Hospitals, Doctors Apply for “Vital” Status Under Medicaid Waiver

Capital New York

November 5, 2014

Hospitals, Doctors Apply for “Vital” Status Under Medicaid Waiver

By Dan Goldberg

The state's health department on Tuesday released the names of dozens of hospitals, pharmacies, doctors and other providers who are seeking to qualify as Vital Access Providers (VAP) as part of the state's Medicaid waiver program.

The providers seeking the exception, which also must be approved by the Centers for Medicare and Medicaid Services, do not meet the original definition of a “safety net provider,” which limits the amount of funding they can receive under the program.

The Medicaid waiver program, also known as Delivery System Reform Incentive Payment, or DSRIP, encourages the forming of partnerships known as Performing Provider Systems (PPS). Without a waiver, only safety net providers are eligible to receive more than 5 percent of any one group's funding.

The applications are the latest in a series of examples of providers looking to take advantage of exceptions to the waiver's rules, in an attempt to secure some of the $6.5 billion the state will allocate to such groups.

Hospitals and other providers were only supposed to qualify if they met certain criteria, such as having at least 30 percent of their patients be Medicaid recipients, uninsured or dual-eligible.

The original theory was that the bulk of the funding from a Medicaid waiver should go to providers who serve the most Medicaid patients.

The problem is that some of the state's leading health systems, those with the infrastructure and expertise to affect the kind of change state officials hoped to see, generally don't serve a high percentage of Medicaid patients. And there are plenty of physicians and nursing homes that will be important for delivering the kind of integrated care the state desires that also don't treat many Medicaid or uninsured patients.

North Shore-L.I.J., for example, said that 12 percent of its patients are on Medicaid and 2 percent are uninsured. But they are making the case to the state that they are “uniquely qualified to serve,” one of the criteria that qualifies an institution for an exemption.

The health system submitted an application that said it “is a regional Level 1 Trauma Center, a Designated Stroke Center, Bariatric Surgery Center of Excellence, Center of Excellence for Minimally Invasive Surgery in Gynecologic Oncology and Gynecology and is opening urgent care centers that will integrate patient care across NSLIJ and the PPS service area.”

N.Y.U. says its serves 14 percent Medicaid and 2 percent uninsured, but it too says the institution has the expertise to qualify as a unique provider.

“With the DSRIP (Delivery System Reform Incentive Payment) goals of transforming the safety net system and reducing avoidable hospital use by 25 percent, NYULMC will provide the expertise and infrastructure needed for the Lutheran PPS to be a successful (integrated delivery system) IDS.”

Saratoga Hospital and St. Elizabeth Medical Center are two examples of smaller institutions who argued they should qualify as unique providers.

South Nassau Universities Hospital—25 percent Medicaid, 7 percent uninsured—also applied for an exception, arguing the “community will not be served without granting the exception because no other eligible provider is willing or capable of serving the community.”

“Without the exception being granted, communities in the southern tier of Nassau County would not otherwise be served,” their application says. “SNCH serves a large outpatient and inpatient Medicaid population who depend on the Hospital as their primary provider. SNCH’s participation will allow the PPS to offer a complete complement of vital and required services to best serve the Medicaid population of Nassau County. SNCH has a 50.6 percent market share in Long Beach, far in excess of the next hospital with a 7.1 percent share. In underserved Freeport, SNCH’s share is 43.3 percent, well ahead of the next hospital with an 18.9 percent share.”

Physicians groups have also applied for exceptions using some of the same rationale. General Physicians in Elma sees 5 percent Medicaid and 2 percent uninsured but wants an exception because they say there aren't that many primary care providers in Erie County.

Brad Speta, NP, in Wellesville doesn't treat Medicaid patients, according to his application, but should be granted an exception because he “is an essential provider in the Allegany County Community, serving a heavy Medicare and dual eligible population.”

The VAP appeals are open for 30-days fro a public comment period.

Topics: DSRIP

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