CMS has approved a five-year waiver by the Texas Medicaid program to transition beneficiaries into managed-care programs, while retaining the state's Upper Payment Limit funds, according to a report by the Houston Chronicle.
Earlier this year, Texas legislators approved a plan to move all of the state's Medicaid recipients into managed care plans. Without a waiver, the move would have jeopardized the state's roughly $2 billion in UPL funds, which are distributed to hospitals as a way to reduce losses on providing care to Medicaid patients, according to a report by The Monitor. Essentially, the UPL funds increase funding for Medicaid services to Medicare-reimbursement levels. However, they are calculated based on the fee-for-service model, and transitioning hospital payments to a capitated fee risked access to the UPL funds.
CMS' decision to grant the waiver protects the state's UPL funds for five years. Under the waiver, the UPL funds will go toward two separate pools — one which will be used to distribute incentive payments to providers that increase quality while reducing costs and another which will be used to distribute payments to providers that treat a large number of uninsured payments, according to The Monitor report.
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Earlier this year, Texas legislators approved a plan to move all of the state's Medicaid recipients into managed care plans. Without a waiver, the move would have jeopardized the state's roughly $2 billion in UPL funds, which are distributed to hospitals as a way to reduce losses on providing care to Medicaid patients, according to a report by The Monitor. Essentially, the UPL funds increase funding for Medicaid services to Medicare-reimbursement levels. However, they are calculated based on the fee-for-service model, and transitioning hospital payments to a capitated fee risked access to the UPL funds.
CMS' decision to grant the waiver protects the state's UPL funds for five years. Under the waiver, the UPL funds will go toward two separate pools — one which will be used to distribute incentive payments to providers that increase quality while reducing costs and another which will be used to distribute payments to providers that treat a large number of uninsured payments, according to The Monitor report.
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