il-v50i43-89-ill-adm-code-148: 89 Ill. Adm. Code 148 — Hospital Services

1) Heading of the Part: Hospital Services 2) Code Citation: 89 Ill. Adm. Code 148 3) Section Numbers: Proposed Actions: 148.120 Amendment 148.122 Amendment 4) Statutory Authority: Implementing and authorized by Articles III, IV, V and VI and Section 12-13 of the Illinois Public Aid Code [305 ILCS 5]. 5) A Complete Description of the Subjects and Issues Involved: Pursuant to the FY 27 Medicaid Omnibus Bill, Public Act 104-0470, the proposed amendments to Rule 148 are as follows: Effective October 1, 2026, days of care funded by the U.S. Department of Veterans Affairs at certain hospitals are excluded from calculation of the Medicaid inpatient utilization rate. Effective October 1, 2026, days of care funded by the Department of Human Services for forensic mental health services are excluded from calculation of the Medicaid inpatient utilization rate. 6) Published studies or reports, and sources of underlying data, used to compose this rulemaking: None 7) Will this proposed rulemaking replace an emergency rule currently in effect? No 8) Does this rulemaking contain an automatic repeal date? No 9) Do these proposed amendments contain incorporations by reference? No 10) Are there any other proposed rulemakings pending on this Part? Yes Section Numbers: Proposed Actions: Illinois Register Citations: 148.423 Amendment 50 Ill. Reg. 5320; April 17, 2026 148.425 Amendment 50 Ill. Reg. 5320; April 17, 2026 148.402 Amendment 50 Ill. Reg. 13401; September 11, 2026 DEPARTMENT OF HEALTHCARE AND FAMILY SERVICES NOTICE OF PROPOSED AMENDMENTS 11) Statement of Statewide Policy Objectives: This rulemaking is not anticipated to create nor expand a State mandate on units of local government. 12) Time, Place, and Manner in which interested persons may comment on this proposed rulemaking: Any interested parties may submit comments, data, views, or arguments concerning this proposed rulemaking. All comments must be in writing and should be addressed to: Chris Gange Acting General Counsel Illinois Department of Healthcare and Family Services 201 South Grand Avenue East, 3 Floor Springfield IL 62763-0002 217-782-1233 HFS.Rules@illinois.gov The Department requests the submission of written comments within 45 days after the publication of this Notice. The Department will consider all written comments it receives during the first notice period as required by Section 5-40 of the Illinois Administrative Procedure Act [5 ILCS 100/5-40]. 13) Initial Regulatory Flexibility Analysis: A) Description of the type of small business, not for profit corporations or small municipalities subject to the proposed amendments: None B) Description of the proposed reporting, bookkeeping and other procedures required for compliance with the amendments: None C) Description of the types of professional skills necessary for compliance: None 14) Small Business Economic Impact Analysis: Rulemaking will not have any adverse impact on small business. 15) Regulatory Agenda on which this rulemaking was summarized: July 2026 16) Any other information or justification for the proposed rule or amendment that the agency believes would be helpful to the public regarding the proposed rule or DEPARTMENT OF HEALTHCARE AND FAMILY SERVICES NOTICE OF PROPOSED AMENDMENTS amendment. For example, a discussion or analysis of the benefits of the proposed rule or amendment is projected to have on the Illinois public, consumers, investors or other similar groups: None The full text of the Proposed Amendments begins on the next page: DEPARTMENT OF HEALTHCARE AND FAMILY SERVICES NOTICE OF PROPOSED AMENDMENTS TITLE 89: SOCIAL SERVICES CHAPTER I: DEPARTMENT OF HEALTHCARE AND FAMILY SERVICES SUBCHAPTER d: MEDICAL PROGRAMS PART 148 HOSPITAL SERVICES SUBPART A: GENERAL PROVISIONS Section 148.10 Hospital Services 148.20 Participation 148.25 Definitions and Applicability 148.30 General Requirements 148.40 Special Requirements 148.50 Covered Hospital Services 148.60 Services Not Covered as Hospital Services 148.70 Limitation On Hospital Services SUBPART B: REIMBURSEMENT AND RELATED PROVISIONS Section 148.80 Organ Transplants Services Covered Under Medicaid (Repealed) 148.82 Organ Transplant Services 148.85 Supplemental Tertiary Care Adjustment Payments (Repealed) 148.90 Medicaid Inpatient Utilization Rate (MIUR) Adjustment Payments (Repealed) 148.95 Medicaid Outpatient Utilization Rate (MOUR) Adjustment Payments (Repealed) 148.100 County Trauma Center Adjustment Payments 148.103 Outpatient Service Adjustment Payments (Repealed) 148.105 Reimbursement Methodologies for Inpatient Rehabilitation Services 148.110 Reimbursement Methodologies for Inpatient Psychiatric Services 148.112 Medicaid High Volume Adjustment Payments 148.115 Reimbursement Methodologies for Long Term Acute Care Services 148.116 Reimbursement Methodologies for Children's Specialty Hospitals 148.117 Outpatient Assistance Adjustment Payments (Repealed) 148.120 Disproportionate Share Hospital (DSH) Adjustments 148.122 Medicaid Percentage Adjustments 148.126 Safety Net Adjustment Payments (Repealed) 148.130 Outlier Adjustments for Exceptionally Costly Stays DEPARTMENT OF HEALTHCARE AND FAMILY SERVICES NOTICE OF PROPOSED AMENDMENTS 148.140 Hospital Outpatient and Clinic Services 148.150 Public Law 103-66 Requirements 148.160 Payment Methodology for County-Owned Large Public Hospitals 148.170 Payment Methodology for University-Owned Large Public Hospitals 148.175 Supplemental Disproportionate Share Payment Methodology for Hospitals Organized Under the Town Hospital Act (Repealed) 148.180 Payment for Pre-operative Days and Patient Specific Orders 148.190 Copayments 148.200 Critical Access Hospital OB and Other Treatment Services Payment (CAHOOTS) 148.210 Filing Cost Reports 148.220 Pre September 1, 1991, Admissions (Repealed) 148.230 Admissions Occurring on or after September 1, 1991 (Repealed) 148.240 Utilization Review and Furnishing of Inpatient Hospital Services Directly or Under Arrangements 148.250 Determination of Alternate Payment Rates to Certain Exempt Hospitals (Repealed) 148.260 Calculation and Definitions of Inpatient Per Diem Rates (Repealed) 148.270 Determination of Alternate Cost Per Diem Rates For All Hospitals; Payment Rates for Certain Exempt Hospital Units; and Payment Rates for Certain Other Hospitals (Repealed) 148.280 Reimbursement Methodologies for Children's Hospitals and Hospitals Reimbursed Under Special Arrangements (Repealed) 148.285 Excellence in Academic Medicine Payments (Repealed) 148.290 Adjustments and Reductions to Total Payments 148.295 Critical Hospital Adjustment Payments (Repealed) 148.296 Transitional Supplemental Payments (Repealed) 148.297 Physician Development Incentive Payments 148.298 Pediatric Inpatient Adjustment Payments (Repealed) 148.299 Medicaid Facilitation and Utilization Payments (Repealed) 148.300 Payment 148.310 Review Procedure 148.320 Alternatives (Repealed) 148.330 Exemptions 148.340 Subacute Alcoholism and Substance Abuse Treatment Services 148.350 Definitions (Repealed) 148.360 Types of Subacute Alcoholism and Substance Abuse Treatment Services (Repealed) 148.368 Volume Adjustment (Repealed) 148.370 Payment for Sub-acute Alcoholism and Substance Abuse Treatment Services DEPARTMENT OF HEALTHCARE AND FAMILY SERVICES NOTICE OF PROPOSED AMENDMENTS 148.380 Rate Appeals for Subacute Alcoholism and Substance Abuse Treatment Services (Repealed) 148.390 Hearings 148.400 Special Hospital Reporting Requirements 148.401 Alzheimer's Treatment Access Payment 148.402 Expensive Drugs and Devices Add-On Payment 148.403 General Provisions – Inpatient 148.404 General Provisions − Outpatient 148.405 Graduate Medical Education (GME) Payment 148.406 Graduate Medical Education (GME) Payment for Large Public Hospitals 148.407 Medicaid High Volume Hospital Access Payment (Repealed) 148.408 Inpatient Simulated Base Rate Adjustment (Repealed) 148.409 Inpatient Small Public Hospital Access Payment (Repealed) 148.410 Long-Term Acute Care Access Payment (Repealed) 148.411 Medicaid Dependent Hospital Access Payment (Repealed) 148.412 Outpatient Simulated Base Rate Adjustment (Repealed) 148.413 Outpatient