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A06677 Summary:

BILL NOA06677B
 
SAME ASSAME AS S05546-A
 
SPONSORGottfried
 
COSPNSRReyes, Dickens, Mosley, Weprin, Rodriguez, Santabarbara, Cruz, Barron, Niou, Crespo, Paulin, Jaffee, Simotas, Seawright, Ortiz
 
MLTSPNSR
 
Amd 2807-k, 2807 & 2807-c, Pub Health L; amd 211 & 212, Chap 474 of 1996
 
Relates to general hospital and safety net hospital reimbursement rates and Medicaid adjustments.
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A06677 Actions:

BILL NOA06677B
 
03/15/2019referred to health
05/08/2019amend and recommit to health
05/08/2019print number 6677a
01/08/2020referred to health
01/10/2020amend and recommit to health
01/10/2020print number 6677b
01/22/2020reported referred to ways and means
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A06677 Memo:

NEW YORK STATE ASSEMBLY
MEMORANDUM IN SUPPORT OF LEGISLATION
submitted in accordance with Assembly Rule III, Sec 1(f)
 
BILL NUMBER: A6677b
 
SPONSOR: Gottfried
  TITLE OF BILL: An act to amend the public health law, in relation to the general hospi- tal indigent care pool, hospital reimbursements and adjustments to medical assistance rates to enhanced safety net hospitals; and to amend chapter 474 of the laws of 1996 amending the education law and other laws relating to rates for residential health care facilities, in relation to extending the effectiveness of such rates   PURPOSE OR GENERAL IDEA OF BILL: Reform the distribution of indigent care pool (ICP) funds intended for hospitals that are serving a disproportionate share of individuals on Medicaid or uninsured.   SUMMARY OF SPECIFIC PROVISIONS:. Section 1 amends Public Health Law 2807-k, subdiv. 5d, to proportionate- ly reduce allocations to major public and voluntary hospitals by $300 million April 1, 2020 through December 31, 2020 (prorated accordingly), and annually thereafter. The bill eliminates the ICP transition method- ology, and the $25 million transition support for voluntary hospitals. These funds are distributed under other provisions of the bill. Section 2 of the bill adds a new Subdivision 23 to PHL 2807 to authorize adjustments to Medicaid rates for Enhanced Safety Net hospitals as defined in the PHL, and to a newly defined category of Qualified Safety Net hospitals. The new definition of Qualified Safety Net hospital is intended for hospitals that fall outside of the enhanced safety net definition, but provide significant indigent care, such as those that have received financial assistance through the existing VBPQIP/VAPAP programs and hospitals on the state's financial watch list. This section also requires the commissioner to increase Medicaid payments for inpa- tient and outpatient services by $37.7 million to major public general hospitals and $262.3 million to Enhanced Safety Net and Qualified Safety Net hospitals other than major public general hospitals. An additional $12.5 million is dedicated to federally designated critical access and sole community hospitals. This section increases rates/lump sum payments or using either VBP QIP or other supplemental programs to safety net hospitals (other than major public general hospitals) that lose funds compared to the current ICP distribution. Section 3 amends subdivision 1 of PHL 2807-c, which provides for hospi- tal inpatient Medicaid payment rates, to allow adjustments under the revised PHL 2807(23). Section 4 adds a new paragraph (d) to subdivision - of PHL 2807-c to make clear that payments to Enhanced Safety Net and Qualified Safety Net hospitals do not supplant other funding streams to Enhanced Safety Net hospitals. Sections 5 and 6 amend Chapter 474 of the Laws of 1996, to allow addi- tional $200 million in DSH payments to NYC Health + Hospitals, and addi- tional $100M DSH to all other major public hospitals, including those operated by the state, the State University of New York, or Erie, Nassau or Westchester counties.   JUSTIFICATION: This legislation is needed to fix inequities in distribution of ICP funds for hospitals serving low income and at-risk communities under the existing ICP funding and related Medicaid payments. The current law does not allocate 100% of the funds to those hospitals providing high levels of care to the uninsured or Medicaid enrollees. Approximately 15% of the funds, referred to as a "transition collar," still go to hospitals that are not providing significant care to the uninsured based on an old formula. This legislation would correct these inequities by eliminating the ICP transition collar without hurting hospitals providing services to low income and at risk communities; increasing Medicaid rates for safety net and qualified safety net hospitals; optimizing new federal Medicaid funds; and retaining all existing federal DSH funds to support these essential services. This legislation will rebalance the distribution of hospital indigent care funding, while staying within the constraints of the State's Medi- caid Global Cap and without additional financial impact to the State. The bill removes ICP funding linked to historic bad debt and better targets ICP funds to uninsured patient care. To address the Medicaid rate issue, the bill would invest $300 million of ICP funds into Medi- caid increases for enhanced and qualified safety net hospitals. The investment by hospital ownership type is proportional to the current pool funding with public shares of ICP at 12.6% and voluntary shares of the ICP at 87%. The bill builds on the Enhanced Safety Net Hospitals statute, and recog- nizes that additional hospitals are providing essential services to safety net communities and face serious financial jeopardy. Those hospi- tals are defined as qualified safety net hospitals and may be identified by criteria including having been awarded VAPAP or VBP QIP funds, or placed on the DOH Financially Distressed Watch List; the volume of Medi- caid or uninsured patients served; or the importance of the hospital in the hospital's region in providing services to Medicaid and uninsured patients. The bill would retain all existing federal DSH by allowing public hospitals access to $150 million federal DSH formerly used for ICP. The bill would increase Medicaid reimbursement rates for safety net and qualified safety net hospitals; dedicate funding for critical access hospitals and sole community hospitals; expand existing programs for financially distressed hospitals to ensure no harm to safety net or qualified safety net hospitals. Leveraging public hospitals' access to federal DSH will minimize federal DSH cuts to New York State which are set to begin in federal fiscal year 2020.   PRIOR LEGISLATIVE HISTORY: New bill   FISCAL IMPLICATIONS: No impact on state general fund or Medicaid global cap.   EFFECTIVE DATE: Immediately
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A06677 Text:



