HB 183 — AN ACT relating to the hospital rate improvement program, making an appropriation therefor, and declaring an emergency.

UNOFFICIALCHAPTER COPY60 211 RSCHAPTER 60 ( HB 183/GA183 ) AN ACT relating to the hospital rate improvement program, making an appropriation therefor, and declaring an emergency.

(8) "Managed care gap" means the difference between the maximum actuarially sound amount that can be included in managed care rates for hospital inpatient services provided by qualifying hospitals and out-of-state hospitals and the amount of total payments for hospital inpatient services provided by qualifying hospitals and out-of-out-of-state state hospitals paid by managed care organizations.

For purposes of the managed Page 1 of 9 HB018310.100 - 967 - XXXX GA UNOFFICIAL COPY 21 RS HB 183/GA care gap, total payments shall include only those supplemental payments made to a qualifying hospital and shall exclude payments established under KRS 205.6405 to 205.6408;

(10) "Non-state government-owned hospital" means the same as non-state government-government-owned owned or operated facilities in 42 C.F.R.

Legislative Research Commission PDF Version ACTS OF THE GENERAL ASSEMBLY (c) Provides at least twenty percent (20%) of inpatient care to Medicaid-eligible recipients as reflected in the department's hospital rate data for state fiscal year 1998-1999;

and (d) Provides at least five thousand (5,000) days of inpatient psychiatric care to Page 2 of 9 HB018310.100 - 967 - XXXX GA UNOFFICIAL COPY 21 RS HB 183/GA Medicaid recipients in a state fiscal year;

(17) "Qualifying hospital disproportionate share percentage" means a percentage equal to the amount of hospital provider taxes paid pursuant to KRS 142.303 by qualifying hospitals in state fiscal year 2016-2017 divided by the amount of hospital provider taxes paid pursuant to KRS 142.303 by all hospitals in state fiscal year 2016-2017;2016- 2017;

and (20) "UPL gap" means the difference between the UPL and amount of total fee-for-fee-for-service service payments paid by the department for hospital inpatient services provided by non-state government-owned hospitals and private hospitals to Medicaid Page 3 of 9 HB018310.100 - 967 - XXXX GA UNOFFICIAL COPY 21 RS HB 183/GA beneficiaries and excluding payments established under KRS 205.6405 to 205.6408.

(a) A program to increase inpatient reimbursement to qualifying hospitals within the Medicaid fee-for-servicefee-for- service program in an aggregate amount equivalent to the UPL gap;

(c) A per discharge uniform add-on amount to be applied to Medicaid fee-for-fee-for-service service discharges at qualifying hospitals for that program year, determined by dividing the UPL gap for the applicable ownership group by total fee-for-fee-for-service service hospital inpatient discharges at qualifying hospitals in the data used to calculate the UPL gap.

Page 4 of 9 HB018310.100 - 967 - XXXX GA UNOFFICIAL COPY 21 RS HB 183/GA (d) The maximum managed care gap for inpatient services;

Claims for discharges that already receive an enhanced rate at qualifying CHAPTER 60 3 hospitals that also are classified as a pediatric teaching hospital or as a psychiatric access hospital shall be excluded from the calculation of the per discharge uniform add-on, unless the department is required to include these claims to obtain federal approval.

(a) Calculate a fee-for-service quarterly supplemental payment for each qualifying hospital using fee-for-servicefee-for- service claims for inpatient discharges paid in the quarter to the qualifying hospital multiplied by the uniform add-on amount determined in subsection (2)(c) of this section;

(d) Provide each managed care organization with a listing of the supplemental payments to be paid by each managed care organization to each qualifying Page 5 of 9 HB018310.100 - 967 - XXXX GA UNOFFICIAL COPY 21 RS HB 183/GA hospital;

(f) Determine the amount of state funds necessary to obtain federal matching funds that, in the aggregate, equal the total quarterly supplemental payments to be paid to all qualifying hospitals in both the fee-for-servicefee-for- service and the Medicaid managed care programs;

and (i) Provide each qualifying hospital with a notice sent on the same day as the distribution to managed care organizations of the supplemental capitation payments pursuant to paragraph (e) of this subsection, of the qualifying hospital's quarterly assessment, that shall state the total amount due from the assessment, the date payment is due, the total number of paid claims for inpatient discharges used to calculate the qualifying hospital's quarterly supplemental payments, and the amount of quarterly supplemental payments Page 6 of 9 HB018310.100 - 967 - XXXX GA UNOFFICIAL COPY 21 RS HB 183/GA due to be received by the qualifying hospital from the department and each Medicaid managed care organization.

Legislative Research Commission PDF Version ACTS OF THE GENERAL ASSEMBLY (8) The department shall complete the actions required under subsection (3) of this section expeditiously and within the same quarter as all required information is received.

If the department agrees that an error occurred in a qualifying hospital's quarterly supplemental payment, the department shall reconcile the Page 7 of 9 HB018310.100 - 967 - XXXX GA UNOFFICIAL COPY 21 RS HB 183/GA payment error through an adjustment in the qualifying hospital's next quarterly supplemental payment.

The department shall not establish Medicaid fee-fee-for-service for-service rate-setting methodology changes that result in rate reductions from policies in effect as of October 1, 2018, for acute care hospitals and July 1, 2019, for hospitals paid on a per diem basis.

(14) If the department submits, and the United States Centers for Medicare and Medicaid Services (CMS) approves, a supplemental payment formula that permits the managed care gap to be calculated based upon a percentage of average commercial rates (ACR) that results in a total annual supplemental payment Page 8 of 9 HB018310.100 - 967 - XXXX GA UNOFFICIAL COPY 21 RS HB 183/GA greater than eighty percent (80%) of ACR instead of the Medicare upper payment limit, then the Hospitalhospital Raterate Improvementimprovement Programprograms shall be modified as follows:

PageSigned 9by ofGovernor 9March HB018310.10022, -2021. 967 - XXXX GA