MDMC Officials Appeal to Legislators

by Scott Welton, Standard Democrat
scottw@standard-democrat.com

With healthcare reform fast approaching, hospital officials are appealing to legislators to take a closer look at reimbursement formulas.

Jason Schrumpf, Missouri Delta Medical Center’s Senior Vice President, and Brian Menz, Chairman of Missouri Delta Medical Centers Board of Directors, discussed the hospital’s concerns with legislators in Washington, D.C., on Wednesday and Thursday as part of the Missouri Hospital Association’s federal advocacy team.

“We went in conjunction with other administrators and hospital representatives from throughout the state of Missouri,” Schrumpf said.

Hospitals receive Disproportionate Share Hospital Payments to offset the costs of providing care to uninsured and underinsured patients.

Based on an audit that isn’t even complete yet and the presumption that more people will have health insurance beginning in 2014 due to the Patient Protection and Affordable Care Act signed into law on March 23, MDMC had their DSH payment cut by $1.1 million on July 1 with less than a month’s notice.

Hospitals are expected to calculate their DSH payments for the state’s fiscal year 2011 by using figures from audits that will not be finished until halfway through that fiscal year, according to Schrumpf.

If the Centers for Medicare and Medicaid Services, the federal agency which administers Medicare, Medicaid and the Children’s Health Insurance Program, instead used the numbers reported to the agency in December, “this would allow CMS to develop its standards based on the actual audit findings,” Schrumpf suggested.

The DSH reimbursement formula also fails to account for patients who are treated but only have a small fraction of their bills covered by insurance. If the insurance pays a single penny “they’re considered to have coverage,” Schrumpf said.

CMS doesn’t take into account that the hospital often doesn’t receive patients’ co-insurance, deductible or other charges for services rendered after coverage limitations have been reached, he said.

“It is a matter of defining who is uninsured and making appropriate revisions to fairly credit hospitals for uncompensated care,” Schrumpf said. “CMS should revisit its definition of uninsured and make appropriate revisions.”

In addition to this and other problems the Disproportionate Share Hospital Payment formulas present for MDMC, “the healthcare reform legislation passed is providing rural hospitals with many challenges,” Schrumpf said. “As insurance coverage expands, it is essential that reimbursement will cover the cost to provide these services or access will be a problem.”

What is actually happening, however, is that CMS is attempting to reduce DSH payments now, years before the presumed expanded coverage even takes effect, he said.

In addition to discussing funding concerns with U.S. Rep. Jo Ann Emerson and her health legislative assistant, Sen. Kit Bond and his health legislative assistant and legislative assistants for Sen. McCaskill, Schrumpf presented a letter highlighting “issues that are impacting healthcare in Southeast Missouri and in particular Missouri Delta Medical Center,” Schrumpf said.

The cost wage index, timelines for implementing electronic medical records, Medicaid coverage for physical therapy and allowing MDMC to guarantee loan forgiveness through the National Health Services Corp to attract physicians are some of the other talking points brought to officials in Washington.