BILL REQ. #: Z-1172.1
| State of Washington | 61st Legislature | 2010 Regular Session |
Read first time 01/25/10. Referred to Committee on Ways & Means.
AN ACT Relating to a hospital safety net assessment for increased hospital payments to improve health care access for the citizens of Washington; amending 2009 c 564 s 209 (uncodified); adding a new chapter to Title 74 RCW; providing an expiration date; and declaring an emergency.
BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF WASHINGTON:
NEW SECTION. Sec. 1
(2) The legislature finds that:
(a) Washington hospitals, working with the department of social and
health services, have proposed a hospital safety net assessment to
generate additional state and federal funding for the medicaid program,
which will be used to partially restore recent reductions in hospital
reimbursement payments and provide for an increase in hospital
reimbursement rates; and
(b) The hospital safety net assessment and hospital safety net
assessment fund created in this chapter allows the state to generate
additional federal financial participation for the medicaid program and
provides for increased reimbursement to hospitals.
(3) In adopting this chapter, it is the intent of the legislature:
(a) To impose a hospital safety net assessment to be used solely
for the purposes specified in this chapter;
(b) That funds generated by the assessment shall be used solely to
augment all other funding sources and not as a substitute for any other
funds;
(c) That the total amount assessed not exceed the amount needed, in
combination with all other available funds, to support the
reimbursement rates and other payments authorized by this chapter; and
(d) To condition the assessment on receiving federal approval for
receipt of additional federal financial participation and on
continuation of other funding sufficient to maintain hospital
reimbursement rates and small rural disproportionate share payments at
least at the levels in effect on June 30, 2009.
NEW SECTION. Sec. 2
(1) "Certified public expenditure hospital" means a hospital
participating in the department's certified public expenditure payment
program as described in WAC 388-550-4650 or successor rule.
(2) "Critical access hospital" means a hospital as described in RCW
74.09.5225.
(3) "Date of expiration of section 5001 of P.L. No. 111-5" means
December 31, 2010, or any subsequent date declared by congress to be
the termination date of the temporary increase in the federal medical
assistance percentage currently set forth in section 5001 of P.L. No.
111-5.
(4) "Department" means the department of social and health
services.
(5) "Fund" means the hospital safety net assessment fund
established under section 3 of this act.
(6) "Hospital" means a facility licensed under chapter 70.41 RCW.
(7) "Long-term acute care hospital" means a hospital which has an
average inpatient length of stay of greater than twenty-five days as
determined by the department of health.
(8) "Managed care organization" means an organization having a
certificate of authority or certificate of registration from the office
of the insurance commissioner that contracts with the department under
a comprehensive risk contract to provide prepaid health care services
to eligible clients under the department's managed care programs.
Managed care organizations include the healthy options program.
(9) "Medicaid" means the medical assistance program as established
in Title XIX of the social security act and as administered in the
state of Washington by the department of social and health services.
(10) "Medicare cost report" means the medicare cost report, form
2552-96, or successor document.
(11) "Nonmedicare hospital inpatient day" means total hospital
inpatient days less medicare inpatient days, including medicare days
reported for medicare managed care plans, as reported on the medicare
cost report, form 2552-96, or successor forms, excluding all skilled
and nonskilled nursing facility days, skilled and nonskilled swing bed
days, nursery days, observation bed days, hospice days, home health
agency days, and other days not typically associated with an acute care
inpatient hospital stay.
(12) "Prospective payment system hospital" means a hospital
reimbursed for inpatient and outpatient services provided to medicaid
beneficiaries under the inpatient prospective payment system and the
outpatient prospective payment system as defined in WAC 388-550-1050.
For purposes of this chapter, prospective payment system hospital does
not include a hospital participating in the certified public
expenditure program or a bordering city hospital located outside of the
state of Washington and in one of the bordering cities listed in WAC
388-501-0175 or successor regulation.
(13) "Psychiatric hospital" means a hospital facility licensed as
a psychiatric hospital under chapter 71.12 RCW.
(14) "Rehabilitation hospital" means a medicare-certified
freestanding inpatient rehabilitation facility.
(15) "Secretary" means the secretary of the department of social
and health services.
(16) "Small rural disproportionate share hospital payment" means a
payment made in accordance with WAC 388-550-5200 or subsequently filed
regulation.
