Central Health sets uncompensated care fund rate amid preliminary budget discussions

Central Health officials proposed lowering the district's 2020 fiscal year property tax rate in a preliminary presentation on July 31.

Central Health officials proposed lowering the district's 2020 fiscal year property tax rate in a preliminary presentation on July 31.

Travis County’s Local Provider Participation Fund, which allows private hospitals to access matched federal funds for uncompensated health care costs, will generate approximately $35 million of funds in its first year of operation, according to Central Health documents.

The Central Health Board of Managers on July 31 voted to set the 2019 fiscal year rate for which the county’s hospitals pay into the fund at 1.11% of net patient revenue. According to Central Health documents, that rate is the second-lowest of counties in the state that have set their FY 2019 LPPF rates.

“[The LPPF’s] purpose is to collect mandatory payments … and use that local revenue as a match to draw down federal funds,” said Katie Coburn, director of Regional Healthcare Partnership at Central Health.

Private hospitals in Travis County would pay an established rate of their net patient revenue and pool it into the LPPF fund.

Those pooled funds would then be combined or matched with federal dollars, which would then be redistributed to hospitals in Central Health’s 8-county service area to reimburse uncompensated care costs, according to the hospital district.

According to Central Health documents, the district was granted authority to “assess a mandatory payment to hospitals required to participate in the LPPF” when Gov. Greg Abbott signed Senate Bill 1350 into law May 31.

Williamson County commissioners on April 30 set the rate for the Williamson County Health Care Provider Participation Program at 1.59% of net patient revenue.


Central Health officials presented preliminary FY 2020 budget information to the Board of Managers on July 31, including an early look at the hospital district’s proposed tax rate for the upcoming fiscal year.

According to documents shown at the meeting, Central Health is considering setting its tax rate at 10.4503 cents per $100 taxable valuation, a drop from the current tax rate of 10.5221 cents per $100 taxable valuation.

Even after sinking its tax rate, Central Health still anticipates collecting more money on the average tax bill. According to Central Health documents, the hospital district anticipates it would collect a $364.01 tax bill on a home valued at $348,322—the average taxable homestead value for Central Health—with the proposed rate.

In FY 2019, Central Health collected $343.97 on its average taxable homestead value of $326,895, according to Central Health documents shown at the July 31 meeting.

“This is a proposed budget. I fully expect there to be changes in the budget process,” Jeff Knodel, chief financial officer of Central Health, told managers. “Numbers will change when we receive the certified tax roll from the [Travis County Appraisal District.]”

Central Health is set to hold several public discussions on its budget and tax rate before a final vote on Sept. 24. A community conversation on the FY 2020 budget is scheduled on Aug. 26 and the Central Health Board of Managers will vote on the maximum allowable tax rate on Aug. 28, pending a receipt of the certified tax roll.
By Iain Oldman

Iain Oldman joined Community Impact Newspaper in 2017 after spending two years in Pittsburgh, Pa., where he covered Pittsburgh City Council. His byline has appeared in PublicSource, WESA-FM and Scranton-Times Tribune. Iain worked as the reporter for Community Impact Newspaper's flagship Round Rock/Pflugerville/Hutto edition and is now working as the reporter for Northwest Austin.


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