Taylor County sets FY2025 hospital payment rate at 3.9% to preserve federal matching dollars

Taylor County Commissioners Court voted unanimously to set the fiscal year 2025 mandatory payment rate for the county’s Local Provider Participation Fund at 3.9% of net patient revenue.

Matt Gilbert, a consultant for Hendrick Health System, told the court the fund “allows the county to generate funds financed entirely by local hospitals, to access federal matching dollars, to offset some of the costs of care for Medicaid and uninsured patients.” He said the program has operated in Taylor County for seven fiscal years and estimated the county would collect approximately $28,000,000 at the proposed rate.

Gilbert described the reason for the lower collection in FY2025 compared with the previous year as a change in the underlying revenue base used to set the rate. “The FY2024 rate was based on 2021 revenues, which were a COVID period,” he said. Using 2022 data, Gilbert said, produced a lower required collection and a proposed rate drop from 4.99% to 3.9%.

Commissioners asked how the change would affect hospitals’ uncompensated‑care burden. Gilbert said Hendrick still incurs large uncompensated costs — “about $60,000,000 of uninsured, uncompensated costs associated with uninsured and Medicaid care every year” — and that the LPPF program significantly reduces that burden by drawing federal matching dollars.

Commissioner Kendrick moved to approve the order establishing the FY2025 rate at 3.9% and Commissioner Statler seconded. The court approved the order on a 5‑0 vote. County staff said the fee applies only to hospitals and that state law prohibits hospitals from passing the fee directly to patients.

The court will sign the formal order and continue program administration through the county finance and health‑care partners. No public comment on the item was offered during the hearing.