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Supreme Court Paves Way for Public Charge Regulation

The revised public charge regulation that will make it more difficult for some immigrants to come to the U.S. will be implemented after the Supreme Court lifted preliminary injunctions issued by lower courts that delayed the regulation’s implementation.

Under revisions of the public charge regulation introduced last year, individuals seeking entry into the U.S. and green cards who do not appear to be financially independent or have employment commitments can be denied entry if they will be dependent on means-tested public aid programs such as Medicaid or food stamps or even if they, or members of their family, appear likely to become dependent on such aid in the near future.

A number of judges throughout the country blocked the administration’s implementation of revisions of the public charge rule.  The Supreme Court’s action only lifts those injunction; it does not address the constitutionality of the regulation, leaving that matter to continue to be addressed by lower courts for now.

The challenge posed to health care providers by the updated public charge regulation is as much a matter of perception as reality:  individuals already legally in the U.S. who are not subject to the regulation have withdrawn from Medicaid out of fear of deportation while others who also are in the country legally and qualify for Medicaid are choosing not to apply for benefits for the same reason.  This, in turn, may leave some providers with more uncompensated care instead of Medicaid reimbursement for the care they provide to some of their patients.

The National Alliance of Safety-Net Hospitals has conveyed its opposition to the public charge regulation to both Congress and the administration.  In a message to Congress, NASH wrote that “The new public charge regulation threatens the health of families and communities and threatens the ability of private safety-net hospitals to serve those families and those communities.”  In response to the proposed changes in the regulation, NASH wrote in a formal comment letter on behalf of private safety-net hospitals that it

…believes the proposed regulation could have a chilling effect on the willingness of many legal citizens and legal non-citizens to seek out government health care programs for which they legally qualify. This could lead to millions of low-income legal citizens and legal non-citizens choosing not to seek the care to which they are entitled by law and ignoring serious illnesses and injuries until they become a crisis. When such individuals have no choice but to turn to hospital emergency departments in search of care – something hospital emergency departments are required by law to provide regardless of a patient’s ability to pay – this could overwhelm those facilities and would do so to the detriment of other patients while also producing a surge of uncompensated care, especially for private safety-net hospitals. That, in turn, could jeopardize the jobs of thousands who work in those hospitals and the economies of the communities in which those hospitals are located. It could also jeopardize access to care for residents of these same communities – including ordinary people who receive their health care coverage from private insurers and Medicare.

See NASH’s entire comment letter here.

Learn more about the Supreme Court’s decision and how it affects implementation of the public charge regulation in the New York Times article “Supreme Court Allows Trump’s Wealth Test for Green Cards.”

 

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 private 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.”

 

High-Deductible Plans Losing Luster Amid Low Unemployment

The competition for employees is leading more businesses to offer more generous health insurance plans in addition to high-deductible plans.

As health insurance premiums rose in recent years, more and more companies were offering their employees more high-deductible insurance options to help keep down the cost of premiums.  Now, however, with some workers clamoring for more conventional plans and businesses finding themselves in competition for workers at a time of low unemployment, more businesses are offering those conventional plans to their workers.

2020, in fact, will mark the third consecutive year during which the percentage of companies offering only high-deductible health insurance plans will fall.

Serving patients with high-deductible health insurance can pose a special challenge for private safety-net hospitals.  Often, patients in the low-income communities these hospitals serve cannot afford to pay their deductibles, leaving such hospitals to absorb the cost of this uncompensated care.

Learn more about how businesses are adjusting their health insurance offerings in response to employee demand and competitive concerns in the Kaiser Health News article “Employers are Scaling Back Their Dependence on High-Deductible Health Plans.”

New Public Charge Rule Could Affect Immigrants, Providers

Legal immigrants may become reluctant to seek government-sponsored health care and providers may find themselves delivering more uncompensated care in the wake of the adoption of a new federal “public charge” regulation that seeks to define more narrowly the kinds of individuals who should be granted entry to the U.S. in the future.

The new Department of Homeland Security regulation, while focused on applicants for entry into the U.S., could have the unintended effect of discouraging legal immigrants from enrolling in Medicaid, CHIP, and other government programs and even lead them to disenroll from such programs out of a mistaken concern that participating in such programs could jeopardize their status as legal immigrants.  The Kaiser Family Foundation, in fact, estimates that two to three million people will leave Medicaid and CHIP because of the new regulation.

