Reimbursement: How care for illegals may change
Fund expires in September
Reimbursement for care of illegal immigrants could take a big hit as of Sept. 30, 2008 not great news as talk of health care costs, caring for the uninsured, and concern about insurance coverage become more rampant. Lobbyists are taking the issue on now, as hospital administrators, associations, and congressional leaders hit Washington, DC.
At issue is Section 1011 of the Medicare Prescription Drug, Improvement, and Modernization Act of 2003, a measure that established funding to reimburse hospitals for the emergency care of undocumented immigrants. That measure is set to expire in September.
What the death of 1011 could mean
"Those funds assist us with a specific population," says Bridget O'Gara, vice president, communications for the Arizona Hospital and Healthcare Association. "What would happen [if it isn't extended beyond September] is we would revert back to how life was like before 1011. Many of those patients who would be in our emergency departments we would not receive reimbursement for so it would be [considered] charity care or bad debt."
Kevin Burns, CFO at University Medical Center (UMC) in Tucson, AZ, concurs. "There's still some uncertainty from our viewpoint as to whether they'll be able to move this forward after Sept. 30 and it'll hurt. It'll hurt us." UMC is the city's only Level 1 trauma center.
In April, Burns, along with Sen. John Kyl (R-AZ) who Burns and O'Gara credit as being instrumental in the introduction and ultimate passage of 1011 traveled to Washington to push for an extension of the fund, which initially set aside $1 billion ($250 million a year) for fiscal years 2005-2008 to help hospitals cover some of the costs of emergency care of illegal immigrants through "stabilization" (identified by the bill as two calendar days).
Hospitals can apply for reimbursement from Section 1011 only after all other sources of pay have been exhausted; the awarded money covers services mandated by EMTALA and provided by physicians, hospitals, and ambulances. Two-thirds of the fund are divided among the 50 states and the District of Columbia based on their respective percentages of undocumented aliens. The rest is divided among the six states with the largest number of undocumented aliens per fiscal year Arizona, California, Florida, New Mexico, New York, and Texas. To apply for coverage, providers can enroll with Trailblazer, the contractor for the Section 1011 program.
At UMC, multilingual financial counselors in the admitting department work with patients to see if they have any resources to pay for care. Counselors, who are trained on all financial assistance programs, first determine if the patient can be covered by Medicaid or if the patient was in an auto accident, for example, if there is any insurance monies available. "We pursue everything," says Denise Fearing, director of the business office at UMC, "to make sure that we do our due diligence according to the rules of Section 1011." The 365-bed hospital has a program for uninsured self-pay patients to pay at the Medicare rate, the first facility in the state to adopt such a program, says Fearing, who adds that many states have modeled their own after UMC's program.
Because implementation of Section 1011 was delayed by nearly two years, funds will be available until they are exhausted. That might not be long after the original expiration date of September 2008, says Carla Luggiero, senior associate director of federal regulations for the American Hospital Association (AHA), which supports Kyl's efforts to continue a governmental fund to help hospitals defray the costs of caring for undocumented immigrants.
According to a CMS spokeswoman, though, the agency does expect funds to be left over after Sept. 30 and welcomes health care facilities and providers to continue submitting claims.
But in a letter from the AHA to the Senate finance committee, the authors, including several senators and other politicians, write: "Since Section 1011's inception, the Centers for Medicare and Medicaid Services reports a steady growth in the volume of submitted claims, provider payments, and enrolled providers. In a letter to Senator Kyl dated June 28, 2007, then Acting Administrator Leslie Norwalk stated that between the first payment period and the fifth payment period, the volume of submitted claims increased by a total of 317%, the value of provider payments increased by 101%, and the number of enrolled health care providers increased by a total of 107%. Moreover, given the program's growth, Administrator Norwalk wrote that 'CMS anticipates that health care providers will expend all Section 1011 funds.'"
Is it enough?
