The Escambia County Board of County Commissioners passed an ordinance on April 22 that helps local hospitals tap into available federal dollars to offset uncompensated health care costs. The Board approved the Local Provider Participation Fund Ordinance that authorizes a special assessment on local hospitals.
There currently is a significant gap in the funds the hospitals receive from the State of Florida and the federal government for Medicaid care versus what they actually expend. The hospitals advised that this gap could be decreased through a non-ad valorem special assessment on inpatient revenues for hospitals within the county owned by Baptist Health Care, Sacred Heart Hospital and any other hospitals within the county's jurisdiction.
Hospitals in Escambia County annually provide millions of dollars of uncompensated care to residents who qualify for Medicaid. Medicaid typically covers 60% of the costs of the health care services actually provided by hospitals to Medicaid-eligible persons, leaving hospitals with significant uncompensated costs. Local hospitals incur over $50 million in uncovered Medicaid costs annually. This is in addition to over $55 million in free/charity care hospitals also provide in Escambia County.
At the request of local hospitals, the LPPF will enable the county to impose a uniform non-ad valorem special assessment on hospitals that have an ownership or leasehold interest in real property in Escambia County. The assessment would be part of a Directed Payment Program (DPP) based on funding formulas dictated by the State Legislature. The Board authorized to impose a special assessment against private for-profit and not-for-profit hospitals located within the county to fund the non-federal share of Medicaid payments associated with Local Services.
"This fund will have a positive impact in the county without imposing new financial obligations on county citizens," said Dawn Rudolph, president of Ascension Sacred Heart Pensacola. "The funds bring new federal revenues to our community to help support our poor and vulnerable patients. I would like to thank the Escambia County Board of County Commissioners for approving this ordinance that supports healthcare for low-income families."
The hospitals will transmit the assessment in one lump sum to the county, which in turn will forward that same amount to the Agency for Health Care Administration, an agency of the State of Florida. The State would then use those funds to draw down a federal match of grant dollars. The total funds, the assessment amount and the federal grant dollars, then will be remitted to the hospitals by the State.
The LPPF will generate millions of dollars to support hospitals and healthcare systems in Escambia County and enable a continued positive impact in the region.
“We are happy to partner with Escambia County and other area hospitals to bring new federal funds into our community,” Scott Raynes, executive vice president, Baptist Health Care, said. “Every dollar assessed will be returned to our community and will bring with it additional federal dollars that would otherwise not have been available to support our residents. This funding will increase our hospitals’ financial stability and our ability to continue to increase the quality of life for all citizens.”
A separate fee resolution and assessment will follow for Board action. Similar arrangements have previously been carried out by the City of Pensacola, Walton County and the City of Orlando.
Ordinance 2021-20 was adopted by the Board on April 22, 2021 and became effective when filed with the Department of State on April 23, 2021.