 
                STATE OF NEW YORK
        ________________________________________________________________________
 
                                         6677--B
 
                               2019-2020 Regular Sessions
 
                   IN ASSEMBLY
 
                                     March 15, 2019
                                       ___________
 
        Introduced by M. of A. GOTTFRIED, REYES, DICKENS, MOSLEY, WEPRIN, RODRI-
          GUEZ,  SANTABARBARA,  CRUZ,  BARRON, NIOU, CRESPO, PAULIN -- read once
          and referred to the Committee on Health -- committee discharged,  bill
          amended,  ordered reprinted as amended and recommitted to said commit-
          tee -- recommitted to the  Committee  on  Health  in  accordance  with
          Assembly Rule 3, sec. 2 -- committee discharged, bill amended, ordered
          reprinted as amended and recommitted to said committee
 
        AN ACT to amend the public health law, in relation to the general hospi-
          tal  indigent  care  pool,  hospital reimbursements and adjustments to
          medical assistance rates to enhanced  safety  net  hospitals;  and  to
          amend  chapter  474 of the laws of 1996 amending the education law and
          other laws relating to rates for residential health  care  facilities,
          in relation to extending the effectiveness of such rates
 
          The  People of the State of New York, represented in Senate and Assem-
        bly, do enact as follows:
 
     1    Section 1. Subdivision 5-d of section 2807-k of the public health law,
     2  as amended by section 6 of part H of chapter 57 of the laws of 2019,  is
     3  amended to read as follows:
     4    5-d.  (a)  Notwithstanding any inconsistent provision of this section,
     5  section twenty-eight hundred  seven-w  of  this  article  or  any  other
     6  contrary  provision  of  law, and subject to the availability of federal
     7  financial participation, for periods [on and after January] April first,
     8  two thousand [thirteen,] twenty through [March]  December  thirty-first,
     9  two  thousand twenty and each calendar year thereafter, all funds avail-
    10  able for distribution  pursuant  to  this  section,  [except  for  funds
    11  distributed pursuant to subparagraph (v) of paragraph (b) of subdivision
    12  five-b of this section,] and all funds available for distribution pursu-
    13  ant  to  section  twenty-eight hundred seven-w of this article, shall be
    14  reserved and set aside and distributed in accordance with the provisions
    15  of this subdivision.
 
