1115 Waiver Case Study

Big Bend Medical Center is a full-service, not-for-profit, acute care hospital with 325 beds located in Big Bend, Texas. The bulk of the hospital’s facilities are devoted to inpatient care and emergency services. (Gapenski, pg. 27) The outpatient services section of the hospital is used by the Outpatient Clinic, as well as the Dialysis Center. The Outpatient Clinic, which makes up about 80 percent of the outpatient services section, has recently grown in volume and has created a need for 25 percent more space than it currently has. Moving the Dialysis Center to a new building was decide to allow expansion of the Outpatient Clinic. A change and focus on the allocation of costs has some department heads angry and claiming of

The Internal Revenue Service (IRS) recently released its report to Congress on government-owned and private tax-exempt and taxable hospitals as mandated by Section 9007(e)(1) of the Affordable Care Act (ACA). The ACA requires the IRS to annually submit to Congress a report providing data with respect to private tax-exempt, taxable, and government-owned hospitals regarding (1) the levels of charity care provided; (2) bad debt expenses; (3) unreimbursed costs for services provided with respect to means-tested government programs; and (4) unreimbursed costs for services provided with respect to non-means-tested government programs. The ACA also requires the report to include information with respect to private tax-exempt hospitals regarding costs incurred for community benefit activities.

Since most specialty procedures are inpatient services, EMC’s inpatient occupancy rate suffers. The occupancy rate for Emanuel Medical Center – fifty percent – is far below that of its competitors and industry benchmarks. To accompany this, EMC (on average) receives a lower reimbursement for in-patient Medicare services per patient seen in comparison to its competitors. A result such as this is correlated with directly to the fewer amount of specialty services that EMC offers. In order for Emanuel Medical Center to be able to compete with other hospitals in its service area, it is imperative that EMC evaluates what services they currently offer and are capable to offer in the future to add value to the hospital, increase its revenue stream, and expand its patient mix. Currently, Emanuel Medical Center has not succumbed to its increasing financial pressurealthough EMC has had a negative operating income for five straight years. A negative operating income places EMC at a disadvantage because it limits the hospitals ability to renovate its aging building or hire new specialists to offer revenue enhancing procedures. EMC’s competitors, on the other hand, have large sources of revenue due to their mergers with large healthcare networks such as Catholic Healthcare West. Another competitor, Kaiser Permanente Modesto Medical Center, has extremely large financial resources due to the fact

The original capitated management agreement with the city will continue to run Bobcat hospital into the deep red, so I recommend asking for a rate increase to cover all

The unexpected closing of the local plant due to the downturn in the economy and the amount of layoffs as a result has reduced the amount of income tax collected in the city. Income taxes fund 23% of the projected budget revenues for police and fire services. The lowering of the available revenues from income tax for funding of police and fire services will have dire repercussions. The projected income for the fire department is greatly needed to replace the aging truck fleet. The loss of this income could result in loss of life because the city has insufficient fire trucks that operate

According to the hospital’s five-year plan, an investment in capital equipment should boost the quality of services offered at the hospital. Many options of capital investments that hospital could invest in exist. However, this report recommends an investment in the MRI (Magnetic Resonance Imaging) equipment. This equipment involves a large capital investment upfront, but it can be profitable in the end. The hospital has considered factors such as the cost of this equipment, the facilities needed, and the return on investment of the equipment. The above factors are among some of the factors that are considered when buying large capital equipment for an organization such as a hospital (Keefer,

Seven of the thirty-three states that adopted Medicaid expansion obtained section 1115 Medicaid demonstration waivers. These waivers allow states flexibility in operating state-specific Medicaid programs beyond what is available under current law. Indiana is among the seven states that are using a Federal waiver to continue its seven-year-old Healthy Indiana Plan instead of implementing the traditional Medicaid expansion offered by the ACA. The Healthy Indiana Plan, also known as HIP 2.0 since 2015, is a health insurance program for uninsured adults with income at or below 138 percent of the Federal poverty level.1 Indiana Medicaid has three programs for patients with serious mental illness, emotional disturbances, and substance use

Many forms of 1915 and 1115 waivers have been proposed and implemented in Florida and other states in the past. According to Holahan, Coughlin, Lipson, & Rajan (1995), the section 1115 research and demonstration waivers are designed to allow states to develop new solutions to health and welfare problems. The federal government may waive some standard Medicaid rules if the change is deemed to be budgetary, no higher than it would have been expected without the waiver (Holahan et al., 1995). States using these waivers have proposed to save money by using managed care plans for current Medicaid patients, and limiting the cost of new Medicaid enrollees (Holahan et al., 1995).

