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S.B. 179

             1     

HOSPITAL TAX ASSESSMENT

             2     
2012 GENERAL SESSION

             3     
STATE OF UTAH

             4     
Chief Sponsor: Lyle W. Hillyard

             5     
House Sponsor: R. Curt Webb

             6     
             7      LONG TITLE
             8      General Description:
             9          This bill amends the Hospital Provider Assessment Act to adjust the calculation of the
             10      assessment.
             11      Highlighted Provisions:
             12          This bill:
             13          .    deletes outdated language;
             14          .    amends the calculation of the assessment; and
             15          .    deletes the requirement for an advisory board.
             16      Money Appropriated in this Bill:
             17          None
             18      Other Special Clauses:
             19          None
             20      Utah Code Sections Affected:
             21      AMENDS:
             22          26-36a-203, as last amended by Laws of Utah 2011, Chapter 297
             23          26-36a-205, as enacted by Laws of Utah 2010, Chapter 179
             24          26-36a-209, as enacted by Laws of Utah 2010, Chapter 179
             25     
             26      Be it enacted by the Legislature of the state of Utah:
             27          Section 1. Section 26-36a-203 is amended to read:


             28           26-36a-203. Calculation of assessment.
             29          (1) The division shall calculate the inpatient upper payment limit gap for hospitals for
             30      each state fiscal year.
             31          (2) (a) An annual assessment is payable on a quarterly basis for each hospital in an
             32      amount calculated at a uniform assessment rate for each hospital discharge, in accordance with
             33      this section.
             34          (b) The uniform assessment rate shall be determined using the total number of hospital
             35      discharges for assessed hospitals divided into the total non-federal portion of the upper
             36      payment limit gap.
             37          (c) Any quarterly changes to the uniform assessment rate shall be applied uniformly to
             38      all assessed hospitals.
             39          (d) (i) Except as provided in Subsection (2)(d)(ii), the annual uniform assessment rate
             40      may not generate more than the non-federal share of the annual upper payment limit gap for the
             41      fiscal year.
             42          [(ii) (A) For fiscal year 2010 the assessment may not generate more than the
             43      non-federal share of the annual upper payment limit gap for the fiscal year.]
             44          [(B) For fiscal year 2010-11 the department may generate an additional amount from
             45      the assessment imposed under Subsection (2)(d)(i) in the amount of $2,000,000 which shall be
             46      used by the department and the division as follows:]
             47          [(I) $1,000,000 to offset Medicaid mandatory expenditures; and]
             48          [(II) $1,000,000 to offset the reduction in hospital outpatient fees in the state program.]
             49          [(C)] (ii) For fiscal years 2011-12 and 2012-13 the department may generate an
             50      additional amount from the assessment imposed under Subsection (2)(d)(i) in the amount of
             51      $1,000,000 to offset Medicaid mandatory expenditures.
             52          (3) (a) For state fiscal years 2010 and 2011, discharges shall be determined using the
             53      data from each hospital's Medicare Cost Report contained in the Centers for Medicare and
             54      Medicaid Services' Healthcare Cost Report Information System file as of April 1, 2009, for
             55      hospital fiscal years ending between October 1, 2007, and September 30, 2008.
             56          (b) If a hospital's fiscal year Medicare Cost Report is not contained in the Centers for
             57      Medicare and Medicaid Services' Healthcare Cost Report Information System file dated March
             58      31, 2009:


             59          (i) the hospital shall submit to the division a copy of the hospital's Medicare Cost
             60      Report with a fiscal year end between October 1, 2007, and September 30, 2008; and
             61          (ii) the division shall determine the hospital's discharges from the information
             62      submitted under Subsection (3)(b)(i).
             63          (c) If a hospital started operations after the due date for a 2007 Medicare Cost Report:
             64          (i) the hospital shall submit to the division a copy of the hospital's most recent
             65      complete year Medicare Cost Report; and
             66          (ii) the division shall determine the hospital's discharges from the information
             67      submitted under Subsection (3)(c)(i).
             68          (d) If a hospital is not certified by the Medicare program and is not required to file a
             69      Medicare Cost Report:
             70          (i) the hospital shall submit to the division its applicable fiscal year discharges with
             71      supporting documentation;
             72          (ii) the division shall determine the hospital's discharges from the information
             73      submitted under Subsection (3)(d)(i); and
             74          (iii) the failure to submit discharge information under Subsections (3)(d)(i) and (ii)
             75      shall result in an audit of the hospital's records by the department and the imposition of a
             76      penalty equal to 5% of the calculated assessment.
             77          (4) (a) For state fiscal year 2012 and 2013, discharges shall be determined using the
             78      data from each hospital's Medicare Cost Report contained in the Centers for Medicare and
             79      Medicaid Services' Healthcare Cost Report Information System file as of:
             80          (i) for state fiscal year 2012, September 30, 2010, for hospital fiscal years ending
             81      between October 1, 2008, and September 30, 2009; and
             82          (ii) for state fiscal year 2013, September 30, 2011, for hospital fiscal years ending
             83      between October 1, 2009, and September 30, 2010.
             84          (b) If a hospital's fiscal year Medicare Cost Report is not contained in the Centers for
             85      Medicare and Medicaid Services' Healthcare Cost Report Information System file:
             86          (i) the hospital shall submit to the division a copy of the hospital's Medicare Cost
             87      Report applicable to the assessment year; and
             88          (ii) the division shall determine the hospital's discharges.
             89          (c) If a hospital is not certified by the Medicare program and is not required to file a


