to hospitals will be delayed for another month after Congress passed, and the president signed, a continuing resolution to fund the federal government through December 20.

A cut in federal Medicaid disproportionate share (Medicaid DSH) allotments to the states is mandated by the Affordable Care Act and has been delayed several times by Congress.  If implemented, Medicaid DSH allotments to the states would be slashed $4 billion in FY 2020 and then $8 billion a year through FY 2025.

Cuts in allotments to the states would result in reductions of Medicaid DSH payments to DSH-eligible hospitals.

Medicaid DSH payments are a vital tool for helping safety-net hospitals care for the low-income residents of their communities.  All Pennsylvania safety-net hospitals receive such payments.

The current cut is only temporary and expires when the continuing resolution expires after December 20.

Filed under: Affordable Care Act, DSH hospitals, Federal Medicaid issues

Administration Shares Regulatory Priorities for 2020

The Trump administration’s health care regulatory priorities for 2020 have been outlined by the Office of Management and Budget in a newly released “Statement of Regulatory Priorities for Fiscal Year 2020.”

The statement, an annual OMB document, organizes the priorities as follows:

  • Facilitating patient-centered markets
  • Fixing health care financing through protecting private insurance and Medicare
  • Fixing health care financing through reforming the individual market
  • Fixing health care financing through making the ACA and Medicaid fiscally sustainable
  • Bringing value to health care through price and quality transparency
  • Bringing value to health care through patient-centered health IT
  • Bringing value to health care through deregulation, especially for coordinated care
  • Bringing value to health care through tackling the high cost of prescription drugs
  • Bringing value to health care through accelerated drug and device approval and reimbursement
  1. Promoting health and protecting life
  • Addressing impactable health challenges: kidney health
  • Addressing impactable health challenges: combatting the opioid crisis
  • Protecting conscience and life at all stages
  • Reducing the disease and death associated with tobacco use
  1. Promoting independence
  • Returning TANF to promoting work, marriage and family
  • Supporting adoption
  • Empowering Americans to improve their nutrition
  • Promoting flexibility for states, grantees, and regulated entities

Learn more about the regulatory directions the administration intends to take for the rest of its 2020 fiscal year in the newly released “Statement of Regulatory Priorities for Fiscal Year 2020.”  Go here to see the complete list of regulations that the Department of Health and Human Services intends to pursue in FY 2020, including 55 by the Centers for Medicare & Medicaid Services (CMS).


Filed under: Affordable Care Act, Federal Medicaid issues, Medicare

Improper Medicaid, CHIP Payments on the Rise

The rate at which Medicaid and the Children’s Health Insurance Program made improper payments rose considerably in federal fiscal year 2019.

According to the Centers for Medicare & Medicaid Services, the Medicaid improper payment rate in FY 2019 was 14.9 percent, amounting to $57.36 billion in improper payments.  The improper payment rate that year for CHIP services was 15.83 percent, representing $2.74 billion in improper payments.  Both are significant increases over FY 2018, when the Medicaid improper payment rate was 9.7 percent, representing $36.25 billion, and the CHIP rate was 8.57 percent, for $1.39 billion.

CMS maintains that the improper Medicaid payment rate will decline in future years because it has introduced more rigorous enforcement of Affordable Care Act requirements to determine and periodically redetermine eligibility for Medicaid participants.  Because each state is reviewed for improper payments only every three years, the agency maintains, it will take time before the full impact of the more rigorous review of beneficiary eligibility will be seen in annual statistics

Learn more about improper Medicaid and CHIP payments in the CMS fact sheet “2019 Estimated Improper Payment Rates for Centers for Medicare & Medicaid Services (CMS) Programs.”


Filed under: Federal Medicaid issues

DHS Unveils Strategic Plan

Pennsylvania’s Department of Human Services has a new strategic plan for 2019 through 2022.

