Medicaid: Proposed neonatal, pediatric intensive care unit rate bumps may boost in-state hospital care

Megan Messerly
Megan Messerly
Health CareLegislature

Lawmakers peppered Medicaid officials during a Friday budget hearing with questions over how a proposed rate hike for neonatal and pediatric intensive care unit services would expand or maintain access to care and whether there is more the state can do to ensure mothers receive prenatal care to deliver healthier babies.

Deputy Medicaid Administrator Cody Phinney told legislators that the proposed 15 percent increase to the per diem rate hospitals receive for pediatric intensive care unit (PICU) patients and the 25 percent bump for neonatal intensive care unit (NICU) patients would maintain or possibly increase the level of these services that in-state hospitals currently provide. Part of the goal of the rate increases, she said, is to encourage Nevada hospitals to offer these services so vulnerable patients aren’t transported across state lines for care.

“One thing that we are concerned about is the fact that in Nevada — our geography being the way it is — people often have to travel for this level of care anyway,” Phinney said. “To have people travel even farther, or people who shouldn’t otherwise have to travel go out of state, we’d like to see that reduced as much as possible.”

Part of encouraging Nevada hospitals to maintain or expand those services, Phinney said, is getting Medicaid reimbursement rates for NICU and PICU services closer to the actual cost of providing the care. Though patients with private insurance typically subsidize the cost of providing care to Medicaid patients, that isn’t true when it comes to NICU and PICU care where an outsized number of patients are on Medicaid, she added.

“These services in particular are disproportionately impacted by Medicaid because we cover so many of the births and an even higher proportion of the births who need these levels of care,” Phinney said. “So there isn’t the offset that you might have in services where higher portions are covered by commercial insurance that sometimes helps us.”

Sunrise Hospital, one of the largest providers of NICU and PICU care in the state, launched a public awareness campaign in November to urge lawmakers to raise the two rates, and in January, newly-elected Gov. Steve Sisolak included them in his recommended budget. Sunrise and other hospitals supportive of the proposal argue that they won’t be able to continue providing the current level of services they do without a rate increase.

“I ask not only for your support for this funding but also for your support for higher reimbursement rates for hospitals like Sunrise Hospital so we can continue to provide the best care for everyone in our state,” Sunrise CEO Todd Sklamberg implored lawmakers during a January budget meeting.

During the Friday hearing, lawmakers drilled into how Medicaid settled on a 15 percent bump for PICU and a 25 percent increase for NICU and whether the new rates would cover the costs of providing services. Phinney said the rates are a byproduct of discussions with the Nevada Hospital Association and an analysis of hospital billed charges, cost data, and the rates other states pay for similar services.

Phinney added that the neonatal increase is higher than the pediatric one because of recent increases in the pediatric rate that had already brought it closer to the cost of providing care.

“We continue to look at the cost of those services, and we’re trying to get as close to the cost of those very intensive, expensive services,” Phinney said.

Assembly Ways and Means Chair Maggie Carlton, who has long butted heads with hospitals and warned in January that lawmakers would go through the proposed rates “very, very closely,” pressed Medicaid officials during the hearing about whether there is more the state can do to expand access to prenatal care for mothers, particularly those who are undocumented.

“I do know there is a population that cannot access [prenatal care] because of their legal status, and I’m just wondering — especially with the hospitals that I’ve heard of that are so interested in this, that’s the population that they serve — if we had healthier babies the day they were born, would we be addressing this issue?” Carlton said.

Thirty states have implemented a mechanism known as presumptive eligibility that allows pregnant women to obtain immediate, temporary Medicaid coverage without having to wait until a full eligibility determination has made. Nevada is not one of the those states, according to a Kaiser Family Foundation tracker of presumptive eligibility.

“One of the things that happens is because mom isn’t covered under Medicaid but the minute the baby is born, the baby is covered under Medicaid, moms aren’t getting the prenatal care they need,” Carlton said. “There’s head nods in this room that have been around 20 years that remember this discussion. It’s always stuck with me because I truly believe if we could address presumptive eligibility, that we wouldn’t have as many babies in this predicament.”

Carlton also pressed Medicaid officials on whether there is data from other states showing that increase to NICU and PICU rates results in a corresponding increase in availability of services.

“Because to me it’s all about the access. It’s not about the profit center,” Carlton said. “I understand there’s a need, and I’m glad that you know the cost because it’s been very difficult to get cost on certain things as we’ve had discussions about hospital costs and things. I think I’d really like to understand if this increase will really increase the access to the care for the moms and the babies.”


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