Before the UPL Program

 Before the UPL program, Utah nursing facilities were receiving $100 less per Medicaid patient per day than the actual cost of providing care to those patients, leaving many facilities on the verge of closure,  and  losing millions of dollars per year for Utah health care.

· To address this issue, federal law and federal Medicaid policy allow states to implement UPL programs, an approach used in multiple states for decades, which Utah adopted in 2013 to help provide more funding for the cost of nursing home care, all without any additional funds from the State of Utah.

Program Structure and Funding Flow

· The UPL program allows states to access additional UPL program federal Medicaid funding by combining local public funds with federal matching dollars under established government rules.

· In Utah, participating Non-State Governmental Entities (NSGEs), typically rural hospitals, provide local funding upfront from their own operating accounts. The state uses these dollars to draw down federal matching funds, which are then distributed through the Medicaid system and deposited directly in nursing facility bank accounts to support nursing home Medicaid patient care and related staffing and operations.

Role of Non-State Government Entities

· The federal government mandates that the UPL program be administered by an NSGE, typically a rural hospital: the NSGE must be the licensed operator of participating nursing homes. In addition to providing its own operating funds up front, the NSGE oversees the program and administers compliance. Each participating skilled nursing facility manages its own operations independently with seasoned elder care managers who provide constant daily patient care.

· UPL funds are used by the nursing facilities throughout the fiscal year to support patient care and operations. Once those expenses have been met, any remaining dollars at the end of the year may then be used by the NSGE (as compensation for providing upfront funding and managing the program) to improve healthcare delivery in rural communities, consistent with federal and state program requirements. At that time, the NSGE also is reimbursed for the upfront funding it provided during the year prior. 

Use of UPL Funds

· In addition to supporting nursing home Medicaid patient care, UPL program funds help facilities recruit and retain staff, improve operations, and make needed facility updates that directly affect patient care and quality of life.

· UPL funds have put participating nursing care facilities in a better financial position to qualify for financing, which, in turn, allows them to make critical improvements and upgrades. 

· The results of the UPL program have been dramatic. In addition to improving day-to-day care, UPL program dollars have been used to directly improve patient environments, dignity and outcomes, and to attract and retain qualified staff.

· The matching federal UPL program funds are paid to Utah nursing homes without any cost to Utah taxpayers.

Oversight and Accountability

· When Utah launched its UPL program in 2013, it surveyed similar programs in other states and incorporated additional oversight measures, including enhanced transparency, strengthened controls, and quality metrics to help ensure funds were used as intended. 

· With the requirements of regular audits, consistent detailed reporting, and strict oversight at both the state and federal levels, accountability is built into every step of Utah’s UPL program, making misusing funds virtually impossible.

· Participating NSGEs have meticulously followed Utah’s rules and regulations, along with applicable federal rules and regulations, and Utah’s UPL program is the most rigorously regulated program of this kind in the United States.

Audit Review and Clarifications

· A recent review (and another in 2017) by the Utah State Auditor examined Utah’s UPL program, including how funds are distributed, tracked, and reported across participating entities.

· The audit did not have any findings indicating a failure to comply with state or federal law nor any weaknesses or deficiencies in internal controls.

· The NSGEs, however, were disappointed with the audit, because it misunderstands and misrepresents how this complex program works. Significant efforts were made to help the auditor’s office understand the UPL program, including providing them with extensive information, meeting proactively with the auditor and her team, and submitting detailed clarifications after reviewing the draft audit.

Implications of Program Changes

· The UPL program is vital to supporting and lifting Utah’s ability to care for vulnerable seniors with no additional cost to Utah taxpayers. If the UPL program were significantly disrupted or eliminated, Utah would forfeit more than $100 million annually in federal funds.

· Utah families and taxpayers would bear the financial burden and stress of caring for their loved ones. The state would need to raise taxes, otherwise hospitals would see increased strain on their own resources, and more seniors would be forced to remain at home in potentially dangerous conditions instead of receiving care that should be delivered by nursing facilities.

· The result would be poorer care, fewer options, higher costs, deteriorating or closed facilities, and a crisis for elder care throughout Utah.