Are the funds set aside by 1011 sufficient? "I found it is substantive. Is it adequate? Hospital administrators are never going to say it's enough. It's certainly better than a poke in the eye," says Burns. "Could there be more done to help providers not just hospitals, but physicians, ambulance companies? Certainly," he adds, acknowledging that federal budgets and taxpayer money can only go so far.
In April, a car accident involving about 30 illegal immigrants in Arizona illustrated the challenges border states have been, and are, facing. According to the Arizona Daily Star, one of the four hospitals that cared for the crash victims reported the estimated cost of caring for 11 patients at between $44,000 and $55,000. And year to year, treating patients with no insurance coverage costs UMC about $5 million.
"The theory behind [Section 1011]," Burns says, "is somewhat along the lines of it is the responsibility of the federal government to control our borders. So they have to have some responsibility for the cost that is imposed on us by the fact that we have less than stellar border control."
With Section 1011 funds, Burns says, "we probably have been able to offset our expenses to the tune of $1.5 to $2 million to UMC since the initiative was put in place. That's probably about one-fourth to one-third of what our cost will be for caring for that population this year."
Not just a border state issue
If the provision is not extended, it will affect more than the border states, Luggiero says. "Certainly, hospitals, especially those that do have high volumes of undocumented immigrants coming in to their emergency rooms, are very affected. They would have to absorb the cost of the treatment themselves and I have to tell you it's not just along the southern border. We've got other states. North Carolina is a good example. It has a very high population of undocumented immigrants. That is just an example of how this is not strictly something that's along the border. Illinois. Florida, although Florida is not on a border, has a high population of undocumented. New Jersey. New York."
And something is better than nothing. While all hospitals can get some reimbursement with Section 1011, that funding doesn't cover the full cost of emergency care, she says. Ultimately, though, she asserts, Section 1011 funds do help hospitals "maintain at least a little financial wherewithal."
The Washington story
The outlook for Section 1011 is as uncertain as the 2008 presidential election. While some consider a political stalemate on issues to be the trend going into the election, others, including Kyl who sits on the Senate finance committee, are fighting for the provision's extension.
"Obviously there is a need. We know that there are hospitals that but for funding they would have had to curtail their services (cut down on other services in order to accommodate more people coming in to their emergency room). There, of course, is no separate bill," Luggiero says, adding that she hopes the issue will be addressed along with reconsideration of the Medicare physician pay rates slated for this month.
The need is evident.
"Claims have gradually increased over time since the program started and that's an indication that hospitals are becoming more familiar with the funding and how to access it," says O'Gara. "With anything there is a learning curve and that occurred with this as well. Those funds were not tapped as much in the beginning, as people were learning how to do that and how to make sure all the claims were valid, etc. And you can see that the funding source is being tapped more."
For example, in third quarter 2007, Arizona was allotted about $11 million for the quarter and the final payment was about $8 million.
As for the future... "We're in this case the victims of all things politics. There's give and take on Capitol Hill when you have a finite set of funds and you have a number of initiatives under way," says Burns. "We remain hopeful that Sen. Kyl will be able to garner enough support to ask for this program to be continued to help defray these costs."
Stephen Frew, JD, a web site publisher (www.medlaw.com) and risk management specialist, expresses doubt about any policy change heading into the presidential election. "It remains uncertain," he says, "whether the election will lead to effective action from Congress on anything or exacerbate the grid lock that has dominated the scene for much of the past eight years."
We will have to wait and see.
(Editor's note: You can download enrollment forms and other information related to Section 1011 by visiting http://www.trailblazerhealth.com/section1011/. To access the Section 1011 Provider Payment Determination form, see http://www.cms.hhs.gov/CMSforms/downloads/cms10130a.pdf.)
Reimbursement for care of illegal immigrants could take a big hit as of Sept. 30, 2008 not great news as talk of health care costs, caring for the uninsured, and concern about insurance coverage become more rampant. Lobbyists are taking the issue on now, as hospital administrators, associations, and congressional leaders hit Washington, DC.You have reached your article limit for the month. Subscribe now to access this article plus other member-only content.
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