Small Public Hospital Access Payment (Repealed) 148.414 Perinatal and Rural Care Access Payment (Repealed) 148.415 Perinatal and Trauma Center Access Payment (Repealed) 148.416 Perinatal Care Access Payment (Repealed) 148.417 Psychiatric Care Access Payment for Distinct Part Units (Repealed) 148.418 Psychiatric Care Access Payment for Freestanding Psychiatric Hospitals (Repealed) 148.419 Safety-Net Hospital, Private Critical Access Hospital, and Outpatient High Volume Access Payments (Repealed) 148.420 Trauma Care Access Payment (Repealed) 148.421 Hospital Inpatient Adjustment 148.422 Safety Net Obstetrical Payment 148.423 Hospital Outpatient Adjustment 148.424 Outpatient Utilization Payments (Repealed) 148.425 Directed Payment Classifications 148.426 Outpatient Complexity of Care Adjustment Payments (Repealed) 148.428 Rehabilitation Hospital Adjustment Payments (Repealed) 148.430 Perinatal Outpatient Adjustment Payments (Repealed) 148.432 Supplemental Psychiatric Adjustment Payments (Repealed) 148.434 Outpatient Community Access Adjustment Payments (Repealed) 148.436 Long Term Stay Hospital Per Diem Payments (Repealed) 148.440 High Volume Adjustment Payments (Repealed) 148.442 Inpatient Services Adjustment Payments (Repealed) DEPARTMENT OF HEALTHCARE AND FAMILY SERVICES NOTICE OF PROPOSED AMENDMENTS 148.444 Capital Needs Payments (Repealed) 148.446 Obstetrical Care Payments (Repealed) 148.448 Trauma Care Payments (Repealed) 148.450 Supplemental Tertiary Care Payments (Repealed) 148.452 Crossover Care Payments (Repealed) 148.454 Magnet Hospital Payments (Repealed) 148.456 Ambulatory Procedure Listing Increase Payments (Repealed) 148.458 General Provisions (Repealed) 148.460 Catastrophic Relief Payments (Repealed) 148.462 Hospital Medicaid Stimulus Payments (Repealed) 148.464 General Provisions (Repealed) 148.466 Magnet and Perinatal Hospital Adjustment Payments (Repealed) 148.468 Trauma Level II Hospital Adjustment Payments (Repealed) 148.470 Dual Eligible Hospital Adjustment Payments (Repealed) 148.472 Medicaid Volume Hospital Adjustment Payments (Repealed) 148.474 Outpatient Service Adjustment Payments (Repealed) 148.476 Ambulatory Service Adjustment Payments (Repealed) 148.478 Specialty Hospital Adjustment Payments (Repealed) 148.480 ER Safety Net Payments (Repealed) 148.482 Physician Supplemental Adjustment Payments (Repealed) 148.484 Freestanding Children's Hospital Adjustment Payments (Repealed) 148.486 Freestanding Children's Hospital Outpatient Adjustment Payments (Repealed) SUBPART C: SEXUAL ASSAULT EMERGENCY TREATMENT PROGRAM Section 148.500 Definitions 148.510 Reimbursement SUBPART D: STATE CHRONIC RENAL DISEASE PROGRAM Section 148.600 Definitions 148.610 Scope of the Program 148.620 Assistance Level and Reimbursement 148.630 Criteria and Information Required to Establish Eligibility 148.640 Covered Services SUBPART E: INSTITUTION FOR MENTAL DISEASES PROVISIONS FOR HOSPITALS Section 148.700 General Provisions SUBPART F: EMERGENCY PSYCHIATRIC DEMONSTRATION PROGRAM Section 148.800 General Provisions 148.810 Definitions 148.820 Individual Eligibility for the Program 148.830 Providers Participating in the Program 148.840 Stabilization and Discharge Practices 148.850 Medication Management 148.860 Community Connect IMD Hospital Payment 148.870 Community Connect TCM Agency Payment 148.880 Program Reporting 148.TABLE A Renal Participation Fee Worksheet 148.TABLE B Bureau of Labor Statistics Equivalence 148.TABLE C List of Metropolitan Counties by SMSA Definition AUTHORITY: Implementing and authorized by Articles III, IV, V and VI and Section 12-13 of the Illinois Public Aid Code [305 ILCS 5]. SOURCE: Sections 148.10 thru 148.390 recodified from 89 Ill. Adm. Code 140.94 thru 140.398 at 13 Ill. Reg. 9572; Section 148.120 recodified from 89 Ill. Adm. Code 140.110 at 13 Ill. Reg. 12118; amended at 14 Ill. Reg. 2553, effective February 9, 1990; emergency amendment at 14 Ill. Reg. 11392, effective July 1, 1990, for a maximum of 150 days; amended at 14 Ill. Reg. 15358, effective September 13, 1990; amended at 14 Ill. Reg. 16998, effective October 4, 1990; amended at 14 Ill. Reg. 18293, effective October 30, 1990; amended at 14 Ill. Reg. 18499, effective November 8, 1990; emergency amendment at 15 Ill. Reg. 10502, effective July 1, 1991, for a maximum of 150 days; emergency expired October 29, 1991; emergency amendment at 15 Ill. Reg. 12005, effective August 9, 1991, for a maximum of 150 days; emergency expired January 6, 1992; emergency amendment at 15 Ill. Reg. 16166, effective November 1, 1991, for a maximum of 150 days; amended at 15 Ill. Reg. 18684, effective December 23, 1991; amended at 16 Ill. Reg. 6255, effective March 27, 1992; emergency amendment at 16 Ill. Reg. 11335, effective June 30, 1992, for a maximum of 150 days; emergency expired November 27, 1992; emergency amendment at 16 Ill. Reg. 11942, effective July 10, 1992, for a maximum of 150 days; emergency amendment at 16 Ill. Reg. 14778, effective October 1, 1992, for a maximum of DEPARTMENT OF HEALTHCARE AND FAMILY SERVICES NOTICE OF PROPOSED AMENDMENTS 150 days; amended at 16 Ill. Reg. 19873, effective December 7, 1992; amended at 17 Ill. Reg. 131, effective December 21, 1992; amended at 17 Ill. Reg. 3296, effective March 1, 1993; amended at 17 Ill. Reg. 6649, effective April 21, 1993; amended at 17 Ill. Reg. 14643, effective August 30, 1993; emergency amendment at 17 Ill. Reg. 17323, effective October 1, 1993, for a maximum of 150 days; amended at 18 Ill. Reg. 3450, effective February 28, 1994; emergency amendment at 18 Ill. Reg. 12853, effective August 2, 1994, for a maximum of 150 days; amended at 18 Ill. Reg. 14117, effective September 1, 1994; amended at 18 Ill. Reg. 17648, effective November 29, 1994; amended at 19 Ill. Reg. 1067, effective January 20, 1995; emergency amendment at 19 Ill. Reg. 3510, effective March 1, 1995, for a maximum of 150 days; emergency expired July 29, 1995; emergency amendment at 19 Ill. Reg. 6709, effective May 12, 1995, for a maximum of 150 days; amended at 19 Ill. Reg. 10060, effective June 29, 1995; emergency amendment at 19 Ill. Reg. 10752, effective July 1, 1995, for a maximum of 150 days; amended at 19 Ill. Reg. 13009, effective September 5, 1995; amended at 19 Ill. Reg. 16630, effective November 28, 1995; amended at 20 Ill. Reg. 872, effective December 29, 1995; amended at 20 Ill. Reg. 7912, effective May 31, 1996; emergency amendment at 20 Ill. Reg. 9281, effective July 1, 1996, for a maximum of 150 days; emergency amendment at 20 Ill. Reg. 12510, effective September 1, 1996, for a maximum of 150 days; amended at 20 Ill. Reg. 15722, effective November 27, 1996; amended at 21 Ill. Reg. 607, effective January 2, 1997; amended at 21 Ill. Reg. 8386, effective June 23, 1997; emergency amendment at 21 Ill. Reg. 9552, effective July 1, 1997, for a maximum of 150 days; emergency amendment at 21 Ill. Reg. 9822, effective July 2, 1997, for a maximum of 150 days; emergency amendment at 21 Ill. Reg. 10147, effective August 1, 1997, for a maximum of 150 days; amended at 21 Ill. Reg. 13349, effective September 23, 1997; emergency amendment at 21 Ill. Reg. 13675, effective September 27, 1997, for a maximum of 150 days; amended at 21 Ill. Reg. 16161, effective November 26, 1997; amended at 22 Ill. Reg. 1408, effective December 29, 1997; amended at 22 Ill. Reg. 3083, effective January 26, 1998; amended at 22 Ill. Reg. 11514, effective June 22, 1998; emergency amendment at 22 Ill. Reg. 13070, effective July 1, 1998, for a maximum of 150 days; emergency amendment at 22 Ill. Reg. 15027, effective August 1, 1998, for a maximum of 150 days; amended at 22 Ill. Reg. 16273, effective August 28, 1998; amended at 22 Ill. Reg. 21490, effective November 25, 1998; amended at 23 Ill. Reg. 5784, effective April 30, 1999; amended at 23 Ill. Reg. 7115, effective June 1, 1999; amended at 23 Ill. Reg. 7908, effective June 30, 1999; emergency amendment at 23 Ill. Reg. 8213, effective July 1, 1999, for a maximum of 150 days; emergency amendment at 23 Ill. Reg. 12772, effective October 1, 1999, for a maximum of 150 days; amended at 23 Ill. Reg. 13621, effective November 1, 1999; amended at 24 Ill. Reg. 2400, effective