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PLN mentioned in article re TDCJ medical care contracts

Fort Stockton Pioneer, Jan. 1, 2014. http://www.fortstocktonpioneer.com/news/article...
PLN mentioned in article re TDCJ medical care contracts - Fort Stockton Pioneer 2014

TTUHSC verbally agrees on new Medicare contract


Posted: Thursday, March 6, 2014 5:00 am
By CHRIS ADAMS reporter@fspioneer.com | 0 comments

Texas Tech University Health Science Center verbally agreed to a new correctional care contract with the Pecos County Memorial Hospital pending approval from the Legislative Budget Board (LBB).

PCMH CEO Jim Horton terminated the former contract in December of 2013 due to a reduction in the Medicare reimbursement payment rate. TTUHSC had slashed the rate to 98 percent of the Medicare rate. This two percent decrease placed a significant financial strain on PCMH and forced them to end their contract.

Horton said last December that he had wanted to do business with TTUHSC and provide health care to inmates but the payments they were willing to disperse weren’t enough to cover the hospital’s costs.

The proposed new contract stipulates that PCMH will receive payments at 132 percent of the Medicare rate through July 31, 2015. PCMH is also actively pursuing retroactive Medicare payments from TTUHSC for the months of December 2013 and January/February of 2014.

“We need…to make it clear to the community that this is not us dragging our feet…it’s not the hospital that’s dragging its feet, it’s something going on between Tech and TDCJ,” stated hospital board president Jim Miles.

Seemingly, no government entity has wanted to take the responsibility of initiating the Medicare cut.

“The federal government last spring reduced Medicare payments by two percent. UTMB (University of Texas Medical Branch) and TTUHSC by law follow the same payment methodology as Medicare and therefore reduced their payments by two percent,” said Jason Clark, public information director of the TDCJ.

Dave Pearson, executive director of the Texas Organization of Rural and Community Hospitals (T.O.R.C.H.), said that hospitals had informed them that the two percent reduction apparently came from TTUHSC and/or the Texas Department of Criminal Justice (TDCJ). Additionally, it was reported that the state had put a ceiling on the Medicare payment rate.

“The reason given was that state law capped payments at Medicare rates (TDCJ Rider 55 for FY12-13 and TDCJ Rider 50 for FY14-15), and that Medicare rates were cut by two percent under the federal sequestration last spring,” stated Pearson in a Nov. 20, 2013 correspondence to the TDCJ.

“While we see jumping to the two percent cut conclusion, we believe there is a misunderstanding on the mechanics of how sequestration was applied to health care providers by the Centers for Medicare and Medicaid Services (CMS). CMS did not actually lower Medicare rates for hospitals and other providers. Their payment and fee schedules remain the same.”

Rider 50 FY14-15 states that, “TTUHSC, UTMB or any other contracted CMHC (Correctional Managed Health Care) health care providers shall provide inpatient and outpatient hospital services through contract hospital providers for offenders in the custody of the Department of Criminal Justice at a rate not to exceed 100 percent of what would be paid for similar services according to the Medicare reimbursement methodology. Department of Criminal Justice may pay a rate in excess of Medicare reimbursement rates only after receiving prior written approval from the Legislative Budget Board.”

The wording of Rider 50 attempts to be definitive but then contradicts itself. It has left several hospital administrators scratching their collective heads. Even the two percent diminution has baffled many people.

“As the language in Riders 55 and 50 was actually drafted in 2011-long before anyone knew sequestration was going to occur-we construe that the legislature never anticipated, nor intended for such an interpretation or cut. We have yet to find a member of the legislature that was aware that a two percent cut had been put into effect,” said Pearson in the TDCJ correspondence.

There is a lot of gray area hovering in the dark regarding this reimbursement affair, but most indicators point to this issue being born and raised somewhere between Austin and Lubbock, not rural locations west.
“We need…to make it clear to the community that this is not us dragging our feet…it’s not the hospital that’s dragging its feet, it’s something going on between Tech and TDCJ,” stated hospital board president Jim Miles.

Upon examination of TTUHSC payment rates to hospitals, urban hospitals such as Northwest Texas Hospital in Amarillo and Hendrick Medical Center in Abilene are receiving rates much higher than the 100 percent Medicare limit.

“A second and more troublesome issue, is the recent revelation to rural hospitals that they are being paid far less than larger hospitals for very similar care,” revealed Pearson in the same correspondence. “…It came to light that TDCJ has been seeking approval from the LBB to pay larger hospitals rates up to 15 times Medicare…while rural hospitals were cut to 98 percent of Medicare rates. We find no logic or government policy that adequately explains why this disparity should occur.”

The TDCJ indicated that the onus is on TTUHSC to negotiate rates with the hospitals.

“Healthcare for TDCJ offenders is provided by UTMB and TX Tech. The universities negotiate independently with the hospitals in their network to ensure the effective use of state dollars,” explained Clark.

TTUHSC furnished this explanation regarding the rates.

“Reimbursement for TDCJ offender offsite health care is set at Medicare rates by the Texas Legislature pursuant to Rider 50. Any exceptions to Medicare rate reimbursement require Legislative Budget Board approval,” commented Mary Croyle, executive director of TTUHSC Communications and Marketing.

There is a lot of gray area hovering in the dark regarding this reimbursement affair, but this issue appears to have been born and raised somewhere between Lubbock and Austin, not in rural points west.

“We need ... to make it clear to the community that this is not us dragging our feet ... it’s not the hospital that’s dragging its feet, it’s something going on between Tech and TDCJ,” stated hospital board president Jim Miles.
In 2011, TTUHSC was faulted by the Texas State Auditor for their methods of charging indirect administrative costs to Correctional Managed Health Care (CMHC) during fiscal years 2009 and 2010.

An article in Prison Legal News reported that, “TTUHSC charged a flat rate of six percent of total revenues for indirect costs. Thus, the agency charged the contract $11,800,000 in indirect costs.... The auditors’ main problem was that TTUHSC could not produce documentary proof that the indirect costs associated with providing prisoner medical care were actually that high.”

Last year, Thomas Hough, a manager at the TTUHSC office of Correctional Managed Health Care, was charged with a felony theft of $584,198.76 from the university. Investigators said he stole the funds over a five-year period beginning in 2007 and ceasing in 2012.

CMHC is an independent advisory committee/board formed by TDCJ, UTMB and TTUHSC to manage and assist in the facilitation of Texas inmate health care. It was essentially created to curb the amount of fines the state was receiving due to its unconstitutional level of inmate health care a few decades ago.