Hospital Financing and Payments

THOT’s hospital financing series explains the variety of hospital supplemental payments, why they matter, and how they are financed.

Check back regularly for additions to this series.

December 2021 UPDATE: HHSC Requested Fee For Service Payments (Hospital Augmented Reimbursement Program: HARP).

THOT’s work on new Medicaid Fee-for-Service payment increases supported two new Texas State Plan Amendments (SPAs) for additional funding to public and private hospitals. On December 13, CMS sent questions to HHSC on these programs and “stopped the clock” on the timeframe for program approvals on the last day before the programs would be deemed effective. CMS’ questions sought additional detail on the method of finance as well as estimated anticipated hospital payments. Under the SPAs, public hospitals would be eligible for $530 million in total funding to help offset Medicaid’s below cost payments for non-managed care (fee-for-service) provided to Texans. Private hospitals would be eligible for $847 million in total funding under this program. CMS’ letters to HHSC may be found at the links below:

Private Hospital SPA:


Public Hospital SPA:


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