LEGISLATIVE COUNSEL'S DIGEST
AB 1383, as amended, Jones. Medi-Cal: hospital payments: quality
assurance fees.
Existing law establishes the Medi-Cal program, administered by the
State Department of Health Care Services, under which basic health
care services are provided to qualified low-income persons. The
Medi-Cal program is partially governed and funded as part of the
federal Medicaid Program. Under existing law, the Medi-Cal
Hospital/Uninsured Care Demonstration Project Act, specified hospital
reimbursement methodologies are applied in order to maximize the use
of federal funds consistent with federal Medicaid law and stabilize
the distribution of funding for hospitals that provide care to
Medi-Cal beneficiaries and uninsured patients.
This bill would require the department to make supplemental
payments for certain services, as specified, to private hospitals,
nondesignated public hospitals, and designated public hospitals, as
defined, for subject federal fiscal years, which this bill would
define to mean federal fiscal years that end after the latest
effective date all federal approvals or waivers necessary for the
implementation of these supplemental payments and begin before
December 31, 2010. This bill would also require the department to pay
direct grants in support of health care expenditures to designated
public hospitals for each subject federal fiscal year, as specified.
This bill would require the department to make enhanced payments
to managed health care plans, as defined, and would require the state
to make enhanced payments to mental health plans, as defined, for
each subject federal fiscal year, as specified. This bill would
require the managed health care plans and mental health plans that
received enhanced payments to make supplemental payments to subject
hospitals, as defined, pursuant to specified formulas.
This bill would provide that the above-described payments shall be
made only from the quality assurance fee that is due and payable on
or before December 31, 2010, and related matching federal funds.
This bill would require the Director of Health Care Services to
submit any state plan amendment or waiver request that may be
necessary to implement the above provisions.
This bill would provide for the imposition, as a condition of
participation in state-funded health insurance programs, other than
the Medi-Cal program, of a quality assurance fee, as specified, on
certain general acute care hospitals through, and including, December
31, 2010. This bill would require the department to seek federal
approval, as defined, for assessment of the fee.
This bill would provide that no hospital shall be required to pay
the quality assurance fee to the department unless and until the
state receives and maintains federal approval of the quality
assurance fee for the above-described additional payments from the
federal Centers for Medicare and Medicaid Services (CMS). The bill
would require hospitals, for calendar quarters prior to federal
approval of the fee, and in the calendar quarter in which the
department receives notice of federal approval of the fee, to certify
to the best of its knowledge, on a form provided by the department,
that the hospital is prepared to pay the fee. The bill would provide
that within 30 days of when federal approval is received, the
hospitals shall pay the amount they certified they were prepared to
pay multiplied by certain applicable fee percentages, except that, in
the event that the director has made modifications to the fee model
to secure federal approval, the hospital shall pay the
above-described amount adjusted to reflect the director's
modifications.
This bill would create the Hospital Quality Assurance Revenue Fund
in the State Treasury and require the money collected from the
quality assurance fee be deposited into the fund. This bill would
provide that the moneys in the fund shall, upon appropriation by the
Legislature, be available only for certain purposes, including
providing the above-described supplemental payments and health care
coverage for children.
This bill would appropriate $1,000,000 from the Private Hospital
Supplemental Fund and $1,000,000 from the Federal Trust Fund to the
department to pay the department's staffing and administrative costs
associated with the above-described provisions, including for
workload associated with seeking the necessary federal approvals to
implement the above-described provisions and $13,500,000,000 from the
Hospital Quality Assurance Revenue Fund to the department for the
above-described purposes to be available for expenditure until
January 1, 2013. If the department obtains federal approval, the bill
would require the department to use money in the Hospital Quality
Assurance Revenue Fund to reimburse $1,000,000 to the Private
Hospital Supplemental Fund. If the department does not obtain federal
approval, the bill would require any unexpended moneys from the
$1,000,000 appropriated to the department from the Private Hospital
Supplemental Fund pursuant to this bill to revert to the Private
Hospital Supplemental Fund. This bill would require the department to provide the Joint
Legislative Budget Committee and the fiscal and appropriate policy
committees of the Legislature a status update of the implementation
of the above-described provisions, on January 1, 2010, and quarterly
thereafter.
This bill would provide that the above provisions shall not be
implemented with respect to the 2009-10 and 2010-11 federal fiscal
years until the earlier of April 30, 2010, or the date the federal
government approves a federal waiver for a demonstration that will
replace the Medi-Cal Hospital/Uninsured Care Demonstration Project
Act.
This bill would, under specified conditions, provide that the
above provisions shall become inoperative if, among other things, CMS
denies approval for, or does not approve before January 1, 2012, the
implementation of the above provisions. This bill would, in the
event certain conditions occur, retroactively invalidate the
requirements for supplemental payments or other payments made
pursuant to this bill.
This bill, would specify that a quality assurance fee is to be
imposed pursuant to a subsequent statute, effective January 1, 2011,
and subject to federal approval in a manner necessary to obtain
federal matching funds, that shall be due and payable to the
department by each general acute care hospital at a specified rate
for the purpose of making Medi-Cal payments to hospitals.
This bill would repeal the above provisions on January 1, 2013.
This bill would declare that it is to take effect immediately as
an urgency statute.
Comments/questions on AB 1383 (Jones): Medi-Cal: hospital payments: quality assurance fees.