While DHS’s area of endeavor is broad and goes beyond health care, Medicaid is an important aspect of its work and that importance is reflected in the plan, which includes descriptions of DHS’s ambitions in the following areas:

  • Provide every child with a strong foundation for physical and behavioral well-being
  • Bend the health care cost curve
  • Drive innovative whole-person care
  • Holistically assess needs and connect to resources
  • Address the social determinants of health
  • Expand health care beyond the doctor’s office and into the places people live, work, and play
  • Coordinate physical health care, behavioral health care, and long-term services and supports
  • Promote health equity
  • Lead the health care system toward value-based purchasing coordinated across payers
  • Serve more people in the community
  • Enhance access to health care and services that help Pennsylvanians lead healthy, productive lives
  • Coordinate services seamlessly across programs and agencies
  • Expand services and supports for individuals with mental illness
  • Expand services and supports for individuals with substance use disorder

Learn more about what Pennsylvania has in mind for its Medicaid program in the coming years, and for the Pennsylvania safety-net hospitals that serve so many participants in that program, by reading DHS’s new strategic plan for 2019 through 2022.

Filed under: Pennsylvania Medicaid, Pennsylvania Medicaid policy, Pennsylvania Medical Assistance

PA Health Law Project Newsletter

The Pennsylvania Health Law Project has published its October 2019 newsletter.

Included in this month’s edition are articles about:

  • the state’s release of a request for applications for insurers to serve participants in Pennsylvania’s HealthChoices physical health care program
  • Pennsylvania’s new Medicaid preferred drug list
  • legislation to expand the state’s Medical Assistance for Workers Program
  • the expansion of the state’s Living Independence for the Elderly (LIFE) program to 14 new counties over the next 18 months.

Read about these subjects and more in the Pennsylvania Health Law Project’s October newsletter.

Filed under: HealthChoices, Pennsylvania Medicaid policy, Pennsylvania Medical Assistance

PHC4 Reports on Hospital Mortality, Admission Rates, and Performance

Mortality rates, admission rates, and other aspects of hospital performance are the subject of a new report by the Pennsylvania Health Care Cost Containment Commission.

The report presents information on hospital volume and outcomes for 17 different medical conditions and surgical procedures from October 2017 through September 2018.  It also compares hospital performance over the five-year period from 2013 through 2018 on an aggregate state-wide basis and for individual hospitals.

Overall, the report found decreases in hospital mortality for most of the 17 conditions, with respiratory failure, sepsis, colorectal procedures, and intestinal obstructions experiencing the biggest decreases (by percentage).  Hospital admissions for chest pain, chronic obstructive pulmonary disease, and pneumonia experienced the biggest declines while admissions for respiratory failure and sepsis experienced significant increases (in numbers).

For state-wide and hospital-specific data on hospital performance on 17 medical conditions and procedures, see the new PHC4 documents that together constitute its Hospital Performance Report 2018.

Filed under: Uncategorized

MACPAC Looks at Medicaid DSH

At a time when cuts in Medicaid disproportionate share hospital payments (Medicaid DSH) are still scheduled for the current fiscal year and some in Congress are calling for a new approach to allotting DSH funds among the states, the Medicaid and CHIP Payment and Access Commission has released its annual analysis of Medicaid DSH allotments to the states.

The report includes:

  • data about changes in the uninsured rate
  • demographic information about the uninsured
  • information about the cost of hospital uncompensated care
  • perspectives on hospital Medicaid shortfalls
  • a comparison of hospital uncompensated care costs when calculated using different methodologies
  • data about hospitals that provide “essential community services”
  • information about scheduled Medicaid DSH allotment reductions

All Pennsylvania safety-net hospitals receive Medicaid DSH payments and consider the program an essential tool for serving their communities.

MACPAC will issue a more complete report to Congress in March of 2020.

Learn more about how MACPAC views Medicaid DSH at a time when the program is scheduled to change – and when some want even more change – in the new MACPAC document “Required Analyses of Disproportionate Share Hospital (DSH) Allotments.”


Filed under: DSH hospitals, Federal Medicaid issues, Medicaid supplemental payments, Pennsylvania safety-net hospitals

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2012 Safety-Net Association of Pennsylvania