Trauma Care Reimbursement:

Poor Understanding of Losses and Coverage for Undocumented Aliens

PEMD-93-1: Published: Oct 15, 1992. Publicly Released: Oct 15, 1992.

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Robert L. York
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Pursuant to a congressional request, GAO provided information on the Medicaid compensation of four southwestern trauma centers for treatment they provided to undocumented aliens.

GAO found that: (1) direct approaches to identifying undocumented aliens are expensive and inaccurate, because of the need to collect data apart from normal hospital procedures and undocumented aliens' presumed preference for concealing their status; (2) indirect approaches to identifying undocumented aliens currently employ unvalidated methods for inferring patients' immigration status; (3) the direct approach to linking undocumented patients to uncompensated costs first identifies the costs attributed to patients classified as undocumented, then credits payments received for these accounts and an appropriate portion of general operating support, which may not be linked to patient accounts; (4) the direct approach can lead to overstated uncompensated costs by failing to credit a portion of operating assistance not directly linked to patient accounts and failing to discount hospital charges to actual costs; (5) another approach uses the proportion of patients determined to be undocumented, multiplied by the net cost of the hospital service in question; and (6) the other approach assumes that undocumented aliens have service utilization and payment patterns similar to other patients.

Recommendation for Executive Action

  1. Status: Closed - Implemented

    Comments: HCFA's regional office has received evidence of implementation from state officials.

    Recommendation: To ensure hospitals' access to the Medicaid reimbursement to which they are entitled for provision of emergency care to certain undocumented aliens, the Administrator, Health Care Financing Administration (HCFA), should verify New Mexico's implementation of this provision, including its publication in internal manuals and communication to the state's major health care providers.

    Agency Affected: Department of Health and Human Services: Health Care Financing Administration


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