Broward Health Issues Comment on Medicaid Fiscal Accountability Regulation

WASHINGTON, Feb. 4 -- Gino Santorio, president and chief executive officer of the Broward Health, has issued a public comment on the Centers for Medicare Medicaid Services' proposed rule entitled "Medicaid Program; Medicaid Fiscal Accountability Regulation". The comment was written on Jan. 31, 2020, and posted on Feb. 4, 2020:

* * *

North Broward Hospital District d/b/a Broward Health ('Broward Health") appreciates the opportunity to publicly comment on the Centers for Medicare & Medicaid Services C`CMS") recently proposed Medicaid Fiscal Accountability Rule, CMS-2393-P (the "Proposed Rule). The Proposed Rule attempts to restrict the use of provider donations, provider taxes, and provider tax waivers in funding state Medicaid programs. Consequently, the Proposed Rule will prohibit public health systems and hospitals like Broward Health from using their public operating funds to draw down a federal match.

The Proposed Rule, if adopted, will cause significant negative consequences throughout Florida and on many of Florida's hospitals and health systems. The Proposed Rule would require local governments to raise taxes and force the State to significantly reduce reimbursements to certain physicians. These, as well as other potential concerns and issues, are discussed in greater detail below.

About Broward Health Broward Health is one of the 10 largest public health care systems in the United States and serves over 30 locations throughout Broward County. Broward Health has been in existence since 1938 and serves nearly 1.3 million residents living in the northern two-thirds of Broward County, in addition to those who travel locally, nationally, and internationally. Broward Health and its hospitals and services have been recognized for its efforts and contributions to health care. As an example, some of these awards include being recognized by US News as a Best Hospital and Center of Distinction for hip and knee replacements. Some of the services offered by Broward Health include, without limitation:

* 4 Medical Centers, with Level I and Level II Trauma Centers and 1 Statutory Teaching Facility

* Salah Foundation Children's Hospital, with Level I Pediatric Trauma

* Graduate Medical Education Program accredited by ACGME, which will include all 4 Medical Centers by 2022

* Memory Disorder Center and related Neurological Services

* Comprehensive Cancer Care

* 2 Federally Qualified Health Centers (since 1991)

* 10 Additional Outreach Clinics (including multilingual and homeless clinics)

* Joint Replacement Centers

* Specialized Cardiovascular Services

* Maternity Care and Level II and Level III NICU Units

* Liver Transplant Program

* Clinical Research and Grant Services.

Florida Specifics In Florida, local governments make substantial contributions to the State that help fund a variety of critical statewide health care initiatives for our residents, both permanent and transitory.

Specifically, local governments provide substantial funding for hospitals and outpatient centers to provide services that serve Florida's poorest and most vulnerable residents (i.e., the Disproportionate Share Hospital (DSH) Program and Florida's Low Income Pool (LIP)). This funding ensures that there is no lapse in health care services for the uninsured and homeless population who receive charity care and provides Graduate Medical Education (GME) funding for the nation's next generation of physicians.

Local contributions in Florida, known as Intergovernmental Transfers (IGTs"), come from legitimate sources, including local property and sales taxes dedicated to health care, broad-based provider taxes that require no federal waivers, and the operating revenue of our public entities. In total, local government contributions for hospitals to the State of Florida via IGTs amount to more than $420 million annually. This investment by Florida allows CMS to match this with an additional $700 million in funding to provide necessary services to the most in need in our communities.

Over the last five years, these local contributions have helped to offset, but not fully cover, the cost of care for the poor and uninsured and to reduce the considerable gap between the cost of care and Medicaid payments. The contributions further serve to alleviate the projected physician shortage in the Florida. To date, over 1,000 new residency slots, many in underserved physician specialties, have been filled; however, there is much more that needs to be accomplished throughout the country.

Broward Health supports simplicity and transparency in Medicaid funding. We welcome the opportunity to advance these goals in conjunction with CMS to ensure compliance and quality for all patients.

We will briefly describe a few examples that will illustrate the potential severity of the Proposed Rule's impact on the health of our local communities and the patients that will be impacted.

This Proposed Rule Will Harm Patients and the Public Hospitals that Serve These Patients Under current law, local governmental entities, public health systems, and public hospitals can transfer public funds to their state Medicaid program to draw down a federal match (42 C.F.R. Sec. 433.51).

With some controls, the current system allows public funds--raised via local taxes and/or operating revenue--to be used and sent to the state or local Medicaid agency for use in the state's share of financial participation. Broward Health uses this funding to support all aspects of Broward Health's mission to serve all patients regardless of their ability to pay, to provide a wide array of hospital services regardless of profitability, and to teach the next generation of health care practitioners for the betterment and quality of our communities.

The Proposed Rule, if adopted, will serve to reduce or even eliminate the Medicaid funding currently used to address the health care of local communities. This, in turn, would reduce money currently used to help fund important health care initiatives designed to improve the health of communities and ultimately will require many local IGTs to be derived from increased taxes and/or increase the costs of health care in an effort to supplement the loss of funding. Alternatively, there would be a significant reduction in services to the most vulnerable individuals. This would undermine the purpose of the Medicaid program and the dictates of Congress.

