Updated: 6:30 p.m.
WASHINGTON, D.C. — Ohio will receive nearly $408 million in federal funds to help cover the costs of treating the poor and uninsured in fiscal year 2009 — an increase of more than $80 million in the previous year.
About $10 million of the federal Disproportionate Share Hospitals funding was added through the economic stimulus packages, according to a press release from U.S. Sen. Sherrod Brown’s office. It’s the first increase for Ohio 2003.
On Friday, the U.S. Department of Health and Human Services said it would add $268 million in federal stimulus dollars to its distributions to states so they could help hospitals that provide a disproportionate amount of charity care . That bumps up allotments available to states to $11.33 billion next year from $11.06 billion this year.
Most of that federal money becomes part of Ohio’s Hospital Care Assurance Program (HCAP), which also includes fees paid by the state’s hospitals. That money, which totaled $510 million last year, is then distributed to the Ohio Department of Jobs and Family Services and administered in part through the Ohio Hospital Association.
However, more than $57 million of the federal dollars will be kept by the state. Also, $93.4 million will be used for the Institutions for Mental Diseases Disproportionate Share Hospital program for free standing psychiatric hospitals, according to the Ohio Department of Job and Family Services.
Typically, health systems that serve a disproportionately high number of low income and uninsured patients — those that provide a disproportionate amount of charity care — receive the funds.
Last year, Cleveland’s MetroHealth System received more than $32 million in HCAP payments, while Cleveland’s University Hospitals system received more than $31 million, according to an HCAP payments list (pdf) from the state.
Earlier in the decade, these federal dollars helped cover all the costs of patients who had incomes that were below 100 percent of the poverty level. It also covered Medicaid losses and some patients whose incomes were slightly above the poverty level, said William Hayes, president of the Health Policy Institute of Ohio. But as federal funding levels froze several years ago, that was no longer the case.
The funding increase comes at a time when the numbers of unemployed and uninsured have increased. Despite the increased funding, Ohio hospitals still face a $1.1 billion revenue shortfall for providing uncompensated care, according to figures from the Ohio Hospital Association. Uncompensated care is increasing at a rate of 10 percent annually.
HCAP “really doesn’t cover the shortfalls of Medicaid and covering the uninsured,” said Dr. Lolita McDavid, medical director of child advocacy and protection at University Hospitals Rainbow Babies and Children’s Hospital.
“I don’t think anyone knows where the bottom (of the economy) is,” McDavid said. “If people are hiring and if the stimulus package will get people back to work, maybe we’ve bottomed out. But I’m reluctant to say where the bottom is going to be.”
[Capitol Hill photo courtesy of Flickr user Will Palmer]
I like this new site, it puts all of the health care stuff that I am interested in in one place. I find it interesting that UH and MetroHealth received just about the same amount of money from HCAP. It doesn't feel right. I suggest that you provide further information about how the HCAP process/formula works. It basically is developed by the Ohio Hospital Association and then approved by JCAR (now chaired by Representative Michael Skindell). How objective is the process when it is crafted by the trade association of the hospital industry?