             90      Medicare Cost Report:
             91          (i) the hospital shall submit to the division its applicable fiscal year discharges with
             92      supporting documentation;
             93          (ii) the division shall determine the hospital's discharges from the information
             94      submitted under Subsection (4)(c)(i); and
             95          (iii) the failure to submit discharge information shall result in an audit of the hospital's
             96      records and a penalty equal to 5% of the calculated assessment.
             97          (5) Except as provided in Subsection (6), if a hospital is owned by an organization that
             98      owns more than one hospital in the state:
             99          (a) the assessment for each hospital shall be separately calculated by the department;
             100      and
             101          (b) each separate hospital shall pay the assessment imposed by this chapter.
             102          (6) Notwithstanding the requirement of Subsection (5), if multiple hospitals use the
             103      same Medicaid provider number:
             104          (a) the department shall calculate the assessment in the aggregate for the hospitals
             105      using the same Medicaid provider number; and
             106          (b) the hospitals may pay the assessment in the aggregate.
             107          (7) (a) The assessment formula imposed by this section, and the inpatient access
             108      payments under Section 26-36a-205 , shall be adjusted in accordance with Subsection (7)(b) if a
             109      hospital, for any reason, does not meet the definition of a hospital subject to the assessment
             110      under Section 26-36a-103 for the entire fiscal year.
             111          (b) The department shall adjust the assessment payable to the department under this
             112      chapter for a hospital that is not subject to the assessment for an entire fiscal year by
             113      multiplying the annual assessment calculated under Subsection (3) or (4) by a fraction, the
             114      numerator of which is the number of days during the year that the hospital operated, and the
             115      denominator of which is 365.
             116          (c) A hospital described in Subsection (7)(a):
             117          (i) that is ceasing to operate in the state, shall pay any assessment owed to the
             118      department immediately upon ceasing to operate in the state; and
             119          (ii) shall receive Medicaid inpatient hospital access payments under Section
             120      26-36a-205 for the state fiscal year, adjusted using the same formula described in Subsection


             121      (7)(b).
             122          (8) A hospital that is subject to payment of the assessment at the beginning of a state
             123      fiscal year, but during the state fiscal year experiences a change in status so that it no longer
             124      falls under the definition of a hospital subject to the assessment in Section 26-36a-204 , shall:
             125          (a) not be required to pay the hospital assessment beginning on the date established by
             126      the department by administrative rule; and
             127          (b) not be entitled to Medicaid inpatient hospital access payments under Section
             128      26-36a-205 on the date established by the department by administrative rule.
             129          Section 2. Section 26-36a-205 is amended to read:
             130           26-36a-205. Medicaid hospital inpatient access payments.
             131          (1) To preserve and improve access to hospitals, the division shall make Medicaid
             132      inpatient hospital access payments to hospitals in accordance with this section, Section
             133      26-36a-204 , and Subsection 26-36a-203 (7).
             134          (2) (a) The Medicaid inpatient hospital access payment amount to a particular hospital
             135      shall be established by the division.
             136          (b) The aggregate of all hospital's Medicaid inpatient hospital access payments shall
             137      be:
             138          (i) equal to the upper payment limit gap for inpatient services for all hospitals; and
             139          (ii) designated as the Medicaid inpatient hospital access payment pool.
             140          (3) In addition to any other funds paid to hospitals during fiscal years 2010 and 2011
             141      for inpatient hospital services to Medicaid patients, a Medicaid hospital inpatient access
             142      payment shall be made:
             143          (a) for state fiscal years 2010 and 2011:
             144          (i) the amount of $825 per Medicaid fee for service day, to a hospital that:
             145          (A) was not a specialty hospital; and
             146          (B) had less than 300 select access inpatient cases during state fiscal year 2008; and
             147          (ii) inpatient hospital access payments as determined by dividing the remaining
             148      spending room available in the current year UPL, after offsetting the payments authorized
             149      under Subsection (3)(a)(i) by the total 2008 Medicaid inpatient hospital payments, multiplied
             150      by the hospital's Medicaid inpatient payments for state fiscal year 2008, exclusive of medical
             151      education and Medicaid disproportionate share payments;