         EXPLANATION--Matter in italics (underscored) is new; matter in brackets
                              [ ] is old law to be omitted.
                                                                   LBD10355-05-0

        A. 6677--B                          2
 
     1    (b) The commissioner shall promulgate regulations, and may  promulgate
     2  emergency  regulations,  establishing methodologies for the distribution
     3  of funds as described in paragraph (a)  of  this  subdivision  and  such
     4  regulations shall include, but not be limited to, the following:
     5    (i)  Such  regulations  shall  establish methodologies for determining
     6  each facility's relative uncompensated care need amount based  on  unin-
     7  sured  inpatient and outpatient units of service from the cost reporting
     8  year two years prior to the distribution year, multiplied by the  appli-
     9  cable  medicaid  rates in effect January first of the distribution year,
    10  as summed and adjusted by a statewide cost adjustment factor and reduced
    11  by the  sum  of  all  payment  amounts  collected  from  such  uninsured
    12  patients,  and  as  further  adjusted  by  application of a nominal need
    13  computation that shall take into account each facility's medicaid  inpa-
    14  tient share.
    15    (ii)  Annual  distributions  pursuant to such regulations for [the two
    16  thousand thirteen through  two  thousand  twenty  calendar  years]  each
    17  calendar year beginning with the two thousand twenty calendar year shall
    18  be in accord with the following:
    19    (A)  [one  hundred  thirty-nine million four hundred thousand dollars]
    20  one hundred one million seven hundred thousand dollars for each calendar
    21  year (prorated, as may be necessary, to reflect any period less  than  a
    22  year)  shall  be distributed as Medicaid Disproportionate Share Hospital
    23  ("DSH") payments to major public general hospitals; and
    24    (B) [nine hundred ninety-four million nine hundred  thousand  dollars]
    25  seven hundred seven million six hundred thousand dollars for each calen-
    26  dar year (prorated, as may be necessary, to reflect any period less than
    27  a  year)  as  Medicaid DSH payments to eligible general hospitals, other
    28  than major public general hospitals.
    29    (iii)[(A) Such regulations shall establish transition  adjustments  to
    30  the  distributions  made pursuant to clauses (A) and (B) of subparagraph
    31  (ii) of this paragraph such that no facility experiences a reduction  in
    32  indigent care pool payments pursuant to this subdivision that is greater
    33  than the percentages, as specified in clause (C) of this subparagraph as
    34  compared  to  the  average distribution that each such facility received
    35  for the three calendar years prior to two thousand thirteen pursuant  to
    36  this section and section twenty-eight hundred seven-w of this article.
    37    (B)  Such  regulations  shall  also establish adjustments limiting the
    38  increases in indigent  care  pool  payments  experienced  by  facilities
    39  pursuant to this subdivision by an amount that will be, as determined by
    40  the  commissioner  and  in conjunction with such other funding as may be
    41  available for this purpose, sufficient to ensure full  funding  for  the
    42  transition adjustment payments authorized by clause (A) of this subpara-
    43  graph.
    44    (C)  No  facility  shall  experience a reduction in indigent care pool
    45  payments pursuant to this subdivision that: for the calendar year begin-
    46  ning January first, two thousand thirteen, is greater than two and  one-
    47  half  percent;  for the calendar year beginning January first, two thou-
    48  sand fourteen, is greater than five percent; and, for the calendar  year
    49  beginning  on January first, two thousand fifteen; is greater than seven
    50  and one-half percent, and for the calendar  year  beginning  on  January
    51  first,  two  thousand  sixteen, is greater than ten percent; and for the
    52  calendar year beginning on January first,  two  thousand  seventeen,  is
    53  greater  than  twelve  and  one-half  percent; and for the calendar year
    54  beginning on January first,  two  thousand  eighteen,  is  greater  than
    55  fifteen  percent;  and for the calendar year beginning on January first,
    56  two thousand nineteen, is greater than seventeen and  one-half  percent;

