1. Maryland Health Services Cost Review Commission
Overview of the Uncompensated Care Methodology
03/20/2014

2. Objectives Update results of applying uncompensated care policy
Approx ½% increase in uncompensated care 2013>2012
Consider impact of Affordable Care Act and Medicaid Expansion
Reduction in UCC by about 1% due to PAC expansion
Evaluate variables given changing uninsured
Expansion populations
Undocumented immigrant populations
Other contributors to bad debts and charity care

3. What is Uncompensated Care (UCC) in Maryland?
The HSCRC’s provision for uncompensated care in hospital rates is one of the unique features of rate regulation in Maryland.
Uncompensated care (UCC) includes bad debt and charity care.
By recognizing reasonable levels of bad debt and charity care in hospital rates, the system enhances access to hospital care for those citizens who cannot pay for care.

4. Maryland UCC Methodology
The HSCRC uses a regression methodology as a vehicle to predict actual uncompensated care costs in a given year.
The uncompensated care regression estimates the relationship between a set of explanatory variables and the rate of uncompensated care observed at each hospital as a percentage of gross patient revenue.

5. Maryland UCC Methodology (continued)
A 50/50 blend of the predicted value for the hospital’s uncompensated care rate based on the last available year of data and three-year moving average is used to calculate a hospital’s preliminary amount in rates.
The hospital’s preliminary amount in rates is then adjusted for charity care and the amount of uncompensated care in rates across all hospitals are 100% Pooled.

6. Current UCC Explanatory Variables
The following variables are included as explanatory variables:
The proportion of a hospital’s total charges from inpatient non-Medicare admissions through the emergency room;
The proportion of a hospital’s total charges from inpatient Medicaid, self-pay, and charity cases;
The proportion of a hospital’s total charges from outpatient non-Medicare emergency department charges; and
The proportion of a hospital’s total charges from outpatient Medicaid, self-pay, and charity visits.

8. New UCC Explanatory Variables under Consideration
The current emergency room variable is no longer working, so a replacement variable is needed
Existing variables may need to be replaced as nature of uninsured changes
Evaluate alternative variables
Remaining contribitors to uncompensated care

9. Impact of Medicaid Expansion on UCC
PAC population
PAC represents about 1% of charges
Estimated to account for about 15% of uncompensated care, based on historical data
Up to 1/3 of uncompensated care for some hospitals
Focus on considering in 2015 UCC estimates

10. What is the Primary Adult Care Program (PAC)?
PAC is a health care program for low income adults age 19 and over who have minimum income. Individual Maryland residents age 19 or over who do not qualify for full coverage through Medicaid or receive Medicare are eligible if their income does not exceed $1053 a month.
PAC covers the cost of prescriptions, primary care, mental health care, hospital emergency room services, treatment for addiction, and other limited services.
PAC does not cover inpatient or outpatient hospital services or specialty services.
You do not need to have a medical condition to qualify.