             152          (b) for state fiscal year 2012[, using state fiscal year 2009 paid Medicaid inpatient
             153      claims data; and]:
             154          (i) the amount of $825 per Medicaid fee for service day, to a hospital that:
             155          (A) is not a specialty hospital; and
             156          (B) has less than 300 select access inpatient cases during the state fiscal year 2008; and
             157          (ii) inpatient hospital access payments as determined by dividing the remaining
             158      spending room available in the current year upper payment limit, after offsetting the payments
             159      authorized under Subsection (3)(a)(i), by the total 2009 Medicaid inpatient hospital payments,
             160      multiplied by the hospital's Medicaid inpatient payments for state fiscal year 2009, exclusive of
             161      medical education and Medicaid disproportionate share payments; and
             162          (c) for state fiscal year 2013[, using state fiscal year 2010 paid Medicaid inpatient
             163      claims data.]:
             164          (i) the amount of $825 per Medicaid fee for service day, to a hospital that:
             165          (A) is not a specialty hospital; and
             166          (B) has less than 300 select access inpatient cases during the state fiscal year 2008; and
             167          (ii) inpatient hospital access payments as determined by dividing the remaining
             168      spending room available in the current year upper payment limit, after offsetting the payments
             169      authorized under Subsection (3)(a)(i), by the total 2010 Medicaid inpatient hospital payments,
             170      multiplied by the hospital's Medicaid inpatient payments for state fiscal year 2010, exclusive of
             171      medical education and Medicaid disproportionate share payments.
             172          [(4) For both state fiscal years 2012 and 2013, the division shall submit adjustments to
             173      the payment rates in Subsection (3)(a) to the Hospital Policy Review Board for their review.]
             174          [(5)] (4) Medicaid inpatient hospital access payments shall be made:
             175          (a) on a quarterly basis for inpatient hospital services furnished to Medicaid individuals
             176      during each quarter; and
             177          (b) within 15 days after the end of each quarter.
             178          [(6)] (5) A hospital's Medicaid inpatient access payment shall not be used to offset any
             179      other payment by Medicaid for hospital inpatient or outpatient services to Medicaid
             180      beneficiaries, including a:
             181          (a) fee-for-service payment;
             182          (b) per diem payment;


             183          (c) hospital inpatient adjustment; or
             184          (d) cost settlement payment.
             185          (6) When the division obtains approval from the Centers for Medicare and Medicaid
             186      Services for the Medicaid Waiver - Accountable Care Organizations, and has determined the
             187      capitated rate for the accountable care organizations, the department shall consult with the Utah
             188      Hospitals Association to develop an alternative supplemental payment methodology that can be
             189      approved by the Centers for Medicare and Medicaid Services.
             190          (7) A hospital shall not be guaranteed that the hospital's Medicaid inpatient hospital
             191      access payments will equal or exceed the amount of the hospital's assessment.
             192          Section 3. Section 26-36a-209 is amended to read:
             193           26-36a-209. State plan amendment.
             194          (1) The division shall file with the Center for Medicare and Medicaid Services a state
             195      plan amendment to implement the requirements of this chapter, including the payment of
             196      hospital access payments under Section 26-36a-205 no later than 45 days after the effective
             197      date of this chapter.
             198          (2) If the state plan amendment is not approved by the Center for Medicare and
             199      Medicaid Services, the division shall:
             200          (a) not implement the assessment imposed under this chapter; and
             201          (b) return any assessment fees to the hospitals that paid the fees if assessment fees have
             202      been collected.
             203          [(3) (a) The department shall establish an advisory board that is the Hospital Policy
             204      Review Board.]
             205          [(b) The board shall have five members selected as follows:]
             206          [(i) one member appointed by the governor from a list of names submitted by the Utah
             207      Hospitals and Health Systems Association;]
             208          [(ii) two members appointed by the president of the Senate from a list of names
             209      submitted by the Utah Hospitals and Health Systems Association; and]
             210          [(iii) two members appointed by the speaker of the House from a list of names
             211      submitted by the Utah Hospitals and Health Systems Association.]
             212          [(c) Members of the board may not be compensated for their services on the board or
             213      receive reimbursement for costs or per diem expenses.]


             214          [(d) If a selection is not made by the governor, the speaker of the House, or the
             215      president of the Senate within 60 days after the names are submitted by the Utah Hospitals and
             216      Health Systems Association, the member shall be appointed by the Utah Hospitals and Health
             217      Systems Association.]
             218          [(e) (i) The board shall review state Medicaid plan amendments or waivers affecting
             219      hospital reimbursement between the date of enactment of this chapter and the end of state fiscal
             220      year 2013.]
             221          [(ii) A majority of the board is a quorum.]
             222          [(f) The department may not amend the state Medicaid plan or any waiver affecting
             223      hospital reimbursement without submitting the amendment or waiver to the board for review.]




Legislative Review Note
    as of 2-13-12 1:46 PM


Office of Legislative Research and General Counsel


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