More than a quarter of a million interested parties responded to the proposed regulation, which was published last October, and since its release last week a wide variety of groups, ranging from the American Hospital Association and America’s Essential Hospitals to the American Council of Pediatrics, have noted the new regulation’s potential impact with alarm.  Hospitals, in particular, are concerned that if people disenroll from Medicaid and CHIP, they will end up providing more uncompensated care to patients who previously had health insurance through those two public programs.

This could be especially challenging for private safety-net hospitals because many are located in communities with large numbers of low-income legal immigrants.

Learn more about the new public charge regulation and health care providers’ reaction to it in the Fierce Healthcare article “Healthcare industry groups warn final ‘public charge’ rule could impact immigrant health, drive up costs.”

New Poverty Level Standards to Jeopardize Medicaid Eligibility?

The Trump administration is considering changing how the federal government measures inflation for the purpose of calculating the federal poverty level.

Such a change, if implemented, could potentially reduce inflation-related increases in the federal poverty level, which in turn could limit the ability of some individuals and families to qualify, or continue to qualify, for a variety of public safety-net services – including, potentially, Medicaid.

Among the possible alternatives to the current methodology for calculating inflation is the Chained Consumer Price Index for All Urban Consumers.  The Obama administration also explored substituting this index for the current inflation factor.

Any change that makes it more difficult for people to qualify for Medicaid could be particularly damaging to private safety-net hospitals, which are generally located in communities with especially large numbers of low-income residents.  If patients lose their Medicaid eligibility because the criteria for participating in the program change, that could leave such hospitals serving even more uninsured patients and providing even more uncompensated care than they already do.

The federal Office of Management and Budget has issued a request for comment about various inflation factor calculation alternatives.  Go here to see OMB notice Request for Comment on the Consumer Inflation Measures Produced by Federal Statistical Agencies.  Comments are due in late June.  Learn more from the New York Times article  “Trump Administration Seeks to Redefine Formula for Calculating Poverty.”

NASH Registers Concerns Over Uncompensated Care Audits

The process the federal government is employing to audit the uncompensated care costs that hospitals report to Medicare is plagued with problems, the National Alliance of Safety-Net Hospitals has written in a letter to the Centers for Medicare & Medicaid Services.

Those problems could result in reduced Medicare disproportionate share hospital payments (Medicare DSH) to private safety-net hospitals in the future, NASH warned in the letter.

According to NASH, problems with the audits of hospitals’ Medicare cost report S-10 worksheets, where they report their uncompensated care, include inconsistencies in the methods auditors are using and the data they demand and unreasonable deadlines for submitting requested supplemental data.

To address these problems, NASH asked CMS to standardize the auditing process and to convey decisions about auditing standards, methodologies, and time frames to hospitals.

In light of these problems, NASH also asked CMS not to use audited data to calculate Medicare DSH uncompensated care payments for FY 2020.

The S-10 audits are so important to private safety-net hospitals because the uncompensated care reported on the S-10 is used in the calculation of participating hospitals’ Medicare DSH uncompensated care payments.  When auditors reduce eligible hospitals’ uncompensated care data, that will result in future reductions of the Medicare DSH payments hospitals receive.  Those Medicare DSH payments play a vital role in helping to underwrite the cost of the care private safety-net hospitals provide to uninsured patients, so any undeserved reduction in those payments could hurt those hospitals and result in reduced access to care in the communities they serve.

Learn more by reading NASH’s letter to CMS about current challenges with uncompensated care audits.

Helping Safety-Net Hospitals Help Their Patients

A new report published on the Health Affairs Blog describes the continuing challenges safety-net hospitals face and offers suggestions for helping them meet those challenges.

The challenges, according to the report, are the virtual elimination of the Affordable Care Act’s individual health insurance mandate; the continued decline in the amount of Medicare disproportionate share hospital money (Medicare DSH) provided to safety-net hospitals; and hospital closures that shift more of the burden for caring for uninsured patients onto a smaller pool of safety-net hospitals.  The result is under-served patients and new financial risks for the hospitals that remain after some safety-net hospitals close because of the large amounts of uncompensated care those hospitals continue to provide.

