CMS launches $1 billion program for the uninsured

The Centers for Medicare & Medicaid Services (CMS) has unveiled a new program to provide $1 billion over four years to help hospitals and other providers recoup the costs of providing needed medical care to uninsured patients who cannot pay their hospital bills regardless of the patients’ citizenship status. This action was called for in the Medicare Modernization Act of 2003 (MMA).

The MMA set aside $250 million a year for the next four years (FY 2005 through 2008) to help hospitals and certain other emergency care providers recoup a portion of their costs associated with providing emergency services to qualified individuals who are uninsured or cannot afford emergency care.

Each state will receive funding based on the formula established in the law. Payments will be made directly to hospitals, physicians, and ambulance providers, including Indian Health Service facilities and Indian tribes and tribal organizations, as long as they did not receive payment from any other source such as the person treated or an insurance company.

In implementing the new assistance, Medicare proposes to allocate payments based on the costs incurred for the initial emergency services and associated services, including physician and ambulance services.

According to the new law, two-thirds of the funds will be distributed to all states, with the remaining one-third going to those states with the largest number of apprehensions of undocumented aliens.

"Payments will be made directly to providers, including hospitals, physicians, and ambulance providers, largely for undocumented aliens," says a spokeswoman who cannot be identified under CMS policy.

Providers of ambulance services, for example, will get reimbursement they may not have otherwise received, she explains.

"We hope the additional funds set aside for hospitals that treat undocumented aliens and other uninsured individuals will help keep those hospitals financially viable and will help avoid closures of EDs around the country — particularly those in areas with large numbers of undocumented aliens," the spokeswoman adds.

Under the Emergency Medical Treatment and Labor Act, hospitals with EDs are required to treat and stabilize patients who present with emergency medical needs regardless of their ability to pay or citizenship status.

The cost of this care often strains hospital budgets and can threaten a hospital’s ability to keep its ED open.

The agency anticipates having an implementation plan in place by the Sept. 1 deadline set in the MMA.