Deal picks panel to oversee provider fee

Gov. Nathan Deal has appointed a committee to oversee implementation of the provider fee, the financing mechanism for Medicaid that’s expected to fill a hole of more than $400 million in the program’s budget.

Deal recently signed the fast-tracked legislation that facilitated the renewal of the fee, known among critics as a “bed tax.’’

The oversight panel will consist of six hospital representatives – three from hospitals that have been “winners’’ under the current fee formula, and three from “losing’’ hospitals.

The amount currently raised from hospitals is returned to the hospital industry through reimbursements. Individual hospitals get different amounts based on how much Medicaid business they do, so that some hospitals come out ahead under the formula while others lose money.

The members picked from winning hospitals are David Tatum, a Children’s Healthcare of Atlanta vice president; Steven Gautney, CEO of Crisp Regional Hospital in Cordele; and John Haupert, CEO of Grady Memorial Hospital in Atlanta.

Those from hospitals with net financial losses are Deb Bailey, director of government affairs for Northeast Georgia Medical Center in Gainesville; Bob Quattrocchi, CEO of Northside Hospital in Atlanta; and Doug Welch, CEO of Doctors Hospital of Augusta.

The commissioner of the Department of Community Health, the state’s Medicaid agency, or his designee, will serve as chairman of the oversight panel.

Deal’s executive order, signed Tuesday, said, “it is necessary for stakeholders to bring their considerable expertise to bear in assisting the Department in developing rules, state plan amendments and waivers to implement any provider payments assessed by the Department.’’

The GOP-backed legislation on the provider fee transferred decisions on the assessment from the Legislature itself to Community Health. The current assessment is due to expire at the end of June.

Passage of Senate Bill 24 allowed for renewal of the fee without requiring Republican legislators to vote directly to renew it. Anti-tax activists, who normally have strong influence with the state’s Republican-led government, had wanted the fee scrapped altogether.

The fee assessment still will have to be approved by the board of Community Health, whose members are appointees of the governor. The Community Health board is expected to take up the issue at its meeting next week.

There will be two parts for them to approve. One is a continuation of the current fee, and the second aims to draw down federal money for private hospitals. The latter would help even out the losses for organizations such as Piedmont Healthcare and Northside.

Despite critics’ use of the term “bed tax,’’ the fee currently is not levied on individual patients or on hospital beds, but is based on hospital net patient revenue. Almost all states use such assessments to help cover the costs of their Medicaid programs.

Two-thirds of the provider fee money generated in Georgia goes to shore up Medicaid’s budget. The rest goes to raise Medicaid reimbursements to hospitals.

Grady, which has a large Medicaid patient mix, received more than $9 million from the state’s hospital provider tax in fiscal 2011. Another winner was Children’s Healthcare of Atlanta: Its two hospitals netted a total of more than $22 million, according to state figures.

The biggest loser during that period was Piedmont Hospital in Buckhead, which lost $6.4 million.

Medicaid, jointly financed by the federal government and individual state governments, covers 1.5 million poor and disabled Georgians.