May 23, 2019
Private hospitals can receive Federal Funding to Care for People with Low Income
(Austin) – Two new laws passed by the Texas Legislature will improve care for people in Travis County with low income.
Senate Bill 1142 allows physicians working for Central Health to have an expanded ability to practice medicine, helping the organization better provide medical care for Travis County residents with low income.
Senate Bill 1350 gives the Central Health Board of Managers the ability to create and administer a local provider participation fund (LPPF) to use as a vehicle to ensure the continued ability to leverage federal matching dollars for hospital care for the population it serves.
Senate Bill 1142
Central Health, Travis County’s healthcare district, now has the power to appoint, contract for or employ physicians as a result of the passage of Senate Bill 1142—a significant change for the 15-year old healthcare district.
Central Health does not provide direct medical care, but instead funds care, paid for by local property taxes, by partnering with a network of clinics and hospitals. Historically, Central Health employed physicians in executive or managerial positions, but the doctors were not permitted to directly care for patients due to state laws and regulations overseeing the practice of medicine in Texas.
“This means Central Health physicians will now be able to make medical decisions about appropriate care for patients,” Central Health President & CEO Mike Geeslin said. “Central Health doctors will also be able to provide direction to nursing staff, such as during home visits, or refer patients to another doctor or specialist. Our doctors were limited in their scope before.”
Central Health contracts with health care providers to care for patients with low income in the Medical Access Program (MAP), MAP Basic and Sliding Fee Scale programs.
“This bill will help Central Health improve efficiency, reduce costs, and most importantly improve the health of our community. It makes sense to put Central Health on even footing with most of the other major hospital districts in the state who have this authority,” Senator Kirk Watson, the bill’s author, said.
Senate Bill 1142 was authored by Senator Kirk Watson (Senate District 14) in the Texas Senate and sponsored by Representative Donna Howard (House District 48) in the Texas House. The bill went into effect immediately upon signing by the governor, and mirrors statutes in place for 17 other Texas hospital districts.
“I feel it’s in the best interest of everyone served by Central Health, which last year was almost one out of every seven Travis County residents, to make sure every asset we have at our disposal is accessible to provide the best health care possible. I’m proud of the role we played in changing that statute, and grateful to my colleagues for supporting the bill and to Governor Abbott for signing it into law,” Representative Donna Howard said.
In addition to permitting direct care for patients, the bill also allows physicians on staff to perform operational duties that would otherwise have been delegated to hired contractors. The ability to make decisions about the drug formulary or manage patient referrals and triage waitlists based on medical necessity, among other roles, all improve Central Health’s overall efficiency.
Senate Bill 1350
The Texas Legislature also passed Senate Bill 1350, allowing Central Health to establish a local provider participation fund (LPPF) in Travis County. The Central Health Board of Managers approved a resolution in April supporting the bill.
LPPFs are financial structures administered by public entities like Central Health that allow private hospitals to continue accessing federal matching funds to pay for care provided to people who don’t have private insurance and cannot afford to pay.
Safety-net hospitals in Travis County incur significant unreimbursed costs while caring for uninsured and Medicaid patients, many of the people Central Health serves. An LPPF would allow hospitals in Travis County to receive federal funding to pay for health care services for those with low income and no insurance. Under an LPPF, private hospitals would agree to pay into a fund administered by Central Health. The local funds would be combined, or matched, with federal dollars then re-distributed by the state and federal government to area safety-net hospitals.
“Texas has the highest rate of uninsured residents in the nation, so the ability to capture more federal matching funds to pay for their care is a great benefit to us, and to our partners who also provide care. Ultimately, we’ll be better able to help more people while realizing some additional financial support for the services we provide,” Central Health Board of Managers Chair Dr. Guadalupe Zamora said.