Amendment #866 to H4600

Hospital Assessment

Mr. Lawn of Watertown moves to amend the bill by inserting, after section 30, the following section:-

SECTION 30A. Said chapter 29 is hereby amended by striking out section 2PPP and inserting in place thereof the following section:-

Section 2PPP. There shall be established and set up on the books of the commonwealth a separate, non-budgeted special revenue fund known as the Essential Community Provider Trust Fund, in this section called the trust fund. There shall be credited to the trust fund: (i) any funds that may be appropriated or transferred into the trust fund; and (ii) any income derived from investment of amounts credited to the trust fund. In conjunction with the preparation of the commonwealth’s annual financial report, the comptroller shall prepare and issue an annual report detailing the revenues and expenditures of the trust fund. Amounts credited to the fund shall not be subject to further appropriation. Money remaining in the fund at the end of a fiscal year shall not revert to the General Fund and shall be available for expenditure in subsequent fiscal years. To accommodate timing discrepancies between the receipt of revenue and related expenditures, the comptroller may certify for payment amounts not to exceed the most recent revenue estimates as certified by the secretary of health and human services to be transferred, credited or deposited to the trust fund. The secretary of health and human services shall administer the trust fund and disburse funds from the trust fund to make payments to acute hospitals and community health centers to maintain financial stability for the provision of healthcare services in the commonwealth, to ensure access to care, provide for public health and promote equity.

And further amend the bill, in section 31, by striking out the words “subsection (c)”, in line 480, and inserting in place thereof the following words:- subsections (c) and (d).

And further amend the bill, in said section 31, by striking out paragraphs (2) and (3) and inserting in place thereof the following 2 paragraphs:-

(2) The secretary shall annually expend amounts from the fund averaging, for the 3-year period from October 1, 2024 through September 30, 2027, not less than $2,158,500,000 per year; provided, however, that all such payments shall fall into 1 of the following categories: (i) health equity incentive payments; (ii) clinical quality incentive payments; (iii) other incentive payments; (iv) rate payments for services provided to MassHealth members; or (v) targeted payments to: (A) freestanding pediatric acute hospitals; (B) nonprofit teaching acute hospitals that provide medical, surgical, emergency and obstetrical services and are affiliated with a state-owned medical school; (C) freestanding cancer hospitals; (D) the acute hospital with the lowest statewide commercial relative price in fiscal year 2019 as reported by the center for health information and analysis; or (E) the independent group 1 safety net hospital with the largest percentile of operating loss in fiscal year 2022 as reported by the center for health information and analysis. The secretary may determine funding allocations among and within each such category within a given year; provided, however, that such allocations shall be consistent with all approved federal waivers and state plan provisions; and provided further, that the secretary shall allocate an average of not less than $1,192,000,000 per year, for the 3-year period from October 1, 2024 through September 30, 2027, for the rate payments described in clause (iv), with an average of not less than $92,000,000 allocated for group 1 safety net hospitals for the 3-year period, an average of not less than $460,000,000 allocated for group 2 safety net hospitals for the 3-year period, and an average of not less than $640,000,000 allocated across all acute hospitals for the 3-year period.

(3) Of the targeted payments described in clause (v) of paragraph (2), the secretary shall expend annually from the fund: (i) $75,000,000 to freestanding pediatric acute hospitals, of which at least 98 per cent shall be paid to the freestanding pediatric hospital with the largest volume of inpatient discharges in fiscal year 2019; (ii) $35,000,000 to nonprofit teaching acute hospitals that provide medical, surgical, emergency and obstetrical services and are affiliated with a state-owned medical school; (iii) $11,000,000 to the acute hospital with the lowest statewide commercial relative price in fiscal year 2019 as reported by the center for health information and analysis; (iv) $5,000,000 to the freestanding cancer hospitals; and (v) $10,000,000 to the independent group 1 safety net hospital with the largest operating percentile loss in fiscal year 2022 as reported by the center for health information and analysis.

And further amend the bill, in said section 31, by adding the following subsection:-

(d) If any portion of the final annual amount allocated by the secretary to health equity incentive payments or clinical quality incentive payments or other incentive payments is unearned during the relevant measurement period for such payment, as determined by the secretary, the secretary shall transfer the state’s share of that unearned amount to the Health Safety Net Trust Fund established in section 66 of chapter 118E.

And further amend the bill, in section 37, by inserting after the word “waiver”, in line 599, the following words:- or for the administration of the assessment established in section 68 of chapter 118E.

And further amend the bill, in said section 37, by inserting after the word “all,” in line 599, the following word:- Medicaid.

