(The Center Square) — Gov. Tate Reeves announced on Thursday a Medicaid reimbursement reform proposal that could provide more than half a billion dollars for the state’s hospitals.
The first-term Republican governor says it will come at nearly no cost to Mississippi taxpayers.
The $689 million, two-part proposal must be approved by the federal Centers for Medicare and Medicaid Services and would be funded by annual assessments hospitals pay to the state’s Medicaid program. These assessments are calculated using a formula provided under state law.
The first part of Reeves’ proposal, known as the Mississippi Hospital Access Program, would provide direct payments for hospitals that serve patients in the state’s Medicaid managed care delivery system. Hospitals would be reimbursed near the average commercial rate, which is the upper limit for Medicaid managed care reimbursements.
The other part of the proposal would supplement Medicaid payment rates for hospitals providing inpatient and outpatient services up to Medicaid’s regulated upper payment limit. The calculation used to provide this would be similar to an emergency payment of $137 million provided earlier this year through the Mississippi Division of Medicaid.
Reeves also provided a list of the financial benefits for his proposal to Mississippi’s hospitals.
The University of Mississippi Medical Center in Jackson would receive more than $66 million annually from the plan once taxes were paid. The Greenwood LeFlore Hospital, which is danger of closure due to financial issues, would receive a nearly $10.3 million infusion. North Mississippi Medical Center would receive nearly $33.5 million per year.
When asked if the initiative would help struggling rural hospitals, Reeves said it would likely help them.
He also said expanding Medicaid, as proposed by his Democratic opponent in this November’s gubernatorial election, Northern District Public Service Commissioner Brandon Presley, would not provide much of a benefit to them. Mississippi is one of 10 states that have not expanded Medicaid using federal assistance.
Reeves campaigned in 2019 against “Obamacare expansion.” He signed a bill this past session that extended Medicaid coverage for 12 months for eligible post-partum women.
“Overall, I’ve got to believe that an increase of more than $690 million will go a long way toward helping some of their challenges,” Reeves said. “This isn’t going to solve all of their challenges. This isn’t going to be the end of the road for the conversations we have going forward. We have two states to our west, Louisiana and Arkansas, that have expanded Medicaid. If you look at the percentage of rural hospitals that currently are in financial risk of closure, the percentage in Louisiana and Arkansas is almost identical to Mississippi that are at risk for closure.
“The only thing you can take from that in my mind is that the expansion of Obamacare, while it certainly adds a certain number of people to the welfare rolls, does not have the kind of financial impact that some of you in this room and some people across the state think that it will have.”
Reeves also called for prior authorization reform, which is where an insurance company determines whether it will cover a procedure or medication. A bill that would’ve required insurance companies to hasten the process on prior authorizations was vetoed by Reeves.
The governor said in his veto message that it would’ve increased health care costs by requiring a panel of physicians to review prior authorization requests on a short timeline, thus placing a burden on insurers that they’d likely pass on to Mississippi customers. He also said in his veto message the bill would’ve presented compliance challenges to the state’s Medicaid system.
