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C K GC-4 *• oiy 3Loo>- AA/bS • > 3120bb D277 715fi 1 Report of the Commission on Special Uncompensated UNCOMPENSATED CARE POOL SPECIAL COMMISSION December 2002 16, Her Excellency the Governor The Honorable Mark Montigny, Chair, Senate Ways and Means Committee The Honorable John H. Rogers, Chair, House Ways and Means Committee Patrick F. Scanlan, Clerk ofthe Senate Steven T. James, Clerk ofthe House The State House MA Boston, 02133 Dear Governor Swift, Senator Montigny, Representative Rogers, Mr. Scanlan and Mr. James: The Special Commission on Uncompensated Care hereby submits its final report. The Commission was established by Section 74 ofChapter 177 ofthe Acts of2001, as amended by Sections 171 and 173 ofChapter 184 ofthe Acts of2002. The Commission first met on September 9, 2002. Pursuant to Section 26 ofChapter 300 ofthe Acts of2002, the Commission is required to submit its final report by December 16, 2002. This Special Commission met while the environment for providing and funding health care for the uninsured and low income population was stressed and in flux. The Commonwealth is experiencing a fiscal crisis. One response to that crisis is to plan to limit eligibility for the MassHealth Basic program effective April 1, 2003. Another is to eliminate some benefits in the MassHealth program. Unemployment is also increasing, and many who rely on employer health insurance may be forced to utilize the Pool for health care inthe upcoming months. These factors are expected to increase demand on the Uncompensated Care Pool. The Division of Health Care Finance and Policy and the providers werejust completing implementation ofa new electronic data submission, analysis, and reconciliation system that is producing new information on Pool usage. It should result in not only more timely and useful data for policymakers, but also more effective administration ofthe Pool, as the prior Commission had recommended. But, it also meant thattrending ofconsistently defined data was not always possible and the data and analysis were not always available during the time the Commission met. Finally, changes in both the executive and legislative branches ofgovernment will occur in January 2003. Because ofthese many changes that are currently in process, and in light ofthe time available to the Commission, it is not surprising that the Special Commission is not able to submit agreed to recommendations on whichthe full Commission took individual votes. However, the attached report provides detailed information about the various issues that we have explored, and transmits the reports and options proposed by the Division ofHealth Care Finance and Policy, 1 1 I 1 « (I I I members ofthe commission and sub-committees established by the Commission. The information and analysis submitted by members ofthe commission and by the Division ofHealth Care Finance and Policy, as contained in the report, do not necessarily represent the views ofthe entire commission. At the final meeting ofthe full commission, the options that the sub-committees developed, two by votes, and one by consensus, were received There was a unanimous vote by Commission members that the sub-committees' work and additional options submitted by individual and groups ofcommission members should be identified as such and included in the Commission's final report The Commission further agreed that a seven-day period would be allowed for interested parties to submit additional materials for inclusion as part ofthe record. The report presents information and analysis submitted to the Commission, including background information on Pool history, current structure, management and relationship to other programs, as well as data demonstrating cost trends, services paid for by the Pool, and demographics ofpatients who incurred these services. In addition, the report transmits options for future study by the Administration and Legislature submitted to the Commission regarding the future ofthe Uncompensated Care Pool. Several of these were presented to the Commission during its meetings. The first ofthese was submitted by five Commission members: Associated Industries ofMassachusetts; Blue Cross Blue Shield of Massachusetts; Massachusetts Association ofHealth Plans; Massachusetts Business Roundtable; and Massachusetts Taxpayers Foundation. Other recommendations were submitted separately by the Massachusetts Council ofCommunity Hospitals, the Massachusetts League of Community Health Centers, staffofthe Division ofHealth Care Finance and Policy, and the Massachusetts Hospital Association. Subsequent submissions included ajoint letter from the Massachusetts Hospital Association, the Massachusetts League ofCommunity Health Centers, Health Care for All, the Massachusetts Nurses Association, and the Massachusetts Council of Community Hospitals, as well as additional separate recommendations from Children's Hospital, Health Care for All, and the Massachusetts Nurses Association. The members ofthis Special Commission believe that resolving the issues facing the Uncompensated Care Pool requires the urgent attention ofthe Legislature and the new Administration. The detailed information and the broad range ofoptions included in this report will enable you to make informed decisions regarding the Uncompensated Care.Pool. Senator Riicchhaarrdd TT.. MMooooffee RReenprreesseennttaattiivvee DDaanniieell KKeeeenan Co-Chair Co-Chair Secretary Robert Gittens Co-Chair, Designee for the Secretary ofAdministration and Finance Sec. 173 ofCh. 184 ofthe Acts of2002 Digitized by the Internet Archive 2013 in http://archive.org/details/reportofspeOOmass (/^ (SU*. y/uuu puJJU^ ~ Bruce Bullen Ronald M. Hollander ^c^A^^C <(HS& C. U~ Jafnj^ W. Hunt, Jr. Richard C. Lord fi^U^L. "TtfSL ~ Peter Meade ~ ~ • Robert Restuccia 1 Table of Contents STATUTORY MANDATE 1 MEMBERSHIP 3 SPECIAL COMMISSION PROCESS 4 BACKGROUND INFORMATION 5 LegislativeHistoryofthe Uncompensated Care Pool 5 RecentHistoryof the Uncompensated Care Pool (1997-present) 6 Regulations 6 Surcharge 7 Settlements 7 Data Collection 8 Demonstration Projects 8 UncompensatedCarePoolProjections 9 HospitalEnvironment 10 Analysis ofVariance 16 EligibilityfortheUncompensated CarePool 19 Eligibility Criteria 19 Application Process 19 Emergency BadDebt 19 Uncompensated CarePool Demographics andUtilization 21 CurrentMassHealthEligibility 38 Description of MassHealthCoverage Types 39 Comparison ofMassHealthandUncompensated Care Pool Services 40 Comparison ofUncompensated Care Pooland MassHealthBenefits 4 HospitalIncentives forAssistingPatients toApplyforMassHealthvs. Free Care 42 FinancialIncentives 42 Regulatory Requirements 42 : Operational Considerations 42 Comparison ofPaymentLevels between MassHealth and UCP 42 Insurance Partnership 43 Uncompensated Care PoolAudits 46 Authorization 46 Implementation 46 Findings 46 SUBMISSIONS FROM COMMISSION MEMBERS 49 RECOMMENDATIONS SUBMITTED TO THE SPECIAL COMMISSION ON UNCOMPENSATED CARE 63 Associated Industries ofMassachusetts, Blue Cross Blue ShieldofMassachusetts, MassachusettsAssociation ofHealthPlans, Massachusetts Business Roundtable, Massachusetts Taxpayers Foundation 64 MHA Response 68 Massachusetts Councilof CommunityHospitals 72 Massachusetts League of CommunityHealth Centers 78 DivisionofHealth CareFinanceandPolicy Staff 80 MHA Response 84 Massachusetts HospitalAssociation 87 Massachusetts HospitalAssociation, Massachusetts League of CommunityHealth Centers, HealthCare forAll, MassachusettsNurses Association, Massachusetts Council of CommunityHospitals 92