NEW SECTION. Sec. 3
(a) Any unexpended balance in the fund at the end of a fiscal
biennium shall carry over into the following biennium and shall be
applied to reduce the amount of the assessment under section 6(1)(c) of
this act.
(b) Any amounts remaining in the fund on July 1, 2013, shall be
used to make increased payments in accordance with sections 10 and 13
of this act for any outstanding claims with dates of service prior to
July 1, 2013. Any amounts remaining in the fund after such increased
payments are made shall be refunded to hospitals, pro rata according to
the amount paid by the hospital, subject to the limitations of federal
law.
(2) All assessments, interest, and penalties collected by the
department under section 4 of this act shall be deposited into the
fund. All interest earned on moneys in the fund shall be credited to
the fund and used for purposes specified under this chapter.
(3) Disbursements from the fund may be made only as follows:
(a) Subject to appropriations and the continued availability of
other funds in an amount sufficient to maintain the level of medicaid
hospital rates in effect on July 1, 2009;
(b) Upon certification by the secretary that the conditions set
forth in section 15(1) of this act have been met with respect to the
assessments imposed under section 4(1) of this act, the payments
provided under section 9 of this act, and any retroactive payment under
sections 10, 11, 12, and 13 of this act, funds shall be disbursed in
the amount necessary to make the payments specified in those sections;
(c) Upon certification by the secretary that the conditions set
forth in section 15(1) of this act have been met with respect to the
assessments imposed under section 4(2) of this act and the payments
provided under sections 10, 11, 12, and 13 of this act, funds shall be
disbursed periodically as necessary to make the payments as specified
in those sections;
(d) To refund erroneous or excessive payments made by hospitals
pursuant to this chapter;
(e) The sum of thirty-two million dollars per biennium may be
disbursed for the purpose of ensuring that no reductions in hospital
payment rates take place from the effective date of this act until July
1, 2013;
(f) The sum of one million dollars per biennium may be disbursed
for payment of administrative expenses incurred by the department in
performing the activities authorized by this chapter;
(g) To repay the federal government for any excess payments made to
hospitals from the fund if the assessments or payment increases set
forth in this chapter are deemed out of compliance with federal
regulations and all appeals have been exhausted. In such a case, the
department may require hospitals receiving excess payments to refund
the payments in question to the fund. The state in turn shall return
funds to the federal government in the same proportion as the original
financing. If a hospital is unable to refund payments, the state shall
develop a payment plan and/or deduct moneys from future medicaid
payments.
NEW SECTION. Sec. 4
(a) Prospective payment system hospitals.
(i) Each prospective payment system hospital shall pay an
assessment of thirty dollars for each annual nonmedicare hospital
inpatient day up to sixty thousand per year, multiplied by 0.59.
(ii) Each prospective payment system hospital shall pay an
assessment of two dollars for each annual nonmedicare hospital
inpatient day over and above sixty thousand per year, multiplied by
0.59.
(b) Each psychiatric hospital shall pay an assessment of six
dollars for each annual nonmedicare hospital inpatient day, multiplied
by 0.59.
(c) Each rehabilitation hospital shall pay an assessment of six
dollars for each annual nonmedicare hospital inpatient day, multiplied
by 0.59.
(d) Each critical access hospital shall pay an assessment of ten
dollars for each annual nonmedicare hospital inpatient day, multiplied
by 0.59.
(e) For purposes of this subsection, the department shall determine
each hospital's annual nonmedicare hospital inpatient days by summing
the total reported nonmedicare inpatient days for each hospital that is
not exempt from the assessment as described in section 5 of this act
for the relevant state fiscal year 2008 portions included in the
hospital's fiscal year end reports 2007 and/or 2008 cost reports. The
department shall use nonmedicare hospital inpatient day data for each
hospital taken from the centers for medicare and medicaid services'
hospital 2552-96 cost report data file as of November 30, 2009, or
equivalent data collected by the department.
(2) For the period February 1, 2010, through July 1, 2013, an
assessment is imposed as follows, which shall be due and payable on the
first day of each calendar quarter, provided that the department has
sent notice of the assessment to each affected hospital at least thirty
days prior to the due date for the assessment payment, and provided
that the applicable conditions established by section 15(1) of this act
have been satisfied. In the event that the applicable conditions in
section 15(1) of this act have not been met, the department shall delay
the initial due date for the assessment imposed under this subsection
until such conditions have been met, at which time all amounts payable
under this subsection to date are due.