February 1, 2000; amended at 24 Ill. Reg. 3845, effective February 25, 2000; emergency amendment at 24 Ill. Reg. 10386, effective July 1, 2000, for a maximum of 150 days; amended at 24 Ill. Reg. 11846, effective August 1, 2000; amended at 24 Ill. Reg. 16067, effective October 16, 2000; amended at 24 Ill. Reg. 17146, effective November 1, 2000; amended at 24 Ill. Reg. 18293, effective December 1, 2000; amended at 25 Ill. Reg. 5359, DEPARTMENT OF HEALTHCARE AND FAMILY SERVICES NOTICE OF PROPOSED AMENDMENTS effective April 1, 2001; emergency amendment at 25 Ill. Reg. 5432, effective April 1, 2001, for a maximum of 150 days; amended at 25 Ill. Reg. 6959, effective June 1, 2001; emergency amendment at 25 Ill. Reg. 9974, effective July 23, 2001, for a maximum of 150 days; amended at 25 Ill. Reg. 10513, effective August 2, 2001; emergency amendment at 25 Ill. Reg. 12870, effective October 1, 2001, for a maximum of 150 days; emergency expired February 27, 2002; amended at 25 Ill. Reg. 16087, effective December 1, 2001; emergency amendment at 26 Ill. Reg. 536, effective December 31, 2001, for a maximum of 150 days; emergency amendment at 26 Ill. Reg. 680, effective January 1, 2002, for a maximum of 150 days; amended at 26 Ill. Reg. 4825, effective March 15, 2002; emergency amendment at 26 Ill. Reg. 4953, effective March 18, 2002, for a maximum of 150 days; emergency amendment repealed at 26 Ill. Reg. 7786, effective July 1, 2002; emergency amendment at 26 Ill. Reg. 7340, effective April 30, 2002, for a maximum of 150 days; amended at 26 Ill. Reg. 8395, effective May 28, 2002; emergency amendment at 26 Ill. Reg. 11040, effective July 1, 2002, for a maximum of 150 days; emergency amendment repealed at 26 Ill. Reg. 16612, effective October 22, 2002; amended at 26 Ill. Reg. 12322, effective July 26, 2002; amended at 26 Ill. Reg. 13661, effective September 3, 2002; amended at 26 Ill. Reg. 14808, effective September 26, 2002; emergency amendment at 26 Ill. Reg. 14887, effective October 1, 2002, for a maximum of 150 days; amended at 26 Ill. Reg. 17775, effective November 27, 2002; emergency amendment at 27 Ill. Reg. 580, effective January 1, 2003, for a maximum of 150 days; emergency amendment at 27 Ill. Reg. 866, effective January 1, 2003, for a maximum of 150 days; amended at 27 Ill. Reg. 4386, effective February 24, 2003; emergency amendment at 27 Ill. Reg. 8320, effective April 28, 2003, for a maximum of 150 days; emergency amendment repealed at 27 Ill. Reg. 12121, effective July 10, 2003; amended at 27 Ill. Reg. 9178, effective May 28, 2003; emergency amendment at 27 Ill. Reg. 11041, effective July 1, 2003, for a maximum of 150 days; emergency amendment at 27 Ill. Reg. 16185, effective October 1, 2003, for a maximum of 150 days; emergency amendment at 27 Ill. Reg. 16268, effective October 1, 2003, for a maximum of 150 days; amended at 27 Ill. Reg. 18843, effective November 26, 2003; emergency amendment at 28 Ill. Reg. 1418, effective January 8, 2004, for a maximum of 150 days; emergency amendment at 28 Ill. Reg. 1766, effective January 10, 2004, for a maximum of 150 days; emergency expired June 7, 2004; amended at 28 Ill. Reg. 2770, effective February 1, 2004; emergency amendment at 28 Ill. Reg. 5902, effective April 1, 2004, for a maximum of 150 days; amended at 28 Ill. Reg. 7101, effective May 3, 2004; amended at 28 Ill. Reg. 8072, effective June 1, 2004; emergency amendment at 28 Ill. Reg. 8167, effective June 1, 2004, for a maximum of 150 days; amended at 28 Ill. Reg. 9661, effective July 1, 2004; emergency amendment at 28 Ill. Reg. 10157, effective July 1, 2004, for a maximum of 150 days; emergency amendment at 28 Ill. Reg. 12036, effective August 3, 2004, for a maximum of 150 days; emergency expired December 30, 2004; emergency amendment at 28 Ill. Reg. 12227, effective August 6, 2004, for a maximum of 150 days; emergency expired January 2, 2005; amended at 28 Ill. Reg. 14557, effective October 27, 2004; amended at 28 Ill. Reg. 15536, effective November 24, 2004; amended at 29 Ill. Reg. 861, DEPARTMENT OF HEALTHCARE AND FAMILY SERVICES NOTICE OF PROPOSED AMENDMENTS effective January 1, 2005; emergency amendment at 29 Ill. Reg. 2026, effective January 21, 2005, for a maximum of 150 days; amended at 29 Ill. Reg. 5514, effective April 1, 2005; emergency amendment at 29 Ill. Reg. 5756, effective April 8, 2005, for a maximum of 150 days; emergency amendment repealed by emergency rulemaking at 29 Ill. Reg. 11622, effective July 5, 2005, for the remainder of the 150 days; amended at 29 Ill. Reg. 8363, effective June 1, 2005; emergency amendment at 29 Ill. Reg. 10275, effective July 1, 2005, for a maximum of 150 days; emergency amendment at 29 Ill. Reg. 12568, effective August 1, 2005, for a maximum of 150 days; emergency amendment at 29 Ill. Reg. 15629, effective October 1, 2005, for a maximum of 150 days; amended at 29 Ill. Reg. 19973, effective November 23, 2005; amended at 30 Ill. Reg. 383, effective December 28, 2005; emergency amendment at 30 Ill. Reg. 596, effective January 1, 2006, for a maximum of 150 days; emergency amendment at 30 Ill. Reg. 955, effective January 9, 2006, for a maximum of 150 days; amended at 30 Ill. Reg. 2827, effective February 24, 2006; emergency amendment at 30 Ill. Reg. 7786, effective April 10, 2006, for a maximum of 150 days; emergency amendment repealed by emergency rulemaking at 30 Ill. Reg. 12400, effective July 1, 2006, for the remainder of the 150 days; emergency expired September 6, 2006; amended at 30 Ill. Reg. 8877, effective May 1, 2006; amended at 30 Ill. Reg. 10393, effective May 26, 2006; emergency amendment at 30 Ill. Reg. 11815, effective July 1, 2006, for a maximum of 150 days; amended at 30 Ill. Reg. 18672, effective November 27, 2006; emergency amendment at 31 Ill. Reg. 1602, effective January 1, 2007, for a maximum of 150 days; emergency amendment at 31 Ill. Reg. 1997, effective January 15, 2007, for a maximum of 150 days; amended at 31 Ill. Reg. 5596, effective April 1, 2007; amended at 31 Ill. Reg. 8123, effective May 30, 2007; amended at 31 Ill. Reg. 8508, effective June 1, 2007; emergency amendment at 31 Ill. Reg. 10137, effective July 1, 2007, for a maximum of 150 days; amended at 31 Ill. Reg. 11688, effective August 1, 2007; amended at 31 Ill. Reg. 14792, effective October 22, 2007; amended at 32 Ill. Reg. 312, effective January 1, 2008; emergency amendment at 32 Ill. Reg. 518, effective January 1, 2008, for a maximum of 150 days; emergency amendment at 32 Ill. Reg. 2993, effective February 16, 2008, for a maximum of 150 days; amended at 32 Ill. Reg. 8718, effective May 29, 2008; amended at 32 Ill. Reg. 9945, effective June 26, 2008; emergency amendment at 32 Ill. Reg. 10517, effective July 1, 2008, for a maximum of 150 days; emergency expired November 27, 2008; amended at 33 Ill. Reg. 501, effective December 30, 2008; peremptory amendment at 33 Ill. Reg. 1538, effective December 30, 2008; emergency amendment at 33 Ill. Reg. 5821, effective April 1, 2009, for a maximum of 150 days; emergency expired August 28, 2009; amended at 33 Ill. Reg. 13246, effective September 8, 2009; emergency amendment at 34 Ill. Reg. 15856, effective October 1, 2010, for a maximum of 150 days; emergency expired February 27, 2011; amended at 34 Ill. Reg. 17737, effective November 8, 2010; amended at 35 Ill. Reg. 420, effective December 27, 2010; expedited correction at 38 Ill. Reg. 12618, effective December 27, 2010; amended at 35 Ill. Reg. 10033, effective June 15, 2011; amended at 35 Ill. Reg. 16572, effective October 1, 2011; emergency amendment at 36 Ill. Reg. 10326, effective July 1, 2012 through June 30, 2013; emergency amendment to Section DEPARTMENT OF HEALTHCARE AND FAMILY SERVICES NOTICE OF PROPOSED AMENDMENTS 148.70(g) suspended at 36 Ill. Reg. 13737, effective August 15, 2012; suspension withdrawn from Section 148.70(g) at 36 Ill. Reg. 18989, December 11, 2012; emergency amendment in response to Joint Committee on Administrative Rules action on Section 148.70(g) at 36 Ill. Reg. 18976, effective December 12, 2012 through June 30, 2013; emergency amendment to Section 148.140(b)(1)(F) suspended at 36 Ill. Reg. 13739, effective August 15, 2012; suspension