And further amend the bill by striking out section 53 and inserting in place thereof the following section:-

SECTION 53. Said section 64 of said chapter 118E, as so appearing, is hereby further amended by inserting after the definition of “Gross patient service revenue” the following 3 definitions:-

“Group 1 safety net hospital”, any hospital identified as a group 1 safety net hospital in the MassHealth demonstration waiver approved September 28, 2022, effective October 1, 2022 through December 31, 2027, pursuant to subsection (a) of section 1115 of Title XI of the federal Social Security Act.

“Group 2 safety net hospital”, any hospital identified as a group 2 safety net hospital in the MassHealth demonstration waiver approved September 28, 2022, effective October 1, 2022 through December 31, 2027, pursuant to subsection (a) of section 1115 of Title XI of the federal Social Security Act.

“Health policy commission revenue amount”, the amount collected by the health policy commission from hospitals and ambulatory surgical centers pursuant to section 6 of chapter 6D.

And further amend the bill, in section 54, by striking out the figure “7”, in line 899, and inserting in place thereof the following figure:- 8.

And further amend the bill, in said section 54, by inserting after the definition of “Medicaid managed care organization”, the following definition:-

“Medicaid managed care organization services subject to assessment”, managed care organization services subject to assessment provided to a Medicaid member.

And further amend the bill, in section 56, by striking out the figure “1,226,715,133”, in line 943, and inserting in place thereof the following figure:- 1,484,050,000.

And further amend the bill, in section 58, by striking out the figure “791,915,133”, in line 960, and inserting in place thereof the following figure:- 994,000,000.

And further amend the bill, in said section 58, by striking out the words “and (D) $10,000,000 to the Non-Acute Care Hospital Reimbursement Trust Fund established in section 2WWWW of said chapter 29”, in lines 963 and 964, and inserting in place thereof the following words:- (D) $30,250,000 to the Non-Acute Care hospital Reimbursement Trust Fund established in section 2WWWW of said chapter 29; and (E) $35,000,000 to the Essential Community Provider Trust Fund established in section 2PPP of said chapter 29.

And further amend the bill, in section 59, by striking out the figure “$791,915,133”, in line 988, and inserting in place thereof the following figure:- $994,000,000.

And further amend the bill, in said section 59, by striking out the figure “$10,000,000”, in line 991, and inserting in place thereof the following figure:- $30,250,000.

And further amend the bill, in said section 59, by striking out the words “and (J) an amount equal to the center for health information and analysis revenue amount to the Center for Health Information and Analysis Fund established in section 7A of chapter 12C”, in lines 1000 to 1002, inclusive, and inserting in place thereof the following words:- (J) an amount equal to the center for health information and analysis revenue amount to the Center for Health Information and Analysis Fund established in section 7A of chapter 12C; and (K) $35,000,000 to the Essential Community Provider Trust Fund established in section 2PPP of chapter 29.

And further amend the bill, in section 61, by striking out subsections (d) and (e), in lines 1090 to 1131, inclusive, and inserting in place thereof the following 2 subsections:-

(d) For the purposes of the assessment described in this section, all hospitals in the commonwealth shall be divided into the following groups, as determined by the secretary of health and human services:

(i) large group 1 safety net hospitals, defined for the purposes of this section as any group 1 safety net hospital with 355 or more staffed beds in fiscal year 2022, as reported by the center for health information and analysis;

(ii) small group 1 safety net hospitals, defined for the purposes of this section as any group 1 safety net hospital identified with less than 355 staffed beds in fiscal year 2022, as reported by the center for health information and analysis;

(iii) large group 2 safety net hospitals, defined for the purposes of this section as any group 2 safety net hospitals with 355 or more staffed beds in fiscal year 2022, as reported by the center for health information and analysis;

(iv) small group 2 safety net hospitals, defined for the purposes of this section as any group 2 safety net hospitals with less than 355 staffed beds in fiscal year 2022, as reported by the center for health information and analysis;

(v) freestanding pediatric acute hospitals;

(vi) academic, teaching and specialty hospitals, defined for the purposes of this section as any academic medical center, teaching hospital or specialty hospital, as determined by the center for health information and analysis as of September 30, 2019, but excluding any high public payer hospital;

(vii) private acute hospitals, defined for the purposes of this section as any private hospital licensed under section 51 of chapter 111 and that contains a majority of medical-surgical, pediatric, obstetric and maternity beds, as defined by the department of public health, and operating as of September 30, 2019, but excluding any safety net hospital or academic, teaching and specialty hospital;

(viii) non-state public hospitals, defined for the purposes of this section as any non-state-owned public hospital in the commonwealth, as determined by the secretary of health and human services; and

(ix) non-acute hospitals, defined for the purposes of this section as any nonpublic hospital licensed by the department of public health under section 51 of chapter 111 but not defined as an acute care hospital under section 25B of chapter 111 or any nonpublic hospital licensed as an inpatient facility by the department of mental health under section 19 of chapter 19 and any regulations promulgated thereunder but not categorized as a class VII licensee under any regulations.