(a) For the period February 1, 2010, through the day prior to the
date of expiration of section 5001 of P.L. No. 111-5:
(i) Prospective payment system hospitals.
(A) Each prospective payment system hospital shall pay an
assessment of one hundred thirty dollars for each annual nonmedicare
hospital inpatient day up to sixty thousand per year, multiplied by the
number of days in the assessment period divided by three hundred sixty-five.
(B) Each prospective payment system hospital shall pay an
assessment of nine dollars for each annual nonmedicare hospital
inpatient day over and above sixty thousand per year, multiplied by the
number of days in the assessment period divided by three hundred sixty-five.
(ii) Each psychiatric hospital shall pay an assessment of twenty-four dollars for each annual nonmedicare hospital inpatient day,
multiplied by the number of days in the assessment period divided by
three hundred sixty-five.
(iii) Each rehabilitation hospital shall pay an assessment of
twenty-four dollars for each annual nonmedicare hospital inpatient day,
multiplied by the number of days in the assessment period divided by
three hundred sixty-five.
(iv) Each critical access hospital shall pay an assessment of ten
dollars for each annual nonmedicare hospital inpatient day, multiplied
by the number of days in the assessment period divided by three hundred
sixty-five.
(v) For purposes of this subsection, the department shall determine
each hospital's annual nonmedicare hospital inpatient days by summing
the total reported nonmedicare inpatient days for each hospital that is
not exempt from the assessment as described in section 5 of this act
for the relevant state fiscal year 2008 portions included in the
hospital's fiscal year end reports 2007 and/or 2008 cost reports. The
department shall use nonmedicare hospital inpatient day data for each
hospital taken from the centers for medicare and medicaid services'
hospital 2552-96 cost report data file as of November 30, 2009, or
equivalent data collected by the department.
(b) For the period beginning on the date of expiration of section
5001 of P.L. No. 111-5 through June 30, 2011:
(i) Prospective payment system hospitals.
(A) Each prospective payment system hospital shall pay an
assessment of one hundred sixty-four dollars for each annual
nonmedicare inpatient day up to sixty thousand per year, multiplied by
the number of days in the assessment period divided by three hundred
sixty-five.
(B) Each prospective payment system hospital shall pay an
assessment of eleven dollars for each annual nonmedicare inpatient day
over and above sixty thousand per year, multiplied by the number of
days in the assessment period divided by three hundred sixty-five. The
department may adjust the assessment downward if necessary to maintain
compliance with federal regulations related to medicaid program health
care-related taxes.
(ii) Each psychiatric hospital shall pay an assessment of thirty
dollars for each annual nonmedicare hospital inpatient day, multiplied
by the number of days in the assessment period divided by three hundred
sixty-five.
(iii) Each rehabilitation hospital shall pay an assessment of
thirty dollars for each annual nonmedicare hospital inpatient day,
multiplied by the number of days in the assessment period divided by
three hundred sixty-five.
(iv) Each critical access hospital shall pay an assessment of ten
dollars for each annual nonmedicare hospital inpatient day, multiplied
by the number of days in the assessment period divided by three hundred
sixty-five.
(v) For purposes of this subsection, the department shall determine
each hospital's annual nonmedicare hospital inpatient days by summing
the total reported nonmedicare hospital inpatient days for each
hospital that is not exempt from the assessment under section 5 of this
act, taken from the most recent publicly available hospital 2552-96
cost report data file or successor data file available through the
centers for medicare and medicaid services, as of a date to be
determined by the department. If cost report data are unavailable from
the foregoing source for any hospital subject to the assessment, the
department shall collect such information directly from the hospital.
(c) For the period beginning July 1, 2011, through July 1, 2013:
(i) Prospective payment system hospitals.
(A) Each prospective payment system hospital shall pay an
assessment of one hundred seventy-four dollars for each annual
nonmedicare hospital inpatient day up to sixty thousand per year,
multiplied by the number of days in the assessment period divided by
three hundred sixty-five.
(B) Each prospective payment system hospital shall pay an
assessment of twelve dollars for each annual nonmedicare inpatient day
over and above sixty thousand per year, multiplied by the number of
days in the assessment period divided by three hundred sixty-five. The
department may adjust the assessment downward if necessary to maintain
compliance with federal regulations related to medicaid program health
care-related taxes.
