The Louisiana Department of Health and Hospitals is preparing to pay out another $8.9 million to rural hospitals this month to help preserve access to healthcare for rural communities. The payments are made under an Upper Payment Limit (UPL) Program designed by DHH and championed by State Sen. Francis Thompson and the Louisiana Rural Hospital Coalition.

In addition to the budget authority provided for the UPL programs in House Bill 1, Gov. Jindal signed Senate Bill 401 of the 2010 regular session by Sen. Thompson to authorize payment to rural hospitals up to the Medicare rate, commonly referred to as the Upper Payment Limit. UPL is the difference between the Medicaid rate and the Medicare rate. The federal Centers for Medicare and Medicaid Services (CMS) can authorize a state to pay a provider a supplemental payment to bring them up to the Medicare rate. A UPL payment requires state match to draw down the federal funds and both the state and federal funds are paid to the provider. DHH submitted a State Plan Amendment to CMS on September 28, 2010 outlining the Rural Hospital UPL plan. CMS granted approval for the inpatient services plan on March 16, 2011 and the outpatient services plan on April 28, 2011.

In State Fiscal Year 2011, DHH paid approximately $37.2 million to rural hospitals through this program, and to date has already paid nearly $18 million in State Fiscal Year 2012. The Rural Hospital UPL is expected to generate more than $35.8 million for rural hospitals by the end of the current fiscal year.