withdrawn from Section 148.140(b)(1)(F) at 36 Ill. Reg. 14530, September 11, 2012; emergency amendment to Sections 148.140(b) and 148.190(a)(2) in response to Joint Committee on Administrative Rules action at 36 Ill. Reg. 14851, effective September 21, 2012 through June 30, 2013; amended at 37 Ill. Reg. 402, effective December 27, 2012; emergency rulemaking at 37 Ill. Reg. 5082, effective April 1, 2013 through June 30, 2013; amended at 37 Ill. Reg. 10432, effective June 27, 2013; amended at 37 Ill. Reg. 17631, effective October 23, 2013; amended at 38 Ill. Reg. 4363, effective January 29, 2014; amended at 38 Ill. Reg. 11557, effective May 13, 2014; amended at 38 Ill. Reg. 13263, effective June 11, 2014; amended at 38 Ill. Reg. 15165, effective July 2, 2014; emergency amendment at 39 Ill. Reg. 10453, effective July 10, 2015, for a maximum of 150 days; emergency expired December 6, 2015; amended at 39 Ill. Reg. 10824, effective July 27, 2015; amended at 39 Ill. Reg. 16394, effective December 14, 2015; amended at 41 Ill. Reg. 1041, effective January 19, 2017; amended at 42 Ill. Reg. 3152, effective January 31, 2018; emergency amendment at 42 Ill. Reg. 13740, effective July 2, 2018, for a maximum of 150 days; emergency amendment to emergency rule at 42 Ill. Reg. 16318, effective August 13, 2018, for the remainder of the 150 days; emergency expired November 28, 2018; amended at 42 Ill. Reg. 22401, effective November 29, 2018; emergency amendment at 43 Ill. Reg. 9813, effective August 26, 2019, for a maximum of 150 days; amended at 44 Ill. Reg. 2545, effective January 22, 2020; amended at 44 Ill. Reg. 18579, effective November 9, 2020; emergency amendment at 44 Ill. Reg. 12832, effective July 17, 2020, for a maximum of 150 days; amended at 44 Ill. Reg. 19767, effective December 11, 2020; amended at 46 Ill. Reg. 5254, effective March 11, 2022; amended at 47 Ill. Reg. 5648, effective April 5, 2023; amended at 47 Ill. Reg. 13121, effective August 25, 2023; amended at 47 Ill. Reg. 16418, effective November 3, 2023; expedited correction at 48 Ill. Reg. 10028, effective November 3, 2023; amended at 48 Ill. Reg. 10834, effective July 12, 2024; amended at 48 Ill. Reg. 15451, effective October 17, 2024; amended at 49 Ill. Reg. 2024, effective February 10, 2025; amended at 50 Ill. Reg. 7685, effective May 20, 2026; amended at 50 Ill. Reg. 13898, effective September 2, 2026; amended at 50 Ill. Reg. ______, effective ____________. SUBPART B: REIMBURSEMENT AND RELATED PROVISIONS Section 148.120 Disproportionate Share Hospital (DSH) Adjustments Effective for dates of service on or after July 1, 2014: DEPARTMENT OF HEALTHCARE AND FAMILY SERVICES NOTICE OF PROPOSED AMENDMENTS a) Qualified Disproportionate Share Hospitals (DSH). The Department shall make adjustment payments to hospitals that are deemed as disproportionate share by the Department. A hospital may qualify for a DSH adjustment in one of the following ways: 1) The hospital's Medicaid inpatient utilization rate (MIUR), as defined in subsection (i)(4), is at least one standard deviation above the mean Medicaid utilization rate, as defined in subsection (i)(3). 2) The hospital's low income utilization rate, as defined in subsection (i)(6), exceeds 25 per centum. b) In addition, to be deemed a DSH hospital, a hospital must provide the Department, in writing, with the names of at least two obstetricians with staff privileges at the hospital who have agreed to provide obstetric services to individuals entitled to such services under a State Medicaid plan. In the case of a hospital located in a rural area (that is, an area outside of a Metropolitan Statistical Area, as defined by the Executive Office of Management and Budget), the term "obstetrician" includes any physician with staff privileges to perform nonemergency obstetric procedures at the hospital. This requirement does not apply to a hospital in which the inpatients are predominantly individuals under 18 years of age; or does not offer nonemergency obstetric services as of December 22, 1987. Hospitals that do not offer nonemergency obstetrics to the general public, with the exception of those hospitals described in Section 148.25(d), must submit a statement to that effect. c) In making the determination described in subsection (a)(1), the Department shall utilize: 1) Hospital Cost Reports A) The hospital's final audited cost report for the hospital's base fiscal year. Medicaid inpatient utilization rates, as defined in subsection (i)(4), that have been derived from final audited cost reports, are not subject to the Review Procedure described in Section 148.310, with the exception of errors in calculation. B) In the absence of a final audited cost report for the hospital's base fiscal year, the Department shall utilize the hospital's unaudited DEPARTMENT OF HEALTHCARE AND FAMILY SERVICES NOTICE OF PROPOSED AMENDMENTS cost report for the hospital's base fiscal year. Due to the unaudited nature of this information, hospitals shall have the opportunity to submit a corrected cost report for the determination described in subsection (a)(1). Submittal of a corrected cost report in support of subsection (a)(1) must be received or post marked no later than the first day of July preceding the DSH determination year for which the hospital is requesting consideration of such corrected cost report for the determination of DSH qualification. Corrected cost reports which are not received in compliance with these time limitations will not be considered for the determination of the hospital's MIUR as described in subsection (i)(4). C) Hospitals' Medicaid inpatient utilization rates, as defined in subsection (i)(4), that have been derived from unaudited cost reports are not subject to the Review Procedure described in Section 148.310, with the exception of errors in calculation. Pursuant to subsection (c)(1)(B), hospitals shall have the opportunity to submit corrected information prior to the Department's final DSH determination. D) In the event a subsequent final audited cost report reflects an MIUR, as described in subsection (i)(4), that is lower than the Medicaid inpatient utilization rate derived from the unaudited cost report or the HDSC form utilized for the DSH determination, the Department shall recalculate the MIUR based upon the final audited cost report, and recoup any overpayments made if the percentage change in the DSH payment rate is greater than five percent. 2) Days Not Available from Cost Report Certain types of inpatient days of care provided to Title XIX recipients are not available from the cost report, i.e., Medicare/Medicaid crossover claims, out-of-state Title XIX Medicaid utilization levels, Medicaid managed care entity (MCE) days, hospital residing long term care days, and Medicaid days for alcohol and substance abuse sub-acute care under category of service 035, and Department of Human Services forensic days. To obtain Medicaid utilization levels in these instances, the Department shall utilize: DEPARTMENT OF HEALTHCARE AND FAMILY SERVICES NOTICE OF PROPOSED AMENDMENTS A) Medicare/Medicaid Crossover Claims. The Department will utilize the Department's paid claims data adjudicated through the last day of June preceding the DSH determination year for each hospital's base fiscal year. B) Out-of-state Title XIX Utilization Levels. Hospital statements and verification reports from other states will be required to verify out- of-state Medicaid recipient utilization levels. The information submitted must include only those days of care provided to out-of- state Medicaid recipients during the hospital's base fiscal year. C) MCE days. The Department will utilize the Department's MCE claims data available to the Department as of the last day of June preceding the DSH determination year, or specific claim information from each MCE, for each hospital's base fiscal year to determine the number of inpatient days provided to recipients enrolled in an MCE. D) Hospital Residing Long Term Care Days. The Department will utilize the Department's paid claims data adjudicated through the last day of June preceding the DSH determination year for each hospital's base fiscal year to determine the number of