(ii) Each psychiatric hospital shall pay an assessment of thirty
dollars for each annual nonmedicare inpatient day, multiplied by the
number of days in the assessment period divided by three hundred sixty-five.
(iii) Each rehabilitation hospital shall pay an assessment of
thirty dollars for each annual nonmedicare inpatient day, multiplied by
the number of days in the assessment period divided by three hundred
sixty-five.
(iv) Each critical access hospital shall pay an assessment of ten
dollars for each annual nonmedicare inpatient day, multiplied by the
number of days in the assessment period divided by three hundred sixty-five.
(v) For purposes of this subsection, the department shall determine
each hospital's annual nonmedicare hospital inpatient days by summing
the total reported nonmedicare hospital inpatient days for each
hospital that is not exempt from the assessment under section 5 of this
act, taken from the most recent publicly available hospital 2552-96
cost report data file or successor data file available through the
centers for medicare and medicaid services, as of a date to be
determined by the department. If cost report data are unavailable
from the foregoing source for any hospital subject to the assessment,
the department shall collect such information directly from the
hospital.
NEW SECTION. Sec. 5
(1) Hospitals owned or operated by an agency of federal or state
government, including but not limited to western state hospital and
eastern state hospital;
(2) Washington public hospitals that participate in the certified
public expenditure program;
(3) Hospitals that do not charge directly or indirectly for
hospital services; and
(4) Long-term acute care hospitals.
NEW SECTION. Sec. 6
(a) Transmittal of quarterly notices of assessment by the
department to each hospital informing the hospital of its nonmedicare
hospital inpatient days and the assessment amount due and payable.
Such quarterly notices shall be sent to each hospital at least thirty
days prior to the due date for the quarterly assessment payment.
(b) Interest on delinquent assessments at the rate specified in RCW
82.32.050.
(c) Adjustment of the assessment amounts as follows:
(i) For each fiscal year beginning July 1, 2010, the assessment
amounts under section 4(2) of this act may be adjusted as follows:
(A) If sufficient other funds, including any increase in federal
financial participation in addition to what is provided under section
5001 of P.L. No. 111-5, are available to support the increased
reimbursement rates and other payments under sections 10, 11, 12, and
13 of this act without utilizing the full assessment authorized under
section 4(2) of this act, the department shall reduce the amount of the
assessment for prospective payment system, psychiatric, and
rehabilitation hospitals proportionately to the minimum level necessary
to support those reimbursement rates and other payments.
(B) Provided that none of the conditions set forth in section 15(2)
of this act have occurred, if the department's forecasts indicate that
the assessment amounts under section 4(2) of this act, together with
all other available funds, are not sufficient to support the increased
reimbursement rates and other payments under sections 10, 11, 12, and
13 of this act, the department shall increase the assessment rates for
prospective payment system, psychiatric, and rehabilitation hospitals
proportionately to the amount necessary to support those reimbursement
rates and other payments, plus a contingency factor up to ten percent
of the total assessment amount.
(C) Any positive balance remaining in the fund at the end of the
fiscal year shall be applied to reduce the assessment amount for the
subsequent fiscal year.
(ii) Any adjustment to the assessment amounts pursuant to this
subsection, and the data supporting such adjustment, including but not
limited to relevant data listed in subsection (2) of this section, must
be submitted to the Washington state hospital association for review
and comment at least sixty days prior to implementation of such
adjusted assessment amounts. Any review and comment provided by the
Washington state hospital association shall not limit the ability of
the Washington state hospital association or its members to challenge
an adjustment or other action by the department that is not made in
accordance with this chapter.
(2) By November 30th of each year, the department shall provide the
following data to the Washington state hospital association:
(a) The fund balance;
(b) The amount of assessment paid by each hospital;
(c) The annual medicaid fee-for-service payments for inpatient
hospital services and outpatient hospital services; and
(d) The medicaid healthy options inpatient and outpatient payments
as reported by all hospitals to the department on disproportionate
share hospital applications. The department shall amend the
disproportionate share hospital application and reporting instructions
as needed to ensure that the foregoing data is reported by all
hospitals as needed in order to comply with this subsection (2)(d).
(3) The department shall determine the number of nonmedicare
hospital inpatient days for each hospital for each assessment period.
