Somervell County Commissioners on Monday approved an agreement between Glen Rose Medical Center and Baylor University Medical Center to join forces in covering the costs of uncompensated “indigent” care that hammer them financially.
The “Indigent Care Affiliation Agreement” calls for GRMC and Baylor to work together to expand their so-called “upper payment limit,” or UPL.
The UPL program has been around for years and is designed to bridge the gap between the cost of providing services for patients on Medicaid and the state's low rate of reimbursement.
The county's Hospital Authority Board approved the agreement last month.
The program requires a government entity to participate.
Hospitals in Clifton and Hamilton have reached similar agreements with a large health care provider, Providence.
County Attorney Ron Hankins noted that Baylor will begin doing its part before even getting any money.
“It's a strange federal program, but all indications are that both hospitals benefit, so I'm good with it,” Hankins said.
The UPL program started in large Texas public hospitals. It's since expanded to small rural hospitals and to public-private partnerships. GRMC and the Hospital Authority Board recently heard the details from Kevin Reed with the law firm of Davis & Wilkerson, P.C.
Medicare is all federally funded, while Medicaid is a matching state and federal program. For each dollar the state puts into Medicaid, the federal government matches it with $1.50.
?GRMC doesn't provide a high level of Medicaid services (although its nursing home does). But considering that more than half of the births in Texas occur with patients who fall under Medicaid, large hospitals such as Baylor get hammered.?
A government entity, such as the county in this case, can put more money into the Medicaid program and get more matching money, Reed explained. That means that the Hospital Authority can enter into an indigent care affiliation agreement with a private partner such as Baylor and another governmental entity - the county - sends money to the state, the state puts it in the Medicaid account, the feds send matching money and that money is sent to Baylor, which then sends some of it back to Glen Rose.?
If the county provided about $500,000 annually for the UPL program, Baylor would receive about $1.5 million during the first year at an average 1.96 federal match.?Baylor has indicated a desire - but is not obligated - to provide indigent care services in Somervell County. The relationship is one based on trust. GRMC will identify the Medicaid services it needs to provide and tell Baylor what its needs are.
According to Reed, residents of Somervell County could realize about $1 million in services, or about $500,000 in excess of the UPL payments made by the county.?Under the agreement, Baylor would assume some of GRMC's expenses in July, August and September. The county's part would not come due until October or November after its new budget begins.
Board members said they hoped the UPL program could help the hospital stem its losses due in part to providing charity care to people who cannot pay their health care bills. ?In May, for example, 324 people requested charity care, for a total of more than $747,000.??