        A. 6677--B                          3

     1  and for the calendar year beginning on January first, two thousand twen-
     2  ty, is greater than twenty percent.
     3    (iv)]  Such  regulations shall reserve one percent of the funds avail-
     4  able for distribution in the two  thousand  fourteen  and  two  thousand
     5  fifteen  calendar  years, and for calendar years thereafter, pursuant to
     6  this subdivision, subdivision fourteen-f of section twenty-eight hundred
     7  seven-c of this article, and sections two hundred eleven and two hundred
     8  twelve of chapter four hundred seventy-four  of  the  laws  of  nineteen
     9  hundred  ninety-six,  in  a  "financial  assistance compliance pool" and
    10  shall establish methodologies for the distribution of such pool funds to
    11  facilities based on their level of  compliance,  as  determined  by  the
    12  commissioner, with the provisions of subdivision nine-a of this section.
    13    (c)  The  commissioner  shall  annually report to the governor and the
    14  legislature on the distribution of funds under this subdivision  includ-
    15  ing, but not limited to:
    16    (i) the impact on safety net providers, including community providers,
    17  rural general hospitals and major public general hospitals;
    18    (ii)  the  provision  of  indigent care by units of services and funds
    19  distributed by general hospitals; and
    20    (iii) the extent to which access to care has been enhanced.
    21    § 2. Section 2807 of the public health law is amended by adding a  new
    22  subdivision 23 to read follows:
    23    23.  Adjustments to medicaid rates. (a) The commissioner is authorized
    24  to make adjustments to medical assistance rates in accordance with  this
    25  subdivision  to  enhanced  safety net hospitals, as defined in paragraph
    26  (a) of subdivision thirty-four of section twenty-eight  hundred  seven-c
    27  of  this  article,  and to qualified safety net hospitals, as defined in
    28  paragraph (b) of this subdivision, for the purposes of supporting  crit-
    29  ically  needed  health care services and to ensure the continued mainte-
    30  nance and operation of such hospitals.
    31    (b) For the purposes of this subdivision,  a  "qualified  safety  net"
    32  hospital shall mean a hospital, other than an enhanced safety net hospi-
    33  tal, so designated by the commissioner pursuant to criteria developed by
    34  the  commissioner  that  take into account: (i) the hospital's financial
    35  hardship, evidenced by the operating  losses  of  the  hospital  or  the
    36  system  of  hospitals to which the hospital belongs and/or participation
    37  by the hospital in programs established by the  commissioner  to  enable
    38  hospitals  in  financial  distress  to  maintain  operations  and  vital
    39  services;  (ii)  the  volume  of  Medicaid  and/or  medically  uninsured
    40  patients  served  by  the  hospital  compared  to other hospitals in the
    41  hospital's region; and/or (iii) the importance of the  hospital  in  the
    42  hospital's  region  in  enabling  Medicaid  and/or  medically  uninsured
    43  patients' access to health care services in  inpatient,  outpatient  and
    44  community settings.
    45    (c)  For  the  state  fiscal year commencing April first, two thousand
    46  twenty, and each state fiscal year thereafter,  the  commissioner  shall
    47  increase  medical  assistance  rates  of  payments  for inpatient and/or
    48  outpatient services made by either state governmental agencies or organ-
    49  izations operating in accordance with article forty-three of the  insur-
    50  ance law or article forty-four of this chapter by an aggregate of:
    51    (i)  thirty-seven  million seven hundred thousand dollars for enhanced
    52  safety net hospitals that are major public general hospitals;
    53    (ii) two hundred seventy-four million eight hundred  thousand  dollars
    54  for  qualified  safety  net  hospitals and enhanced safety net hospitals
    55  other than major public general hospitals,  of  which  at  least  twelve
    56  million  five  hundred  thousand  dollars shall be allocated to enhanced

