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Hospitals, LFD and HRD staff outline how Montana’s hospital utilization fee funds large supplemental payments
Summary
HRD and legislative fiscal staff explained how hospital utilization fees and upper payment limit rules produce substantial supplemental payments; the Montana Hospital Association said hospitals now receive more than they pay and offered figures on reimbursement levels.
Legislative fiscal staff and department officials briefed the subcommittee on how Montana’s hospital utilization fee (HUF) and related supplemental payments operate, and hospital representatives described how the fees translate into reimbursement levels for hospitals.
Why it matters: the HUF has become a significant component of Medicaid spending in Montana. Supplemental payments drawn with hospital tax revenues can materially change hospital revenue and the state’s Medicaid budget, and the presence of Medicaid expansion increases the federal match for those payments.
Overview given to committee: presenters explained the mechanics. The inpatient HUF is a per‑bed‑day fee (testimony referenced the longstanding $70 per bed‑day inpatient fee), and the outpatient fee is a small percentage of outpatient revenue. Those state‑collected fees are used as state match to draw federal Medicaid funds up to an upper payment limit (UPL). The…
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