hospital residing long term care days provided to recipients. E) Alcohol and Substance Abuse Days. The Department will utilize its paid claims data under category of service 35 available to the Department as of the last day of June preceding the DSH determination year for each hospital's base fiscal year to determine the number of inpatient days provided for alcohol and substance abuse rehabilitative care. F) DHS Forensic Days. The Department will accept reports containing verification information as determined by the Department from hospitals with contracts with DHS for days of care reimbursed by the Department of Human Services for mental health services provided under a specified provision of the Code of Criminal Procedure of 1963. d) Hospitals may apply for DSH status under subsection (a)(2) by submitting an DEPARTMENT OF HEALTHCARE AND FAMILY SERVICES NOTICE OF PROPOSED AMENDMENTS audited certified financial statement, for the hospital's base fiscal year, to the Department. The statements must contain the following breakdown of information prior to submittal to the Department for consideration: 1) Total hospital net revenue for all patient services, both inpatient and outpatient, for the hospital's base fiscal year. 2) Total payments received directly from State and local governments for all patient services, both inpatient and outpatient, for the hospital's base fiscal year. 3) Total gross inpatient hospital charges for charity care (this must not include contractual allowances, bad debt or discount), for the hospital's base fiscal year. 4) Total amount of the hospital's gross charges for inpatient hospital services for the hospital's base fiscal year. e) With the exception of cost-reporting children's hospitals in contiguous states that provide 100 or more inpatient days of care to Illinois program participants, only those cost-reporting hospitals located in states contiguous to Illinois that qualify for DSH in the state in which they are located based upon the federal definition of a DSH hospital (42 U.S.C.USC 1396-4(b)(1)) may qualify for DSH hospital adjustments under this Section. For purposes of determining the MIUR, as described in subsection (i)(4) and as required in the federal definition (42 U.S.C.USC 1396r-4(b)(1)), out-of-state hospitals will be measured in relationship to one standard deviation above the mean Medicaid inpatient utilization rate in their state. Out-of-state hospitals that do not qualify by the MIUR from their state may submit an audited certified financial statement as described in subsection (d). Payments to out-of-state hospitals will be allocated using the same method as described in subsection (g). f) Time Limitation Requirements for Additional Information. 1) The information required in subsections (a), (c), (d) and (e) must be received or post marked no later than the first day of July preceding the DSH determination year for which the hospital is requesting consideration of the information for the determination of DSH qualification. Information required in subsections (a), (c), (d) and (e) that is not received DEPARTMENT OF HEALTHCARE AND FAMILY SERVICES NOTICE OF PROPOSED AMENDMENTS or post marked in compliance with these limitations will not be considered for the determination of those hospitals qualified for DSH adjustments. 2) The information required in subsection (b) must be submitted after receipt of notification from the Department. Information required in this Section that is not received in compliance with these limitations will not be considered for the determination of those hospitals qualified for DSH adjustments. g) Inpatient Payment Adjustments to DSH Hospitals. The adjustment payments required by subsection (a) shall be calculated annually as follows: 1) Five Million Dollar Fund Adjustment for hospitals defined in Section 148.25(b)(1), with the exception of any Illinois hospital that is owned or operated by the State or a unit of local government. A) Hospitals qualifying as DSH hospitals under subsection (a)(1) or (a)(2) will receive an add-on payment to their inpatient rate. B) The distribution method for the add-on payment described in subsection (g)(1) is based upon a fund of $5 million. All hospitals qualifying under subsection (g)(1)(A) will receive a $5 per day add-on to their current rate. The total cost of this adjustment is calculated by multiplying each hospital's most recent completed fiscal year Medicaid inpatient utilization data (adjusted based upon historical utilization and projected increases in utilization) by $5. The total dollar amount of this calculation is then subtracted from the $5 million fund. C) The remaining fund balance is then distributed to the hospitals that qualify under subsection (a)(1) in proportion to the percentage by which the hospital's MIUR exceeds one standard deviation above the State's mean Medicaid inpatient utilization rate, as described in subsection (i)(3). This is done by finding the ratio of each hospital's percent Medicaid utilization to the State's mean plus one standard deviation percent Medicaid value. These ratios are then summed and each hospital's proportion of the total is calculated. These proportional values are then multiplied by each hospital's most recent completed fiscal year Medicaid inpatient utilization DEPARTMENT OF HEALTHCARE AND FAMILY SERVICES NOTICE OF PROPOSED AMENDMENTS data (adjusted based upon historical utilization and projected increases in utilization). These weighted values are summed and each hospital's proportion of the summed weighted value is calculated. Each individual hospital's proportional value is then multiplied against the $5 million pool of money available after the $5 per day base add-on has been subtracted. D) The total dollar amount calculated for each qualifying hospital under subsection (g)(1)(C), plus the initial $5 per day add-on amount calculated for each qualifying hospital under subsection (g)(1)(B), is then divided by the Medicaid inpatient utilization data (adjusted based upon historical utilization and projected increases in utilization) to arrive at a per day add-on value. Hospitals qualifying under subsection (a)(2) will receive the minimum adjustment of $5 per inpatient day. The adjustments calculated under this subsection (g)(1) are subject to the limitations described in subsection (h). The adjustments calculated under subsection (g) shall be paid on a per diem basis and shall be applied to each covered day of care provided. 2) Department of Human Services (DHS) State-Operated Facility Adjustment for Hospitals Defined in Section 148.25(a)(3). DHS State- operated facilities qualifying under subsection (a)(2) shall receive an adjustment calculated as follows: A) The amount of the adjustment is based on a State DSH Pool. The State DSH Pool amount shall be the federal DSH allotment for mental health facilities as determined in section 1923(h) of the Social Security Act, minus the estimated DSH payments to such facilities that are not operated by the State. B) The State DSH Pool amount is then allocated to hospitals defined in Section 148.25(a)(3) that qualify for DSH adjustments by multiplying the State DSH Pool amount by each hospital's ratio of uncompensated care costs, from the most recent final cost report, to the sum of all qualifying hospitals' uncompensated care costs. C) The adjustment calculated in subsection (g)(2)(B) shall meet the limitation described in subsection (h)(4). DEPARTMENT OF HEALTHCARE AND FAMILY SERVICES NOTICE OF PROPOSED AMENDMENTS D) The adjustment calculated pursuant to subsection (g)(2)(B), for each hospital defined in Section 148.25(a)(3) that qualifies for DSH adjustments, is then divided by four to arrive at a quarterly adjustment. This amount is subject to the limitations described in subsection (h). The adjustment described in this subsection (g)(2)(D) shall be paid on a quarterly basis. 