02/2003 State Legislative Update

Published February 1, 2003

State Update Compiled and edited by Conrad F. Meier

Managing Editor’s Note: With this issue, Health Care News is expanding its coverage of state-based health care news. If you have news to share regarding legislative, political, legal, and business developments in your state’s health care arena, please contact me at [email protected].

Arizona * Colorado * Kansas
Pennsylvania * Texas * Virginia


Illegal Immigrants at Hospitals

Even though U.S. immigration officials are making an effort to limit the number of illegal immigrants who enter the country from Mexico in order to receive uncompensated medical care, there is no evidence the effort is working.

During 2001 Tucson Medical Center (TMC) treated 25 illegal immigrant patients who received medical waivers, or “humanitarian parole,” at the border for an uncompensated medical care cost of $1.5 million. In the first nine months of 2002, the hospital had already treated 23 cross-border patients at a cost of $1.5 million. Year-end figures were not available.

U.S. hospitals along the border have donated medical equipment to Mexican hospitals in order to remedy the problem by improving health care in Mexico. However, Mexican customs officials recently have not permitted shipments of the donated equipment to reach hospitals needing up-to-date equipment.

Dr. Cecilia Rosales, head of the Arizona Office of Border Health, told the Arizona Daily Star, “A lot of it has to do with President Fox’s initiative to quell corruption. Intentions are good; it’s just that it sort of impedes our efforts to improve the hospitals across the border.”

Robert Guerrero, the market administrator for cross-border patients at TMC, said hospitals do not necessarily object to providing care to those with medical waivers; they simply want to be paid for it. He added, “It’s the federal government that allows them in, and it’s the federal government that requires us to treat them. But the federal government does not subsidize the cost.”
Arizona Daily Star
December 16, 2002


Funding Rural Health Care

According to the Denver Post, the state legislature has developed a new plan under which millions of dollars would go to smaller hospitals and medical centers in Colorado.

The Colorado Department of Health Care Policy and Finance on December 17, 2002 suggested the legislature’s Joint Budget Committee change the formula determining how much hospitals receive for treating low-income and uninsured patients.

University of Colorado Hospital, which treats the second-highest number of low-income patients in the state, and Denver Health Medical Center, which provides the most indigent care in the state, could lose hundreds of thousands of dollars per year. Denver-based Children’s Hospital could lose up to $3 million.

Using the revised formula, those funds would be shifted to smaller, rural facilities. “It’s not a windfall,” said C.W. Smith, president of Parkview Medical Center in Pueblo. “We’re not going to be adding a bunch of new clinics or anything with a million more dollars, but it’s something.”

The additional money is unlikely to be enough to expand services or facilities, but it is seen as positive acknowledgement that the problem of the uninsured is not limited to metropolitan areas. Smith says, “All it will do is keep our head above water.”

According to figures from the Centers for Medicare and Medicaid, larger hospitals have been receiving a reimbursement rate of between 60 and 120 percent of the cost of treating indigent patients, while smaller facilities were reimbursed about 30 percent of the cost of care.
Denver Post
December 20, 2002


Minority Health Care Disparities

Minority residents in Kansas are less healthy and have higher rates of chronic diseases than do their white counterparts, according to a recent study conducted by the Center for Advanced Social Research at the University of Missouri-Columbia. The study, funded by the Kansas Health Foundation and the Robert Wood Johnson Foundation, was released at the “Minority Health Disparities in Kansas” summit held December 12, 2002.

The study looked at minority communities in Wichita, Garden City, and Kansas City and found:

  • Infant mortality among African-Americans is double the statewide average.
  • African-American men have the highest rates of prostate, lung, and colorectal cancer in the state.
  • While African-Americans represent fewer than 8 percent of the state’s population, they account for almost 18 percent of the diagnosed AIDS cases in Kansas.
  • Thirty percent of African-Americans and 35 percent of American Indians have high blood pressure, and they die from coronary heart disease at a higher rate than the rest of the population; Hispanics, however, have a much lower rate of coronary heart disease.
  • The cancer death rate for African-Americans is 28 percent higher than that of the state’s general population.
  • Only 67 percent of Hispanic women receive prenatal care in the first trimesters of their pregnancies, compared to 86 percent of the state’s general population.
  • Asian and Pacific Island women are 16 percent less likely than other women in the state to receive Pap smears.

According to the study, minorities often experience language barriers that prevent effective communication of medical histories, poverty, unemployment, lack of insurance, and limited access to health providers.
Wichita Eagle
December 12, 2002
Associated Press/Topeka Capital-Journal
December 12, 2002


Single-payer Low-income Health Plan Expands

AdultBasic, a subsidized single-payer health insurance program for low-income workers and unemployed state residents, may open a waiting list early this year.

The program received $76 million from the state’s share of the tobacco settlement for its first year of operation, July 2002 to July 2003, to provide health coverage for between 40,000 and 48,000 residents.