11. PAC Inpatient and Outpatient Charges, Gross Patient Revenue, Uncompensated Care Amount and Percent by Hospital for Fiscal Year 2013
HOSPID
Hospital Name
PAC Inpatient Charges
PAC Outpatient Charges
Gross Patient Revenue ($)
Uncompensated Care ($)
Uncompensated Care Percent
210001
Meritus Medical Center
3,873,372
1,094,130
301,350,700
21,682,200
7.20%
210002
Univ. of Maryland Medical Center
19,401,160
3,097,748
1,241,601,500
67,006,500
5.40%
210003
Prince Georges Hospital
2,230,604
469,614
249,192,600
38,639,500
15.51%
210004
Holy Cross Hospital of Silver Spring
1,053,206
394,493
461,351,200
42,720,100
9.26%
210005
Frederick Memorial Hospital
2,542,352
426,871
337,093,700
20,318,600
6.03%
210006
Harford Memorial Hospital
1,250,120
289,893
104,451,400
12,160,700
11.64%
210008
Mercy Medical Center, Inc.
3,491,140
2,693,123
470,759,600
39,008,100
8.29%
210009
Johns Hopkins Hospital
12,251,177
3,902,844
2,132,419,000
90,951,400
4.27%
210010
Univ. of Maryland Shore Medical Center at Dorchester
998,649
592,738
59,897,900
4,186,100
6.99%
210011
St. Agnes Hospital
4,747,087
1,013,755
404,669,900
32,204,000
7.96%
210012
Sinai Hospital
5,865,969
1,594,209
684,516,800
37,059,900
5.41%
210013
Bon Secours Hospital
5,758,774
1,183,557
121,044,100
23,113,200
19.09%
210015
Franklin Square Hospital
3,776,005
630,823
469,792,200
33,166,000
7.06%
210016
Washington Adventist Hospital
1,264,915
170,861
260,716,100
34,587,700
13.27%
210017
Garrett County Memorial Hospital
178,334
135,072
42,302,400
4,593,400
10.86%
210018
Montgomery General Hospital
1,090,640
198,495
166,869,100
10,997,700
6.59%
210019
Peninsula Regional Medical Center
3,851,304
1,403,163
412,641,500
28,334,500
6.87%
210022
Suburban Hospital Association,Inc
708,260
76,570
280,578,500
14,223,100
5.07%
210023
Anne Arundel General Hospital
2,096,937
772,892
541,867,800
28,229,300
5.21%
210024
Union Memorial Hospital
4,215,526
1,644,962
406,581,900
33,074,500
8.13%
210027
Braddock Hospital
2,191,586
1,118,495
314,237,300
21,637,900
6.89%
210028
St. Marys Hospital
1,056,149
606,681
154,603,000
13,099,300
8.47%
210029
Johns Hopkins Bayview Med. Center
8,814,346
1,375,348
596,807,300
55,404,000
9.28%
210030
Univ. of Maryland Shore Medical Center at Chestertown
367,692
117,179
62,791,800
6,363,400
10.13%
210032
Union Hospital of Cecil County
1,582,610
1,173,969
153,372,900
13,323,600
8.69%
210033
Carroll County General Hospital
1,523,784
198,951
249,075,200
11,694,600
4.70%
210034
Harbor Hospital Center
2,528,756
395,285
201,141,000
17,275,600
8.59%
210035
Univ. of Maryland Charles Regional Medical Center
888,311
207,535
137,003,900
10,219,200
7.46%
210037
Univ. of Maryland Shore Medical Center at Easton
867,557
665,993
186,358,600
10,917,000
5.86%
210038
Univ. of Maryland Medical Center Midtown Campus
4,571,084
2,918,350
216,173,800
32,904,000
15.22%
210039
Calvert Memorial Hospital
1,001,876
447,700
138,862,900
8,548,200
6.16%
210040
Northwest Hospital Center, Inc.
2,094,846
218,385
248,252,700
20,881,800
8.41%
210043
Univ. of Maryland Baltimore Washington Medical Center
3,224,099
522,807
376,812,800
36,844,300
9.78%
210044
Greater Baltimore Medical Center
1,184,083
405,260
421,137,700
13,135,500
3.12%
210045
McCready Foundation, Inc.
43,572
449,212
17,975,600
1,495,300
8.32%
210048
Howard County General Hospital
1,282,404
416,574
278,901,600
16,701,900
5.99%
210049
Upper Chesepeake Medical Center
1,268,543
424,108
283,588,000
16,858,800
5.94%
210051
Doctors Community Hospital
1,067,479
231,163
216,854,500
20,137,500
9.29%
210055
Laurel Regional Hospital
1,074,031
72,401
121,542,100
17,298,700
14.23%
210056
Good Samaritan Hospital
2,120,043
526,513
295,736,800
19,525,100
6.60%
210057
Shady Grove Adventist Hospital
1,797,960
180,475
348,706,200
23,215,600
6.66%
210058
Univ. of Maryland Rehabilitation and Orthopaedic Institute
1,078,213
212,660
115,227,400
5,988,400
5.20%
210060
Fort Washington Medical Center
236,239
159,459
46,176,400
5,723,300
12.39%
210061
Atlantic General Hospital
521,446
877,566
99,487,100
7,638,100
7.68%
210062
Southern Maryland Hospital
2,048,205
657,135
144,983,300
9,922,800
6.84%
210063
Univ. of Maryland St. Josephs Medical Center
2,051,182
383,842
337,661,500
17,305,500
5.13%
218992
Univ. of Maryland (MIEMSS) -
474,129
188,680,900
42,108,600
22.32%
Statewide Totals
127,131,631
37,222,989
15,101,850,200
1,092,424,500
7.23%