(4) To the extent necessary, the department shall amend the
contracts between the managed care organizations and the department to
incorporate the provisions of section 13 of this act. The department
shall pursue amendments to the contracts as soon as possible after the
effective date of this act. The amendments to the contracts shall,
among other provisions, provide for increased payment rates to managed
care organizations in accordance with section 13 of this act.
NEW SECTION. Sec. 7
NEW SECTION. Sec. 8
NEW SECTION. Sec. 9
(1) Reinstitute the medicaid inpatient rates and outpatient fee
schedule for hospital reimbursement rates in effect on June 30, 2009;
and
(2) Recalculate the amount payable to each hospital that submitted
an otherwise allowable claim for inpatient and outpatient
medicaid-covered services rendered from and after July 1, 2009, up to
and including January 31, 2010, based on the inpatient and outpatient
fee-for-service rates in effect on June 30, 2009, and, within sixty
days after the date upon which the applicable conditions set forth in
section 15(1) of this act have been satisfied, remit the difference to
each hospital.
NEW SECTION. Sec. 10
(a) Prospective payment system hospitals:
(i) Inpatient psychiatric services: Twelve percent;
(ii) Inpatient services: Twelve percent;
(iii) Outpatient services: Thirty-two percent.
(b) Harborview medical center and University of Washington medical
center:
(i) Inpatient psychiatric services: Three percent;
(ii) Inpatient services: Three percent;
(iii) Outpatient services: Twenty-one percent.
(c) Rehabilitation hospitals:
(i) Inpatient services: Twelve percent;
(ii) Outpatient services: Thirty-two percent;
(d) Psychiatric hospitals:
(i) Inpatient psychiatric services: Twelve percent;
(ii) Inpatient services: Twelve percent.
(2) For claims processed for services rendered on or after February
1, 2010, but prior to satisfaction of the applicable conditions
specified in section 15(1) of this act, the department shall, within
sixty days after satisfaction of those conditions, calculate the amount
payable to hospitals in accordance with this section and remit the
difference to each hospital that has submitted an otherwise allowable
claim for payment for such services.
NEW SECTION. Sec. 11
NEW SECTION. Sec. 12
NEW SECTION. Sec. 13
(1) Amend medicaid-managed care contracts as necessary in order to
ensure compliance with this chapter;
(2) Require managed care organizations to pay the full amount of
payments received under this section to hospitals;
(3) With respect to the inpatient and outpatient rates established
by section 9 of this act, within sixty days after satisfaction of the
applicable conditions under section 15(1) of this act, calculate the
additional amount due to each hospital to pay claims submitted for
inpatient and outpatient medicaid-covered services rendered from and
after July 1, 2009, through January 31, 2010, make payments to each
managed care organization in amounts sufficient to pay the additional
amounts due to each hospital, and require managed care organizations to
make payments to hospitals on all previously submitted claims in
accordance with section 9 of this act.
(4) Increase payments to managed care organizations as necessary to
ensure that inpatient and outpatient medicaid reimbursement rates for
hospital services, rendered from and after February 1, 2010, until July
1, 2013 and covered by such managed care organizations, are increased
by the amounts specified in section 10 of this act. The increased
payments made to hospitals pursuant to this subsection shall be in
addition to any other amounts payable to hospitals by a managed care
organization and shall not affect any other payments to hospitals;
(5) With respect to the inpatient and outpatient rates established
by section 10 of this act, within ninety days after satisfaction of the
applicable conditions under section 15(1) of this act, calculate the
additional amount due to each hospital to pay claims submitted for
inpatient and outpatient medicaid-covered services rendered from and
after February 1, 2010, through the date when the applicable conditions
are met, make payments to each managed care organization in amounts
sufficient to pay the additional amounts due to each hospital, and
require managed care organizations to make payments to hospitals on all
previously submitted claims in accordance with section 10 of this act.
(6) Require managed care organizations to demonstrate compliance
with this section, including a requirement that payments due to
hospitals under subsections (3) and (5) of this section be made within
thirty days after the department disburses funds for those purposes.