(e) Each of the groups described in subsection (d) shall be subject to the following assessment rates: (i) large group 1 safety net hospitals shall be subject to a rate of 24.000 per cent for inpatient services and 5.950 per cent for outpatient services; (ii) small group 1 safety net hospitals shall be subject to a rate of 14.500 per cent for inpatient services and 5.500 per cent for outpatient services; (iii) large group 2 safety net hospitals shall be subject to a rate of 18.000 per cent for inpatient services and 18.200 per cent for outpatient services; (iv) small group 2 safety net hospitals shall be subject to a rate of 18.000 per cent for inpatient services and 10.200 per cent for outpatient services; (v) freestanding pediatric hospitals shall be subject to a rate of 4.800 per cent for inpatient services and 4.250 per cent for outpatient services; (vi) academic, teaching and specialty hospitals shall be subject to a rate of 4.701 per cent for inpatient services and 1.065 per cent for outpatient services; (vii) private acute hospitals shall be subject to a rate of 8.500 per cent for inpatient services and 1.045 per cent for outpatient services; (viii) non-state public hospitals shall be subject to a rate of 1.615 per cent for inpatient services and 1.500 per cent for outpatient services; and (ix) non-acute hospitals shall be subject to a rate of 3.300 per cent for inpatient services and 3.300 per cent for outpatient services; provided, however, that the office shall increase each such rate by the amount necessary to generate 50 per cent of the estimated cost, as determined by the secretary of administration and finance, of administering the health safety net and related assessments in accordance with sections 65 to 69, inclusive. In the event that a hospital closure or a hospital change in status to a different type of provider results in a reduction of the total hospital assessment amount, the secretary of health and human services may, through regulation, adjust the assessment rates to ensure the total hospital assessment amount is not reduced by more than $10,000,000 on an annual basis; provided, that any such adjustments to the rates shall ensure the rates remain in the same proportion to each other as established in this subsection.

And further amend the bill, in said section 61, by adding the following subsection:-

(h) The secretary of health and human services may enforce the payment of assessments required pursuant to this section by: (i), notifying the department of public health of any unpaid assessments regarding hospitals licensed by the department of health, and such information shall be considered by the department of public health in determining suitability, in accordance with section 51 of chapter 111, for the hospital or its affiliate provider entities; (ii) offsetting payments from the office of Medicaid against the claims for payment by the delinquent hospital, against other hospitals or MassHealth contracted entities under common ownership as the delinquent hospital or against any successor in interest to the hospital or such provider entities under common ownership, in the amount of the delinquent fees owed, including any interest, penalties or reasonable attorneys’ fees, and by transferring such funds into the fund; or (iii) creating, after demand for payment, a lien in favor of the commonwealth in an amount not to exceed the delinquent fees owed, including any interest, penalties or reasonable attorneys’ fees, encumbering the building in which the delinquent hospital is located, the real property upon which the delinquent hospital is located, any fixtures, equipment or goods used in the operation of the delinquent hospital or any real property in which the delinquent hospital holds an interest.

And further amend the bill, in section 62, by striking out, clauses (i) through (iii), inclusive, of subsection (c), in lines 1162 through 1170, inclusive, and inserting in place there of the following 3 clauses:-

(i) managed care organization services subject to assessment that are not Medicaid managed care organization services subject to assessment provided by a managed care organization;

(ii) Medicaid managed care organization services subject to assessment provided by a managed care organization that has an average total Medicaid member per month enrollment below a threshold established by the secretary of health and human services through regulations; and

(iii) Medicaid managed care organization services subject to assessment provided by a managed care organization that has an average total Medicaid member per month enrollment at or above a threshold established by the secretary of health and human services through regulations.

And further amend the bill, in section 85, by inserting after the word “sections”, in lines 1581 and 1584, in each instance, the following figure:- 30A.

And further amend the bill, in section 86, by inserting after the word “sections”, in lines 1607, 1610 and 1614, in each instance, the following figure:- 30A.

And further amend the bill, in section 104, by inserting after the word “Sections”, in line 1794, the following figure:- 30A.

Additional co-sponsor(s) added to Amendment #866 to H4600

Hospital Assessment