Broward Health's Success in Reducing the Need for Local Health Taxes Broward Health has been the main provider of health care for the underserved in the northern twothirds of Broward County since 1938. This includes the uninsured, indigent, grant funded, and Medicaid populations. Serving the underprivileged populations increases the overall health and welfare of all individuals and ultimately reduces increased costs on the public for providing health care to individuals with poor health and other complications because of improper health care. Public health systems and hospitals utilize local and public tax dollars to help fund their operations, maintain quality standards, and perform other needed services for the communities that they interact with and serve. These public tax dollars take various forms in accordance with federally and state-imposed regulations. Mostly, these taxes fill in the gaps for the costs for which Medicaid, grants, and other donations cannot entirely cover.

Broward Health has worked tirelessly to reduce the tax burden and dependence on the public. In fact, Broward Health has lowered taxes for eight consecutive years. In the last two years alone, Broward Health saved taxpayers almost $30 million.

Impact on Physician Access to Florida's Medicaid Program Services The Proposed Rule will impose severe consequences on Florida's Medicaid patients who are treated by resident physicians at our medical schools and teaching hospitals. These faculty physicians treat some of the most critically ill and vulnerable patients in the State and provide sophisticated care for many of the most dire and complex medical diagnoses. The Proposed Rule will limit access to these services.

In Florida, approximately 60% of the Medicaid population is covered by Medicaid Managed Care Organizations. Florida currently has a physician directed payment program that applies to the faculty physicians teaching in Florida's medical schools. For many years this program has successfully supported and provided access to the most complex and sophisticated care available in Florida for the most vulnerable residents. This program and its patients will be negatively impacted by these changes.

The Proposed Rule will end the State's wide-open access arrangement and jeopardize both the access and quality of care for all individuals.

The Proposed Rule Will Increase Administrative Workload and Decrease Transparency We support efforts to simplify and streamline Medicaid processes, to give states greater Medicaid flexibility, and to improve transparency and accountability at both the federal and state level. It is clear that CMS is considering the Proposed Rule because certain concerns around states use of provider donations, provider taxes, and tax waivers for Medicaid matching, particularly with respect to the concept of "hold harmless." While CMS's concerns and intentions are legitimate, the Proposed Rule will create more barriers to Medicaid, significantly increase the amount of federally-required paperwork and reviews, create vague (and therefore unpredictable) new standards, and unnecessarily restrict the mechanisms states and local governments can use to finance their Medicaid programs. Indeed, the Proposed Rule contains extensive new paperwork and review requirements. These include new annual reports that states must file regarding:

* Supplemental Payments (447.288(c)(2));

* Annual state reports on Federal Match (447.288(c)(3));

* Evaluations for Certain State Plan Amendments or Renewals (447.290); and

* New DSH Audit Reporting Requirements (447.299 and 455.301).

Additionally, the Proposed Rule creates a new requirement that certain state plan amendments must go through a renewal process every three years (447.252(d)) and also establishes a lengthy list of new information that must accompany any state plan amendment relating to a supplemental payment (447.252(d)).

Current federal law has limits regarding the provider tax rate that can be used to fund these desperately needed financing programs. CMS has been in control of this oversight for years. They approved many of these programs from other states that are now in question. Unfortunately, CMS has introduced rules that will harm those providers that legally abided by the rules that CMS approved and initiated. CMS should create clear legal definitions regarding what is permissible. If CMS cannot perform this function, then Congress should.

Proposed Solution The current rule, which permits the use of these important and necessary public funds for Medicaid's state share, should remain in place. There is always room for improvement, but the Proposed Rule is not the solution. Rather, other options, which would alleviate CMS's concerns and reduce the impact on the public, involve a clarification from CMS that bona fide public health care entities may use their operating funds to utilize and support the federal match used to fund approved Medicaid services at the appropriate federal match rate. Likewise, CMS should use this opportunity to support the appropriate defmition of what constitutes a Publicly Qualified Entity (PQE) (i.e., it must be a nonprofit, have a governance structure that involves elected officials or persons appointed by elected officials, and it must operate in compliance with all federal, state, and local laws). This, along with other suggestions made by commentators, would provide transparency and reduce abuse and waste, but would not have the Proposed Rule's impact on the public because public entities will be permitted to use their operating revenues for federal matching funds in Conclusion We do not believe that CMS intended these consequences and we respectfully request that the Proposed Rule be withdrawn. We believe there are multiple avenues CMS could take that would not require local governments to raise taxes and would not impact access to health care, but would promote higher quality of health care and simplify the Medicaid program without compromising fiscal accountability.

Thank you in advance for your time and consideration. Should you have any questions, concerns, or would like to discuss these issues further, please do not hesitate to contact us at the number above.

Sincerely

Gino Santorio

President and Chief Executive Officer

TARGETED NEWS SERVICE (founded 2004) features non-partisan 'edited journalism' news briefs and information for news organizations, public policy groups and individuals; as well as 'gathered' public policy information, including news releases, reports, speeches. For more information contact MYRON STRUCK, editor, [email protected], Springfield, Virginia; 703/304-1897; https://targetednews.com