AUSTIN, Texas—(Sept. 2, 2016) Texas hospitals will incur more than $8.2 billion in unreimbursed health care costs in fiscal year 2017 if supplemental payments, currently distributed through the Medicaid 1115 Transformation Waiver, are no longer available once the waiver expires at the end of 2017, according to an independent study conducted by Health Management Associates on behalf of the Texas Health and Human Services Commission. These unreimbursed costs are those associated with providing health care services for individuals enrolled in the Medicaid program and those who lack health insurance.
Texas has the highest rate of uninsured in the nation, with approximately 19 percent of the population lacking health insurance. Reducing the uninsured rate by implementing a health insurance program for low-wage working Texans would reduce unreimbursed hospital costs by approximately $358 million, according to the HHSC study.
The study also notes thatthe amount of unreimbursed hospital care is almost certain to grow, based on demographics, underlying market factors and projected cuts to the Disproportionate Share Hospital payment program as required under the Patient Protection and Affordable Care Act.
“The independent study confirms what Texas hospitals have long known – that supplemental payments are absolutely essential to our ability to provide quality health care services to all Texans,” said Ted Shaw, THA president/CEO. “We are hopeful that this study provides the necessary evidence to support continued supplemental payments in 2018 and beyond as CMS and HHSC negotiate the next version of the 1115 waiver.”
The study, released yesterday, was required by the Centers for Medicare & Medicaid Services as part of terms and conditions attached to the temporary extension of the 1115 waiver agreed to in May that extends supplemental payments through December 2017.
About the Texas Hospital Association
Founded in 1930, the Texas Hospital Association is the leadership organization and principal advocate for the state’s hospitals and health care systems. Based in Austin, THA enhances its members’ abilities to improve accessibility, quality and cost-effectiveness of health care for all Texans. One of the largest hospital associations in the country, THA represents more than 85 percent of the state’s acute-care hospitals and health care systems, which employ some 365,000 health care professionals statewide. Learn more about THA at www.tha.org or follow THA on Twitter at http://twitter.com/texashospitals.