The cost of the health care industry has always been rising since the early 1980s. It has been a growing concern in both the industry and society. Massachusetts General Hospital (MGH) is no exception. Even though the average length of stay (LOS) for the patients in MGH has been declining (Exhibit 10), it is still the highest compared to their competitors (Exhibit 6). Besides the cost, there is no uniformity of process and standardization across different facilities and departments of the hospital. MGH lacks communication and coordination between the facilities.

Texas, which currently has a large uninsured population and limited Medicaid eligibility, forfeits billions of dollars from the federal government every year by not expanding its Medicaid program as implemented in the Affordable Care Act. In contrast, Medicaid expansion could benefit the state exponentially and give its citizens the fullest potential of what this country offers. A substantial amount of federal funding that could increase uninsured coverage, improve healthcare costs, and provide economic stimulus is left on the table. Additionally, the nation benefits when each state participates, contributing to the success of the healthcare reform.

A comprehensive satellite health clinic will reduce admissions, as well as re-admissions to the current single hospital within the county. This extra resource will reduce the possibility of competitors moving into the area, specifically those from neighboring hospitals that could bring the needed services that PMH is lacking and looking to provide. Additionally, consumers feeling forced to travel out of the area for care, or those facing the potential of being transferred out of the area due to the severity of the case as a result of inadequate primary and preventative care, or lack of space will diminish through these efforts.

Throughout the early 1980’s and 1990’s the Federal Medicaid program was challenged by rapidly rising Medicaid program costs and an increasing number of uninsured population. One of the primary reasons for the overall increase in healthcare costs is the

As mentioned by Thompson (2010), in the Associated Press, “Lawmakers bridged a $19 billion shortfall, more than 20 percent of the $87.5 billion general fund spending plan”. This shows that the state was heading towards a financial crisis and more deficit creation. Moreover, Thompson (2010), in the Associated Press also points out that “It includes no tax or fee increases but uses a combination of cuts, funding shifts, delayed corporate tax breaks and assumptions about money the state hopes to receive”. The budget gave rise to other dependent costs such as delayed tax refunds. It was uncertain that the State will receive the required funds from the federal government to ensure that the important programs will function the way it used to be until the funds are received.

According to the American Hospital Association the cost of equipment, services, and information services has risen drastically. A huge problem for hospitals now is that there has been an enormous increase in patients who have Medicare or Medicaid. The Hospital Association states that “60% of all admissions. Neither program fully reimburses the cost of hospital care.” Not only is the hospital not getting paid the full amount through the health insurance, but they have also seen a jump in people who do not have insurance and cannot pay for their hospital expenses this averages out to about six percent of hospital expenses. Hospitals must assume these costs as a part of their charity pay. These costs are then calculated and increase the costs of health care for people who pay for it, in order to cover these costs.

In a traditionalist state, such as Texas, the financial toll that Medicaid would have on its taxpayers was on the frontlines. The Texas legislature was worried about whether or not its taxpayers would face a tax increase to cover the increased cost of those covered by Medicaid. These taxpayers would inadvertently pay for the hospital bills of those who are uninsured in Texas through an average $1,800 rise in the cost of their premiums (Rapoport, 2012). In support of expanding Medicaid, Texas would receive federal funds in order to ease the cost that accompany the expansion. Since Texas decided not to expand Medicaid, Texas “would be leaving billions and billions of federal dollars on the table” according to Anne Dunkelberg (Rapoport, 2012). Not only does this monetary incentive give Texas an extra push to participate towards expanding Medicaid but it would also help the residents of the state to get insured. Texas legislators understood that this monetary incentive would not fully cover the cost of the newly enrolled Medicaid recipients. In the end, they would have to rework the annual budget and increase taxes in order to cover these extra recipients.