MHA Press Room

Comparison of the Governor's Medicaid plan

Last week, the Division of Medicaid filed new State Plan Amendments which lower inpatient hospital payments by 96.2% and offset the $369 million loss from claims by a corresponding increase in the upper payment limit (UPL). But reducing a hospital’s individual claims payments by 96.2% does not guarantee that the individual hospital’s UPL will increase correspondingly.

In the spreadsheet attached below, we have compared the Governor’s latest plan against the House leadership plan supported by MHA during the last week of the Special Session. Note that Medicaid increased the available UPL (not including the “shifted” amount) by $60 million, over and above the UPL amount they had helped MHA formulate during the regular legislative session. We don’t know if Mississippi hospitals actually qualify for that increase, but in order to make a valid comparison, we enhanced our model by the same amount.

Also, in the Medicaid model, they did not include the bed taxes that were included in the House leadership’s version of the proposed Medicaid funding bill, so we revised their net amount by the amount of the bed tax paid by each individual hospital. The House bill also included $45 million in tobacco taxes.

As you can see, under the House bill, 87 hospitals fare better than they will under the latest Medicaid plan.

Download gov_compare_to_enhanced_mha_model_with_45m_tobacco_tax_rev.xls

Singletary rules that Barbour's gross revenue tax is unconstitutional

Judge Singletary has made a ruling in the Mississippi hospitals' challenge of Gov. Barbour's authority to unilaterally levy a tax against hospitals. Attached is a copy of the opinion issued by Judge Singletary on July 10.

The Court found that Section 43-13-117(18)(b) was intended to fund only the non-federal share of the UPL program and not to be used as a general Medicaid funding mechanism. He found that the Division of Medicaid's interpretation is unconstitutional and is in violation of the separation of powers doctrine.

The defendants have 30 days to appeal.

Download gw2B.pdf

MHA Fact Sheet: Profitability of Mississippi hospitals

Statistics on the profitability of Mississippi hospitals have been circulating on the radio talk-show circuit in Mississippi. We have heard statements ranging from Mississippi is the most profitable state for hospitals in the nation to our state is in the top five most profitable states. They state that American Hospital Association (AHA) data is the source for their numbers. We have created the attached fact sheet to show that these numbers are not accurate.

Download MHAfactsheet-profitability.pdf

Fact Sheet: Mississippi’s Disproportionate Share Hospital (DSH) Program

Today, nearly 45 million Americans lack health insurance. In 2004, those uninsured persons needed approximately $125 billion in care, with an estimated $40 billion in uncompensated care.

The uninsured access health care services through a "safety net" that includes public hospitals, private hospitals, community health centers and some private physicians. While a broad range of providers serve uninsured patients, the largest share of uncompensated care (66%) - in dollar terms - is delivered by hospitals.

Federal law requires state Medicaid programs to "take into account the situation of hospitals that serve a disproportionate number of low-income patients with special needs" when determining payment rates for inpatient hospital care. This requirement is referred to as the Medicaid disproportionate share hospital (DSH) payment adjustment. Its creation was based on the belief that these hospitals required additional financial support because of Medicaid's low reimbursement rates and the costly burden of serving the uninsured.

In Mississippi, the majority of disproportionate share hospital (DSH) funds go to public hospitals-this structure was created so that a large portion of the overall Medicaid program could be financed through intergovernmental transfers (IGTs). In Mississippi, both public and private hospitals are eligible for DSH if they meet the federal guidelines.

Mississippi's DSH qualification criteria are more lenient for government owned hospitals than for private hospitals. The formula for distribution is also tailored so that government owned hospitals receive approximately 90% of the $190 million in DSH funds available to the state. As a part of the program, government owned hospitals also made transfers equal to 72% of their DSH payment to the Division of Medicaid. These transfers generated an additional $80 million for the Medicaid program that was then matched with federal money. With Mississippi's favorable match rate, this generated a total of approximately $336 million in additional funds available to the Medicaid program. Private hospitals received only about $5 million even though they provide a similar amount of services to the uninsured.

In Mississippi, the University of Mississippi Medical Center is undeniably the largest provider of Medicaid patients and uncompensated care in the state. But not all public hospitals are the largest provider of disproportionate care in their area. Forty-one local government owned hospitals have $209 million in Medicaid cost and $192 million in uninsured cost. Fifty-five private (for profit and non-profit) hospitals have $307 million in Medicaid cost and $223 million in uninsured cost. Four state hospitals (primarily UMC) have $134 million in Medicaid cost and $89 million in uninsured cost.