3) Assistance for Certain Public Hospitals A) The Department may make an annual payment adjustment to qualifying hospitals in the DSH determination year. A qualifying hospital is a public hospital as defined in section 701(d) of the Medicare, Medicaid, and SCHIP Benefits Improvement and Protection Act of 2000 (Public Law 106-554). B) Hospitals qualifying shall receive an annual payment adjustment that is equal to: i) A rate amount equal to the amount specified in the Medicare, Medicaid, and SCHIP Benefits Improvement and Protection Act of 2000, section 701(d)(3)(B) for the DSH determination year; ii) Divided first by Illinois' Federal Medical Assistance Percentage; iii) Divided secondly by the sum of the qualified hospitals' total Medicaid inpatient days, as defined in subsection (i)(4); and iv) Multiplied by each qualified hospital's Medicaid inpatient days as defined in subsection (i)(4). C) The annual payment adjustment calculated under this subsection (g)(3), for each qualified hospital, will be divided by four and paid on a quarterly basis. D) Payment adjustments under this subsection (g)(3) shall be made DEPARTMENT OF HEALTHCARE AND FAMILY SERVICES NOTICE OF PROPOSED AMENDMENTS without regard to subsections (h)(3) and (4) of this Section, 42 CFR 447.272, or any standards promulgated by the Department of Health and Human Services pursuant to section 701(e) of the Medicare, Medicaid, and SCHIP Benefits Improvement and Protection Act of 2000. E) In order to qualify for assistance payments under this subsection (g)(3), with regard to this payment adjustment, there must be in force an executed intergovernmental agreement between the authorized governmental body of the qualifying hospital and the Department. 4) Disproportionate Share Payments for Certain Government-Owned or -Operated Hospitals A) The following classes of government-owned or -operated Illinois hospitals shall, subject to the limitations set forth in subsection (h), be eligible for the Disproportionate Share Hospital Adjustment payment: i) Hospitals defined in Section 148.25(a). ii) Hospitals owned or operated by a unit of local government that is located within Illinois and is not a hospital defined in subsection (i). B) The annual amount of the payment shall be the amount computed for the hospital pursuant to federal limitations. C) The annual amount shall be paid to the hospital in monthly installments. h) DSH Adjustment Limitations 1) Hospitals that qualify for DSH adjustments under this Section shall not be eligible for the total DSH adjustment if, during the DSH determination year, the hospital discontinues provision of nonemergency obstetrical care. The provisions of this subsection (h)(1) shall not apply to those hospitals described in Section 148.25(d) or those hospitals that have not offered DEPARTMENT OF HEALTHCARE AND FAMILY SERVICES NOTICE OF PROPOSED AMENDMENTS nonemergency obstetric services as of December 22, 1987. In this instance, the adjustments calculated under subsection (g)(1) shall cease to be effective on the date that the hospital discontinued the provision of such nonemergency obstetrical care. 2) Inpatient Payment Adjustments based upon DSH Determination Reviews. Appeals based upon a hospital's ineligibility for DSH payment adjustments, or their payment adjustment amounts, in accordance with Section 148.310(b), which result in a change in a hospital's eligibility for DSH payment adjustments or a change in a hospital's payment adjustment amounts, shall not affect the DSH status of any other hospital or the payment adjustment amount of any other hospital that has received notification from the Department of its eligibility for DSH payment adjustments based upon the requirements of this Section. 3) DSH Payment Adjustment. If the aggregate DSH payment adjustments calculated under this Section do not meet the State's final DSH Allotment as determined by the federal Centers for Medicare and Medicaid Services, DSH payment adjustments calculated under this Section shall be adjusted to meet the State DSH Allotment. Subject to any limitation, disproportionate share payments will be made to qualifying hospitals in the following order: A) Hospitals defined in Section 148.25(a)(3) – the annual amount shall be credited quarterly via certification of public expenditure. B) Hospitals defined in Section 148.25(a)(2). C) Hospitals defined in subsection (g)(4)(A)(ii) of this Section. D) Hospitals that are not owned or operated by a unit of government – the annual amount shall be paid on each inpatient claim. E) Hospitals defined in Section 148.25(a)(1). 4) Omnibus Budget Reconciliation Act of 1993 (OBRA'93) Adjustments. In accordance with Public Law 103-66, adjustments to individual hospitals' disproportionate share payments shall be made if the sum of estimated Medicaid payments (inpatient, outpatient, and disproportionate share) to a DEPARTMENT OF HEALTHCARE AND FAMILY SERVICES NOTICE OF PROPOSED AMENDMENTS hospital exceed the costs of providing services to Medicaid clients and persons without insurance. Federal upper payment limit requirements (42 CFR 447.272) shall be considered when calculating the OBRA'93 adjustments. The adjustments shall reduce disproportionate share spending until the costs and spending (described in this subsection (h)(4)) are equal or until the disproportionate share payments are reduced to zero. In this calculation, persons without insurance costs do not include contractual allowances. Hospitals qualifying for DSH payment adjustments must submit the information required in Section 148.150. 5) Medicaid Inpatient Utilization Rate Limit. Hospitals that qualify for DSH payment adjustments under this Section shall not be eligible for DSH payment adjustments if the hospital's MIUR, as defined in subsection (i)(4) of this Section, is less than one percent. i) Inpatient Payment Adjustment Definitions. The definitions of terms used with reference to calculation of the inpatient payment adjustments are as follows: 1) "Base fiscal year" means the hospital's fiscal year ending in the calendar year 22 months before the beginning of the DSH determination year. 2) "DSH determination year" means the 12-month period beginning on October 1 of the year and ending September 30 of the following year. 3) "Mean Medicaid inpatient utilization rate" means a fraction, the numerator of which is the total number of inpatient days provided in a given 12- month period by all Medicaid-participating Illinois hospitals to patients who, for such days, were eligible for Medicaid under Title XIX of the federal Social Security Act (42 U.S.C.USC 1396a et seq.), and the denominator of which is the total number of inpatient days provided by those same hospitals. In this subsection (i)(3), the term "inpatient day" includes each day in which an individual (including a newborn) is an inpatient in the hospital whether or not the individual is in a specialized ward and whether or not the individual remains in the hospital for lack of suitable placement elsewhere. 4) "Medicaid inpatient utilization rate" means a fraction, the numerator of which is the number of a hospital's inpatient days provided in a given 12 month period to patients who, for such days, were eligible for Medicaid DEPARTMENT OF HEALTHCARE AND FAMILY SERVICES NOTICE OF PROPOSED AMENDMENTS under Title XIX of the federal Social Security Act (42 U.S.C.USC 1396a et seq.) and the denominator of which is the total number of the hospital's inpatient days in that same period. In this subsection (i)(4), the term "inpatient day" includes each day in which an individual (including a newborn) is an inpatient in the hospital whether or not the individual is in a specialized ward and whether or not the individual remains in the hospital for lack of suitable placement elsewhere. 5) "Obstetric services" shall at a minimum include non-emergency inpatient deliveries in the hospital. 