Team B (Augusta Gose, Tammy Brown, Tiffany Kenny, Rudy Burns, Steven Delgado RES/351
November 5, 2012
Approving a health care provider assessment proposal will reduce the amount of charity cost and bad debt that Banner Health and other healthcare organizations incur. Having a provider assessment in place for Banner Health would be beneficial to the hospital and patients due to the Arizona Health Care Cost Containment System (AHCCCS) and Medicaid cuts. The state budget cuts went into effect on January 1, 2011, which eliminated coverage for over 310,000 Arizonans (Borns, 2012). A possible revenue source is a provider assessment, a state law that authorizes collecting revenue from specified categories of providers. Provider assessments provide a more stable source of revenue than sales tax, which funds more than half of the General Fund for Arizona, which in turn provides state dollars for AHCCCS. Since assessments are frequently a percentage of profit earned by the identified provider, they are based on the actual cost of care and are more able to keep pace with the rising expenses in health care. This provider assessment would be used to generate new in-state funds and match them with federal money so that the state receives additional federal Medicaid dollars. Currently Arizona has a 2% premium revenue tax levied on health insurers, which includes AHCCCS plans, as a form of provider assessment (Borns, 2012). Research problem and purpose
The research problem is finding a better solution for hospitals, and other health care organizations to operate without having to deal with issues on funding that is paid out by state and federal government programs. The purpose is finding a financial solution to reduce the rising bad debts and charity costs that have affected Banner Health since the budgets cuts went into effect on January 1, 2011. Problems of Medicaid Cuts & the Significance of the Provider Assessment The purpose of our reviewing the Provider Assessment is to determine if the assessment will decrease Banner Health’s bad debt and the use of charity cost. The problem is in 2011, Governor Janet Brewer to made substantial Medicaid cuts, stopping over 310,000 members AHCCCS (Arizona Health Care Cost Containment System) benefits. With these Medicaid cuts, the state of Arizona was supposed to be saving $1,234 per person that was taken off Medicaid (AHCCCS) per year, which is estimated to be $382.54 billion a year. In turn of the state cutting these costs the federal government lost $765.7 billion a year from Medicaid reimbursements. For Banner Health this has impacted the bad debt (people who have rendered hospital services, but have not paid for their treatment) was $74 million, a $31 million increase over the same time period in 2010, when it was $43 million. Banner Health’s charity care (which is medical treatment for people whom there will be no reimbursement sought due to a lack of financial resources or are underinsured) was at $103 million an increase of $52 million, which is doubling the amount used for the same period in 2010, at $51 million. The AHCCCS program has resulted in a significant and negative impact on hospitals throughout Arizona. In regards, to all of the fiscal damages caused by the Medicaid cuts the significance of the Provider Assessment fee help build up Arizona’s Revenue. Other states have recently implemented new provider assessments to increase coverage. Arizona is in a different position. A provider assessment would likely only serve to maintain the current levels of coverage that exist today. Borns, K. (2012) Hypothesis
A Hypothesis is the key aspect to any experiment or research process because it creates a scope for the research to be focused. The Hypothesis that Team B selected will determine if the Arizona State Senate should remain on the state's current Medicaid budget or should the...