        A. 6677--B                          4
 
     1  safety net hospitals that are federally designated as critical access or
     2  sole community hospitals; and
     3    (iii) twelve million five hundred thousand dollars for those hospitals
     4  eligible  under  subparagraph  (ii)  of  this  paragraph  for  which the
     5  combined payments made, or to be made, under subparagraph (ii)  of  this
     6  paragraph and subdivision five-d of section twenty-eight hundred seven-k
     7  of this article for calendar year two thousand twenty, and each calendar
     8  year  thereafter,  are  projected  by  the  commissioner to be less than
     9  payments made to  such  hospitals  pursuant  to  subdivision  five-d  of
    10  section  twenty-eight  hundred seven-k of this article for calendar year
    11  two thousand eighteen.
    12    (d) Payments made pursuant to this subdivision may be added  to  rates
    13  of  payment,  or  made as aggregate payments of equal amounts on October
    14  one and April one of each state fiscal year, to such enhanced safety net
    15  hospitals and qualified safety net hospitals in accordance with a  meth-
    16  odology  to be established by the commissioner; provided, however, that,
    17  the commissioner may make  the  twelve  million  five  hundred  thousand
    18  dollars  in  payments due to eligible hospitals under subparagraph (iii)
    19  of paragraph (c) of this subdivision by instead  increasing  the  amount
    20  otherwise  awarded to such eligible hospitals under programs established
    21  by the commissioner to enable hospitals in financial distress  to  main-
    22  tain  operations and vital services while working to achieve longer-term
    23  sustainability, including, but not limited to, the Value  Based  Payment
    24  Quality Improvement Program.
    25    §  3.  Subparagraph  (v)  of paragraph (a) of subdivision 1 of section
    26  2807-c of the public health law, as amended by chapter 639 of  the  laws
    27  of  1996,  is  amended  and  a new subparagraph (vi) is added to read as
    28  follows:
    29    (v) adjustments for any modifications to the case payments  determined
    30  in accordance with paragraph (a), (b), (c) or (d) of subdivision four of
    31  this section[.]; and
    32    (vi) adjustments for any modifications to the case payments determined
    33  in  accordance  with  subdivision  twenty-three  of section twenty-eight
    34  hundred seven of this article.
    35    § 4. Subparagraph (v) of paragraph (a) of  subdivision  1  of  section
    36  2807-c  of  the public health law, as amended by chapter 731 of the laws
    37  of 1993, is amended and a new subparagraph (vi)  is  added  to  read  as
    38  follows:
    39    (v)  adjustments for any modifications to the case payments determined
    40  in accordance with paragraph (a), (b), (c) or (d) of subdivision four of
    41  this section[.]; and
    42    (vi) adjustments for any modifications to the case payments determined
    43  in accordance with  subdivision  twenty-three  of  section  twenty-eight
    44  hundred seven of this article.
    45    §  5.  Subdivision  34  of  section 2807-c of the public health law is
    46  amended by adding a new paragraph (d) to read as follows:
    47    (d) Notwithstanding any inconsistent provision of law or regulation to
    48  the contrary, adjustments made pursuant to this subdivision shall be  in
    49  addition to any adjustments made to medical assistance rates to enhanced
    50  safety  net  hospitals authorized by subdivision twenty-three of section
    51  twenty-eight hundred seven of this article.
    52    § 6. Subdivision 1 of section 211 of chapter 474 of the laws  of  1996
    53  amending the education law and other laws relating to rates for residen-
    54  tial  health care facilities is amended by adding a new paragraph (g) to
    55  read as follows:

        A. 6677--B                          5
 
     1    (g) Notwithstanding any inconsistent provision of law or regulation to
     2  the contrary, effective for the state fiscal  year  beginning  April  1,
     3  2020, and annually thereafter, the department of health is authorized to
     4  pay  public general hospitals, other than those operated by the state of
     5  New  York or the state university of New York, as defined in subdivision
     6  10 of section 2801 of the public health law, located in a  city  with  a
     7  population of over one million, additional payments for inpatient hospi-
     8  tal  services  of  200  million  dollars annually, as medical assistance
     9  pursuant to title 11 of  article  5  of  the  social  services  law  for
    10  patients eligible for federal financial participation under title XIX of
    11  the  federal  social  security  act,  pursuant to federal laws and regu-
    12  lations governing disproportionate share payments to hospitals, based on
    13  the relative share of each such non-state operated public general hospi-
    14  tal medical assistance and uninsured patient losses. The payments may be
    15  added to rates of payment or made as aggregate payments to  an  eligible
    16  public general hospital.
    17    §  7.  Subdivision 1 of section 212 of chapter 474 of the laws of 1996
    18  amending the education law and other laws relating to rates for residen-
    19  tial health care facilities, is amended by adding a new paragraph (c) to
    20  read as follows:
    21    (c) Notwithstanding any inconsistent provision of law or regulation to
    22  the contrary, effective for the state fiscal  year  beginning  April  1,
    23  2020, and annually thereafter, the department of health is authorized to
    24  pay  public  general  hospitals, as defined in subdivision 10 of section
    25  2801 of the public health law, operated by the state of New York or  the
    26  state  university  of New York or by a county, which shall not include a
    27  city with a population of over one million, of the state  of  New  York,
    28  and those public general hospitals located in the county of Westchester,
    29  the  county  of  Erie  or  the county of Nassau, additional payments for
    30  inpatient hospital services of 100 million dollars annually, as  medical
    31  assistance  payments  pursuant  to  title  11 of article 5 of the social
    32  services law for patients eligible for federal  financial  participation
    33  under  title XIX of the federal social security act, pursuant to federal
    34  laws and regulations governing disproportionate share payments to hospi-
    35  tals. The payments may be added to rates of payment or made as aggregate
    36  payments to an eligible public general hospital.
    37    § 8. This act shall take effect immediately;  provided  however,  that
    38  the  amendments made to paragraph (a) of subdivision 1 of section 2807-c
    39  of the public health law made by section three  of  this  act  shall  be
    40  subject to the expiration and reversion of such paragraph when upon such
    41  date the provisions of section four of this act shall take effect.
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