6) "Low income utilization rate" means a fraction, expressed as a percentage that is the sum of the amount resulting from the calculations in subsection (i)(6)(A) plus (i)(6)(B): A) The fraction (expressed as a percentage) − i) the numerator of which is the sum of the total revenues paid the hospital for patient services under Medicaid State plan (regardless of whether the services were furnished on a fee-for-service basis or through a managed care entity) and the amount of the cash subsidies for patient services received directly from State and local governments, and ii) the denominator of which is the total amount of revenues of the hospital for patient services (including the amount of such cash subsidies) in the period; and B) The fraction (expressed as a percentage) − i) the numerator of which is the total amount of the hospital's charges for inpatient hospital services which are attributable to charity care in a period, less the portion of any cash subsidies described in subsection (6)(A)(i); and ii) the denominator of which is the total amount of the hospital's charges for inpatient hospital services in the hospital in the period. DEPARTMENT OF HEALTHCARE AND FAMILY SERVICES NOTICE OF PROPOSED AMENDMENTS (Source: Amended at 50 Ill. Reg. ______, effective ____________) Section 148.122 Medicaid Percentage Adjustments Effective for dates of service on or after July 1, 2014, unless another date is specified, the Department shall make an annual determination of those hospitals qualified for adjustments under this Section effective October 1 of each year unless otherwise noted. a) Qualified Medicaid Percentage Hospitals. The Department shall make adjustment payments to hospitals that are deemed as a Medicaid percentage hospital by the Department. A hospital, except those that are owned or operated by a unit of government, may qualify for a Medicaid Percentage Adjustment (MPA) in one of the following ways: 1) The hospital's Medicaid inpatient utilization rate (MIUR), as defined in Section 148.120(i)(4), is at least one-half standard deviation above the mean Medicaid utilization rate, as defined in Section 148.120(i)(3). 2) The hospital's low income utilization rate, as defined in Section 148.120(i)(6), exceeds 25 per centum. 3) Illinois hospitals that, on July 1, 1991, had an MIUR, as defined in Section 148.120(i)(4), that was at least the mean Medicaid inpatient utilization rate, as defined in Section 148.120(i)(3), and that were located in a planning area with one-third or fewer excess beds as determined by the Illinois Health Facilities Planning Board (see 77 Ill. Adm. Code 1100), and that, as of June 30, 1992, were located in a federally designated Health Manpower Shortage Area (see 42 CFR 5 (1989)). 4) Illinois hospitals that meet the following criteria: A) Have an MIUR, as defined in Section 148.120(i)(4), that is at least the mean Medicaid inpatient utilization rate, as defined in Section 148.120(i)(3). B) Have a Medicaid obstetrical inpatient utilization rate, as defined in subsection (g)(3), that is at least one standard deviation above the mean Medicaid obstetrical inpatient utilization rate, as defined in subsection (g)(2). 5) Any children's hospital, as defined in Section 148.25(d)(3). 6) Out of state hospitals meeting the criteria in Section 148.120(e). 7) A hospital that reopened a previously closed hospital facility, which includes hospitals that have been terminated from participation in the medical assistance program in accordance with 305 ILCS 5/12-4.25, within 4 calendar years of the hospital facility's closure. b) Special considerations to the MIUR calculation. 1)b) In making the determination described in subsections (a)(1) and (a)(4)(A), the Department shall utilize the data described in Section 148.120(c) and received in compliance with Section 148.120(f). Effective for Medicaid Percentage rate year 2024 and thereafter, the Medicaid Inpatient utilization rate, as defined in Section 148.120(i)(4) and used in the determination of eligibility for payments under subsection (d), shall be modified to exclude from both the numerator and denominator, all days of care provided to military recruits or trainees for the United States Navy and covered by TRICARE or its successor. 2) In making the determination described in subsections (a)(1) and (a)(4)(A), the Department shall utilize the data described in Section 148.120(c) and received in compliance with Section 148.120(f). Effective for Medicaid Percentage rate year 2027 and thereafter, the Medicaid Inpatient utilization rate, as defined in Section 148.120(i)(4) and used in the determination of eligibility for payments under subsection (d) and safety net determination in 305 ILCS 5/5-5e.1, shall be modified to exclude from both the numerator and denominator, all days of care funded by the U.S. Department of Veterans Affairs at a hospital approved to conduct its operations from more than one location within contiguous counties under a single license, if at the time of its licensing application the hospital was located in a county with fewer than 125,000 inhabitants and the hospital's second facility is located in a contiguous county with fewer than 235,000 inhabitants. 3) In making the determination described in subsections (a)(1), the Department shall utilize the data described in Section 148.120(c) and DEPARTMENT OF HEALTHCARE AND FAMILY SERVICES NOTICE OF PROPOSED AMENDMENTS received in compliance with Section 148.120(f). Effective for Medicaid Percentage rate year 2027 and thereafter, for freestanding psychiatric hospitals as defined in 148.25(d)(1), the Medicaid Inpatient utilization rate, as defined in Section 148.120(i)(4) and used in the determination of eligibility for payments under subsection (d), shall be modified to exclude from both the numerator and denominator, all days reimbursed by the Department of Human Services for mental health services provided under 725 ILCS 5/104-17 of the Code of Criminal Procedure of 1963 as contracted by the Department of Human Services. c) Hospitals that qualified as an MPA hospital under subsection (a)(2) for the Medicaid percentage determination year beginning October 1, 2013 may apply annually to become qualified under subsection (a)(2) by submitting audited certified financial statements as described in Section 148.120(d) and received in compliance with Section 148.120(f). d) Medicaid Percentage Adjustments. The adjustment payments required by subsection (a) for qualified hospitals shall be calculated annually as follows for hospitals defined in Section 148.25(b)(1), excluding hospitals defined in Section 148.25(a). 1) The payment adjustment shall be calculated based upon the hospital's MIUR, as defined in Section 148.120(i)(4), and subject to subsection (e), as follows: A) Hospitals with an MIUR below the mean Medicaid inpatient utilization rate shall receive a payment adjustment of $25; B) Hospitals with an MIUR that is equal to or greater than the mean Medicaid inpatient utilization rate but less than one standard deviation above the mean Medicaid inpatient utilization rate shall receive a payment adjustment of $25 plus $1 for each one percent that the hospital's MIUR exceeds the mean Medicaid inpatient utilization rate; C) Hospitals with an MIUR that is equal to or greater than one standard deviation above the mean Medicaid inpatient utilization rate but less than 1.5 standard deviations above the mean Medicaid inpatient utilization rate shall receive a payment adjustment of $40 DEPARTMENT OF HEALTHCARE AND FAMILY SERVICES NOTICE OF PROPOSED AMENDMENTS plus $7 for each one percent that the hospital's MIUR exceeds one standard deviation above the mean Medicaid inpatient utilization rate; and D) Hospitals with an MIUR that is equal to or greater than 1.5 standard deviations above the mean Medicaid inpatient utilization rate shall receive a payment adjustment of $90 plus $2 for each one percent that the hospital's MIUR exceeds 1.5 standard deviations above the mean Medicaid inpatient utilization rate. E) Hospitals that reopen a previously closed hospital facility within 4 calendar years of the hospital facility's closure, if the previously closed hospital facility qualified for payments under subsection (d) at the time of closure, shall receive the rate in place at the time of the closure until utilization data for the new facility is available for the Medicaid inpatient utilization rate calculation. 2) The MPA payment, calculated in accordance with this subsection (d), to a hospital shall not exceed $155 per day for a children's hospital, as defined in Section 148.25(d)(3), and shall not exceed $215 per day for all other hospitals. 