A Medicaid fee that brings in $31 million in federal funds for Georgia’s private hospitals was nearly sidetracked Tuesday because of the opposition of one member of the board of the state Department of Community Health.
The board member, former Gwinnett County legislator Clay Cox, agreed to reverse himself after it was pointed out that his “no” vote could effectively kill that portion of the state’s hospital provider fee, an important funding mechanism for Medicaid.
The Community Health Board ended up giving initial approval to the hospital provider fee and is expected to adopt it at the board’s November meeting.
The hospital provider fee – sometimes referred to as a “bed tax” – is collected from Georgia’s hospitals by Community Health.
That hospital fee revenue is used as matching money to attract additional federal funding for Medicaid services – amounting to about $450 million a year — and the federal dollars are redistributed to the hospitals.
The main part of Georgia’s provider fee was approved by the feds last year.
But a second part of that provider fee, called Tier II, is aimed at helping hospitals that are financial “losers’’ under the main distribution formula — private hospitals such as Piedmont Atlanta Hospital and Northside Hospital, which serve a smaller percentage of Medicaid patients. (Here’s a GHN article about the Tier II fee.)
The U.S. Centers for Medicare and Medicaid Services (CMS), which oversee state Medicaid programs, approved Georgia’s Tier II fee for fiscal year 2014 but said the state would have to make a technical change to its fee calculation methodology to get approval for the current fiscal year.
DCH Commissioner Clyde Reese said CMS officials are requiring the state to delete organ acquisition costs from the Tier II fee methodology.
“Why organ acquisition costs became such an issue with CMS, I don’t think a lot of us in the state of Georgia are very clear on that,” Reese said.
If the fee methodology is not adjusted, then private hospitals could potentially lose about $31 million in federal funds, he said.
During a telephone conference call meeting Tuesday, Community Health board members were asked to give initial approval to the revised fee methodology, which normally would be a routine matter.
Only five of the board’s seven members were on the conference call, however, and Cox voted against the fee adjustment, which made the vote for initial adoption 4-1. Cox indicated he was voting against it because he opposes the concept of a hospital bed tax.
While the Community Health Board has seven members, five “yes” votes are required to approve a change in fees, Reese said.
“This motion does not pass,” Reese said. “A quorum still remains five, so we will bring this issue back before the board at the regularly scheduled meeting in October to see if we can get five votes for it at that time.”
“I’ll be willing to withdraw my ‘no’ vote and vote ‘yes’ for initial adoption if the chairman will note my opposition to the hospital bed tax,” Cox said. He added that he would vote against the revised fee when it comes up for final adoption in November.
Board Chairman Norm Boyd called for a re-vote, which resulted in unanimous approval for initial adoption of the modified fee, keeping it on track for final passage in November.
“I will note his [Cox’s] opposition for the record,” Reese said.
The unusual sequence of events at the Community Health board meeting followed a decision Gov. Nathan Deal made three weeks ago not to reappoint two board members, Bill Wallace and Jamie Pennington.
Wallace had been vice chairman of the DCH board and Pennington had been secretary. Boyd appointed Cox as the interim vice chairman and Donna Moses as the interim board secretary.
Tom Crawford is editor of the The Georgia Report, which provides online coverage of state politics. Here’s a link to his original article.