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Hidalgo-County-SealThe Hidalgo County Commissioners Court Tuesday approved formation of a county Healthcare Funding District. The district will provide a mechanism for hospitals in Hidalgo County to receive federal matching funds to reimburse them for indigent healthcare services. Through the district, local hospitals will have access to Medicaid reimbursements not previously utilized here.

According to Hidalgo County Director of Health and Human Services Eddie Olivarez, the new Healthcare Funding District could provide access to up to $310 million in funding for indigent health care. This figure includes a local contribution and federal matching funds. The district will collect a fee from hospitals in Hidalgo County up to six percent of the hospitals’ aggregate net revenues. Once these fees are collected, they will be administered by the Hidalgo County Healthcare Fund District managers (Hidalgo County Commissioners). Through a federal funding match of approximately $1.50 for every $1, the county will then receive additional funds that will be distributed among Hidalgo County hospitals as reimbursements for indigent care. The legislation that authorizes this funding mechanism expires in two years, however.

OWLS (Objective Watchers of the Legal System) Virginia Townsend told commissioners to keep in mind that after the two years expires, the burden would shift to county taxpayers to pay an additional tax to replace the indigent care fee that is to be borne by the hospitals now.

Olivarez said Thursday in a telephone interview that he understands Townsend’s concerns, but that is not necessarily the case. The Commissioners’ Court would decide whether and how much local tax revenue will be used for indigent care. And any tax increases would be subject to voter approval. According to County Judge Ramon Garcia, the county is paying about $8 million this year for indigent care.

However, there are already concerns that local officials are planning to implement a new hospital district tax to help fund the new medical school for the Valley. A constitutional amendment on the November ballot, if approved, would allow Hidalgo County to create a hospital district with a maximum tax rate of 70 cents per $100 valuation on homes and businesses. The county already has authority to establish a hospital district, but the tax rate is capped at 10 cents instead of 70 cents.

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