The health insurance plan requires participants to pay a $30 monthly premium for benefits that include hospital, emergency room, and physician visits for residents ages 19 to 64 with annual incomes less than $17,720 for individuals and less than $36,200 for a family of four.

Participants in AdultBasic pay co-payments of $5 for physician visits, $10 for specialist visits, and $25 for ER visits. The state has contracted with Keystone Health Plan East in greater Philadelphia; Capital Blue Cross/Pennsylvania Blue Shield in central Pennsylvania; Highmark/Western Caring Foundation in western Pennsylvania; and First Priority Health in northeast Pennsylvania to administer the program.

State Deputy Insurance Commissioner Patricia Stromberg said more than 37,000 state residents have enrolled, from an estimated 300,000 who qualify for the program.

After enrollment reaches capacity, the state will allow low-income residents who are above the income means test to apply for a spot on a waiting list to purchase the same health coverage provided under the program for $210.67 per month.
Philadelphia Inquirer
December 26, 2002


Tax to Pay for Uncompensated Care

University Health System officials in San Antonio have asked for a statewide quarter-cent sales tax to help fund uncompensated medical care provided in hospital emergency rooms. Dr. Ronald Stewart, trauma care director at University Hospital, said, “There needs to be some way to make certain the public safety need is met.”

Such a sales tax could generate close to $600 million per year, which would go into a state health department special fund. The fund currently collects unclaimed lottery winnings and distributes the funds to hospitals providing indigent care.

Hospital districts and trauma centers around the state also have proposed implementing new fees on motor vehicle registrations, taxes on firearms and ammunition, and additional fines for people convicted of driving while intoxicated. At this writing, no bills had been filed in the legislature formalizing those proposals.
Houston Chronicle
January 2, 2003


Medicaid Reimbursements To Be Frozen

Governor Mark Warner (D) announced a $1.2 billion budget proposal including nearly $83 million in cuts to the state’s Medicaid program. By freezing reimbursement rates for hospitals, nursing homes, and HMOs treating Medicaid patients, the governor’s office estimates it can save $61 million.

“To soften the impact of these actions,” Warner pledged in his January state-of-the-commonwealth address, “the budget includes about $60 million–half of which is federal–to preserve access to health care. This funding would support special reimbursements to providers who are the sole source of medical services in their communities, or who serve disproportionate numbers of low-income Virginians.”

Warner’s budget proposal also calls for measures to “control the soaring cost of prescription drugs,” hoping to save about $15 million if those controls are effective. The proposed controls include establishing a formulary for prescription drugs available to Medicaid patients; increasing the drug copayment required of Medicaid patients; decreasing fees paid to pharmacies to dispense prescriptions; and requiring prior authorization for drug purchases by nursing home residents who have many prescriptions.

Warner’s proposal drew sharp criticism from several nursing home representatives.

“While we acknowledge that addressing our budget shortfall without additional revenues will force painful cuts to core services, balancing the budget on the backs of frail citizens is not the solution Virginia should pursue,” said Stephen Morrisette, president of the Virginia Health Care Association, a nursing home trade group.

AARP Virginia President Ruth Nelson criticized Warner for not doing more to address unmet medical needs. Nelson was quoted in various media reports saying, “There are still a lot of Virginians that will not have health and long-term care as a result of the governor’s recommendations.”

Overall, the Warner budget proposed a $190 million net increase for health and human services, and State Senator John Chichester (R) predicted there will be “little resistance” to the plan by the 2003 General Assembly. The Assembly returned on January 8 for a six-week session, which is expected to be dominated by the governor’s proposed budget.
Washington Times
Washington Post
Hampton Roads Daily Press
Richmond Times-Dispatch

all December 21, 2002

Recovered Medicaid Funds

In related news, federal and state officials collected almost $1.6 million in repayments from six Virginia medical transport operators indicted last year for overcharging Medicaid.

The six operators ran service vans to transport Medicaid beneficiaries to and from medical offices and hospital visits in the Richmond area. Virginia Attorney General Jerry Kilgore (R) said the Medicaid Fraud Control Unit became suspicious when it noted unusually high billing rates from the six operators.

The FBI and Internal Revenue Service joined the investigation, which included reviews of billing records, interviews with Medicaid beneficiaries, and undercover work. The operators pleaded guilty to federal charges under plea agreements that included jail time, restitution payment, and deportation to their native Sudan. The operators submitted false billings between $3 million and $4 million.

According to an Associated Press report published in the Newport News Daily Press, the money recovered was mostly in the form of travelers’ checks the defendants intended to send overseas. An undisclosed amount of money had already been sent abroad and was not recovered.

“During hard budgetary times, I am truly honored to take this $1.6 million back for the commonwealth,” Kilgore said.
Newport News Daily Press
December 17, 2002