3) The amount calculated pursuant to subsections (d)(1) through (d)(2) shall be adjusted by the aggregate annual increase in the national hospital market basket price proxies (DRI) hospital cost index from DSH determination year 1993, as defined in Section 148.120(i)(2), through DSH determination year 2003 and annually thereafter, by a percentage equal to the lesser of: A) The increase in the national hospital market basket price proxies (DRI) hospital cost index for the most recent 12 month period for which data are available; or B) The percentage increase in the Statewide average hospital payment rate, over the previous year's Statewide average hospital payment rate. 4) The amount calculated pursuant to subsections (d)(1) through (d)(3) shall be the inpatient payment adjustment in dollars for the applicable Medicaid DEPARTMENT OF HEALTHCARE AND FAMILY SERVICES NOTICE OF PROPOSED AMENDMENTS percentage determination year. The adjustments calculated under subsections (d)(1) through (d)(3) shall be paid on a per diem basis and, except as provided in subsection (d)(5), shall be applied to each covered day of care provided. 5) Covered days associated with claims for normal newborn DRGs 626 or 640 are not eligible for the MPA adjustment or the per diem payments on adjustments calculated under subsections (d)(1) through (d)(3). e) Inpatient Adjustor for Children's Hospitals. For a children's hospital, as defined in Section 148.25(d)(3), the payment adjustment calculated under subsection (d)(1) shall be multiplied by 2.0. f) Medicaid Percentage Adjustment Limitations 1) In addition, to be deemed an MPA hospital, a hospital must provide to the Department, in writing, the names of at least two obstetricians with staff privileges at the hospital who have agreed to provide obstetric services to individuals entitled to such services under a State Medicaid plan. In the case of a hospital located in a rural area (that is, an area outside of a Metropolitan Statistical Area, as defined by the federal Executive Office of Management and Budget), the term "obstetrician" includes any physician with staff privileges to perform obstetric services at the hospital. This requirement for obstetric services does not apply to a hospital: A) In which the inpatients are predominantly individuals under 18 years of age; B) That does not offer non-emergency obstetric services as of December 22, 1987; or C) That was providing obstetric services prior to February 1, 2019 and discontinues obstetric services after February 1, 2019 and is located within 15 miles of a hospital that continues to provide obstetric services at the time of discontinuation. Hospitals that do not offer obstetric services to the general public, with the exception of those hospitals described in Section 148.25(d), must submit a statement to that effect that includes the date obstetric services were discontinued. 2) Hospitals that qualify for MPAs under this Section shall not be eligible for the total MPA if, during the MPA determination year, the hospital discontinues provision of obstetric services. The provisions of this subsection (f)(2) shall not apply to those hospitals described in Section 148.25(d) or those hospitals that have not offered obstetric services as of December 22, 1987, or those hospitals that discontinue obstetric services after February 1, 2019 and are located within 15 miles of a hospital that continues to provide obstetric services at the time of discontinuation. In this instance, the adjustments calculated under subsection (d) shall cease to be effective on the date that the hospital discontinued the provision of obstetric services. 3) Appeals based upon a hospital's ineligibility for Medicaid Percentage payment adjustments, or their payment adjustment amounts, in accordance with Section 148.310(b), that result in a change in a hospital's eligibility for Medicaid Percentage payment adjustments or a change in a hospital's payment adjustment amounts, shall not affect the Medicaid Percentage status of any other hospital or the payment adjustment amount of any other hospital that has received notification from the Department of its eligibility for Medicaid Percentage payment adjustments based upon the requirements of this Section. 4) Medicaid Inpatient Utilization Rate Limit. Hospitals that qualify for Medicaid percentage payment adjustments under this Section shall not be eligible for Medicaid percentage payment adjustments if the hospital's MIUR, as defined in Section 148.120(i)(4), is less than one percent. g) Inpatient Payment Adjustment Definitions. The definitions of terms used with reference to calculation of Inpatient Payment Adjustments are as follows: 1) "Medicaid Percentage determination year" has the same meaning as the DSH determination year defined in Section 148.120(i)(2), except that: A) The Medicaid Percentage determination year that begins on October 1, 2022 will end on December 31, 2023; and B) Effective January 1, 2024, Medicaid Percentage determination years will begin on January 1 and end on December 31. 2) "Mean Medicaid obstetrical inpatient utilization rate" means a fraction, the numerator of which is the total Medicaid (Title XIX) obstetrical inpatient days, as defined in subsection (g)(4), provided by all Medicaid- participating Illinois hospitals providing obstetrical services to patients who, for such days, were eligible for Medicaid under Title XIX of the federal Social Security Act (42 U.S.C. 1396a), and the denominator of which is the total Medicaid inpatient days, as defined in subsection (g), for all such hospitals. That information shall be derived from claims for applicable services provided in the Medicaid obstetrical inpatient utilization rate base year that were subsequently adjudicated by the Department through the last day of June preceding the Medicaid percentage determination year and contained within the Department's paid claims data base. 3) "Medicaid obstetrical inpatient utilization rate" means a fraction, the numerator of which is the Medicaid (Title XIX) obstetrical inpatient days, as defined in subsection (g)(4), provided by a Medicaid-participating Illinois hospital providing obstetrical services to patients who, for such days, were eligible for Medicaid under Title XIX of the federal Social Security Act (42 U.S.C. 1396a), and the denominator of which is the total Medicaid (Title XIX) inpatient days, as defined in subsection (g), provided by such hospital. This information shall be derived from claims for applicable services provided in the Medicaid obstetrical inpatient utilization rate base year that were subsequently adjudicated by the Department through the last day of June preceding the Medicaid Percentage determination year and contained within the Department's paid claims data base. 4) "Medicaid (Title XIX) obstetrical inpatient days" means hospital inpatient days that were subsequently adjudicated by the Department through the last day of June preceding the MPA determination year and contained within the Department's paid claims data base, for recipients of medical assistance under Title XIX of the Social Security Act (specifically excluding Medicare/Medicaid crossover claims), with a Diagnosis Related Grouping (DRG) of: A) 370 through 375 for claims adjudicated before July 1, 2014; or DEPARTMENT OF HEALTHCARE AND FAMILY SERVICES NOTICE OF PROPOSED AMENDMENTS B) 540, 541, 542 or 560 for claims adjudicated on or after July 1, 2014. 5) "Total Medicaid (Title XIX) inpatient days", as referred to in subsections (g)(2) and (g)(3), means hospital inpatient days, excluding days for normal newborns, that were subsequently adjudicated by the Department through the last day of June preceding the Medicaid Percentage determination year and contained within the Department's paid claims data base, for recipients of medical assistance under Title XIX of the Social Security Act, and specifically excludes Medicare/Medicaid crossover claims. 6) "Medicaid obstetrical inpatient utilization rate base year" means, for example, fiscal year 2002 for the October 1, 2003 MPA determination year; fiscal year 2003 for the October 1, 2004 MPA determination year; etc. 7) "Obstetric services" shall at a minimum include non-emergency inpatient deliveries in the hospital. (Source: Amended at 50 Ill. Reg. ______, effective ____________)