New payment plan would compensate children’s hospitals

An alternate payment method that could compensate some Minnesota hospitals for lost reimbursement payments would be created under a bill passed 130-0 by the House Thursday.

Sponsored by Rep. Joe Schomacker (R-Luverne) and Sen. Tony Lourey (DFL-Kerrick), HF1619/SF1616* would compensate hospitals in the state designated as “children’s” hospitals, which could lose money because of a federal change in how the formula reimbursing them for treating patients on Medical Assistance is interpreted.

State Medicaid programs are required under federal law to make Disproportionate Share Hospital payments to hospitals that treat a large number of Medicaid and uninsured patients. But a formula change for how those payments are calculated could cost the state’s children’s hospitals $25 million this year unless a solution is found.

Schomacker said the bill would set up an alternate pay method so hospitals could get the funds via a different route, allowing them to continue “to serve our most sick and needy children in the state.”

Passed 66-0 by the Senate April 6, the bill now heads to Gov. Mark Dayton’s desk.