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Directive may affect hospitals’ funds

Profile image for By Karina Ramírez / Staff Writer
By Karina Ramírez / Staff Writer

A federal directive may impact how local hospitals get funding for uninsured patients and Medicaid beneficiaries.

Representatives from Texas Health Presbyterian Hospital Denton, Denton Regional Medical Center and Baylor Health Care System asked Denton County commissioners to consider having the county join the Regional Health Partnership 9 to ensure future Medicaid funding.

The county is part of Regional Health Partnership 18 as assigned by the Texas Health and Human Services Commission. Earlier this year, the commission received federal approval of a Medicaid 1115 waiver to allow the state to expand its Medicaid managed care program. In February, the commission grouped Denton County with other counties north of Fort Worth and Dallas to the Oklahoma border.

“They [hospital representatives] came to me about a week ago concerned that Denton County would lose millions of dollars if we remained in Region 18 and not Region 9,” said County Judge Mary Horn.

According to, the 1115 waiver expands the eligibility of individuals who are not otherwise Medicaid- or Children’s Health Insurance Program-eligible. It provides services not typically covered by Medicaid and uses innovative service delivery systems to improve care, increase efficiency and reduce costs.

The wavier also divides the state into regions known as regional health partnerships, or RHPs. Each RHP is represented by an anchor entity that becomes the primary contact to the Texas Health and Human Services Commission. The anchor becomes the main recipient of future delivery system reform incentive payments — the entity that would get matched Medicaid dollars transferred from the federal government to academic medical centers, public health agencies, etc. for their services.

Regional Health Partnership 18 comprises Denton, Collin, Grayson, Cooke and Rockwall counties, with the anchor entity being Collin County. Dallas and Kaufman counties are in RHP 9, with Parkland Memorial Hospital in Dallas as its anchor entity.

Stan Morton, CEO of Texas Health Presbyterian Hospital Denton, told commissioners that the processes for how the Medicaid waiver would be funded change day by day.

“The request we are seeking today allows Denton County to be in the best position to continue upper payment funding,” Morton said during Tuesday’s meeting.

Presently, a private hospital participates in an “upper payment limits” program that helps fund underserved-population initiatives.

The federal government is using the Medicaid 1115 waiver to replace the payment program, according to Morton.

The waiver is known in Texas as the Healthcare Transformation and Quality Improvement Program.

Steve Love, president and CEO of the Dallas-Fort Worth Hospital Council, a group that works with 80 hospitals in North Texas, said the waiver is creating two funding pools: an uncompensated care pool — costs of care provided to individuals who don’t have Medicaid funds; and delivery system reform incentive payments.

Texas has the potential to receive up to $29 billion over the five years of the waiver, which is more than the $14 billion in funds that are available under the upper payment limits program, according to the Texas Hospital Association’s website.

Love said anchors must submit their regional health partnership plans to the state’s health commission by Sept. 1, since the state also has to meet its own deadline of Oct. 31 to submit its plans to the Centers for Medicare & Medicaid Services.

“Given the current framework of the 1115 waiver, aligning with RHP 9 not only better reflects the normal traffic pattern of patients as they seek various levels of health care, [but] it also allows us the greatest opportunity [if approved] to fund burden-relief services that otherwise migrate to our safety net hospitals, such as Parkland,” said Caleb F. O’Rear, CEO of Denton Regional Medical Center.

In a letter to the county commissioners on Tuesday, O’Rear said that RHP 9 would be the best region for Denton County since many patients who require care not available in Denton tend to go to hospitals in or near Dallas.

Love said hospital officials are working together to ensure the process is being done correctly and all state and federal requirements are met.

“The waiver allows you to expand the Medicaid managed care and at the same time allow you to participate in the waiver,” he said.

Commissioners asked about the administration and role of the anchor entity, once approved.

“We definitely have to work in collaboration with Parkland, but the Parkland board doesn’t control the process,” Morton said. “The contractual relationships will be between the individual providers, so if we take on a project that will require funding, it will be the hospitals that would be taking on that obligation.”

Horn said the commissioners decided to support the hospital officials’ recommendations, but it was difficult to make an informed decision with the pressing deadline, Horn said.

“There are too many unanswered questions, but you have to participate or we are going to cost our hospitals monies,” she said.

Love said the 1115 waiver is new territory and hospital officials are trying their best to understand it.

“We have never done this before,” he said. “The county commissioners, and the hospitals and everyone involved have done an excellent job to make this work. It is a unified effort to do what is best for the citizens of Denton County.”

KARINA RAMÍREZ can be reached at 940-566-6878. Her email address is .