To address these challenges, the report offers three potential solutions:

  • Congress should revisit the Medicare DSH cuts.
  • States should target their DSH money to the hospitals providing the most uncompensated care.
  • Non-profit non-safety-net hospitals that stabilize uninsured emergency patients and then direct them to safety-net hospitals should be required to play a longer-term role in the care of such patients as part of their required community benefit or risk losing their tax-exempt status.

Learn more about the challenges safety-net hospitals continue to face and some of the possible solutions to those problems by going here, to the Health Affairs Blog, to see the report “Safety-Net Health Systems at Risk:  Who Bears The Burden Of Uncompensated Care?”

House Committee Looks at 340B

Are hospitals using the savings generated by their participation in the section 340B prescription drug discount program to help their low-income and uninsured patients?

That’s what the House Energy and Commerce Committee’s Health Subcommittee is asking.

Earlier this year the committee requested such information from the Health Services and Resources Administration, which runs the 340B program, and now it’s asking hospitals as well.

Specifically, the subcommittee sent five-page letters to 19 providers that participate in the 340B program asking them about:

  • the quantity of 340B-purchased drugs they dispense to Medicare beneficiaries, Medicaid beneficiaries, and those with private insurance
  • the quantity of 340B-purchased drugs they dispense to uninsured patients
  • their savings from the 340B program and how they calculate those savings
  • how much charity care they provide
  • how they use 340B savings to serve vulnerable populations

The letters address many other 340B-related issues as well.

Most private safety-net hospitals participate in the 340B program and view it as a critical tool in their ability to meet the needs of their many low-income patients.

Learn more about the Health Subcommittee’s letter by reading this press release describing this initiative and go here to view the letters the subcommittee sent to selected 340B providers.

Medicare’s Costs Can Be High for Low-Income Beneficiaries

Despite enjoying Medicare coverage, low-income seniors can still spend a significant portion of their limited income on costs Medicare does not cover.

According to a new study published by the Commonwealth Fund, more than 25 percent of Medicare beneficiaries spend at least 20 percent of their income on health care – on things like premiums, cost-sharing, prescriptions, and dental and vision care, long-term care, and other services not covered by the federal program.  These costs pose a problem for many because nearly half of all Medicare participants have incomes below the federal poverty level, which is slightly less than $24,000 a year for a single person.  More than five million Medicare beneficiaries have no supplemental coverage, such as a Medigap plan or a Part D prescription drug plan, thereby increasing their out-of-pocket health care costs.

Such patients can be especially challenging for the nation’s private safety-net hospitals because often, they cannot afford their Medicare co-pays and deductibles.  In many cases, private safety-net hospitals end up absorbing these costs as uncompensated care – and because they serve far more low-income seniors than the typical American hospital, they experience this problem in far greater numbers and to a much greater degree and provide much more uncompensated care as a result.

Learn more about the out-of-pocket costs for which Medicare beneficiaries are responsible and how it affects them financially, and especially how it affects low-income Medicare beneficiaries financially, in the report “Medicare Beneficiaries’ High Out-of-Pocket Costs:  Cost Burdens by Income and Health Status,” which can be found here, on the Commonwealth Fund’s web site.

 

Hospital Uncompensated Care Down

As was surely expected, reforms introduced through implementation of the Affordable Care Act have driven down uncompensated care costs for many hospitals.

How much?

A new study published by the Commonwealth Fund offers the following findings:

  • uncompensated care declines in expansion states are substantial relative to profit margins;
  • for every dollar of uncompensated care costs hospitals in expansion states had in 2013, the Affordable Care Act erased 41 cents by 2015; and
  • Medicaid expansion reduced uncompensated care burdens for safety-net hospitals that are not made whole by Medicaid disproportionate share payments (Medicaid DSH).

Learn more, including how the decline in uncompensated care costs affected different kinds of hospitals in different kinds of states, in the report “The Impact of the ACA’s Medicaid Expansion on Hospitals’ Uncompensated Care Burden and the Potential Effects of Repeal,” which can be found here, on the Commonwealth Fund’s web site.