NEW SECTION. Sec. 14
(2) Notwithstanding any other provision of this chapter, if a
hospital subject to the assessment imposed under this chapter ceases to
conduct hospital operations throughout a state fiscal year, the
assessment for the quarter in which the cessation occurs shall be
adjusted by multiplying the assessment computed under section 4(2) of
this act by a fraction, the numerator of which is the number of days
during the year which the hospital conducts, operates, or maintains the
hospital and the denominator of which is three hundred sixty-five.
Immediately prior to ceasing to conduct, operate, or maintain a
hospital, the hospital shall pay the adjusted assessment for the fiscal
year to the extent not previously paid.
(3) Notwithstanding any other provision of this chapter, in the
case of a hospital that commences conducting, operating, or maintaining
a hospital that is not exempt from payment of the assessment under
section 5 of this act and that did not conduct, operate, or maintain
such hospital throughout the cost reporting year used to determine the
assessment amount, the assessment for that hospital shall be computed
on the basis of the actual number of nonmedicare inpatient days
reported to the department by the hospital on a quarterly basis. The
hospital shall be eligible to receive increased payments under this
chapter beginning on the date it commences hospital operations.
(4) Notwithstanding any other provision of this chapter, if a
hospital previously subject to assessment is sold or transferred to
another entity and remains subject to assessment, the assessment for
that hospital shall be computed based upon the cost report data
previously submitted by that hospital. The assessment shall be
allocated between the transferor and transferee based on the number of
days within the assessment period that each owned, operated, or
maintained the hospital.
NEW SECTION. Sec. 15
(a) Withdrawal of those aspects of any pending state plan
amendments previously submitted to the centers for medicare and
medicaid services that are inconsistent with this chapter;
(b) Approval by the centers for medicare and medicaid services of
any state plan amendments or waiver requests that are necessary in
order to implement the applicable sections of this chapter; and
(c) To the extent necessary, amendment of contracts between the
department and managed care organizations in order to implement this
chapter.
(2) This chapter does not take effect or cease to be imposed, and
any moneys remaining in the fund shall be refunded to hospitals in
proportion to the amounts paid by such hospitals, if and to the extent
that:
(a) An appellate court or the centers for medicare and medicaid
services makes a final determination that any element of this chapter,
other than section 11 of this act, cannot be validly implemented;
(b) Medicaid inpatient or outpatient payment rates for hospitals
are reduced below the aggregate reimbursement rates set forth in this
chapter;
(c) Except for payments to the University of Washington medical
center and harborview medical center payments to hospitals required
under sections 9, 10, 12, and 13 of this act are not eligible for
federal matching funds;
(d) The office of financial management certifies that
appropriations have been adopted that fully support the rates
established in this chapter for the upcoming fiscal year;
(e) If other funding available for the medicaid program is not
sufficient to maintain medicaid inpatient and outpatient reimbursement
rates for hospitals and small rural disproportionate share payments at
one hundred percent of the levels in effect on July 1, 2009; or
(f) If the fund is used as a substitute for or to supplant other
funds.
NEW SECTION. Sec. 16
(2) In the event that any portion of this chapter shall have been
validly implemented and the entire chapter is later rendered
ineffective under this section, prior assessments and payments under
the validly implemented portions shall not be affected.
(3) In the event that the payment under section 11 of this act, or
the application thereof to any hospital or circumstances does not
receive approval by the centers for medicare and medicaid services as
described in section 15(1)(b) of this act or is determined to be
unconstitutional or otherwise invalid, the amount of the assessment
shall be adjusted under section 6(1)(c) of this act.
Sec. 17 2009 c 564 s 209 (uncodified) is amended to read as
follows:
FOR THE DEPARTMENT OF SOCIAL AND HEALTH SERVICES -- MEDICAL ASSISTANCE
PROGRAM
General Fund -- State Appropriation (FY 2010) . . . . . . . . . . . . $1,597,387,000
General Fund -- State Appropriation (FY 2011) . . . . . . . . . . . . $1,984,797,000
General Fund -- Federal Appropriation . . . . . . . . . . . . $5,210,672,000
General Fund -- Private/Local Appropriation . . . . . . . . . . . . $12,903,000
Emergency Medical Services and Trauma Care Systems
Trust Account -- State Appropriation . . . . . . . . . . . . $15,076,000
Tobacco Prevention and Control Account --
State Appropriation . . . . . . . . . . . . $3,766,000
TOTAL APPROPRIATION . . . . . . . . . . . . $8,824,601,000
The appropriations in this section are subject to the following
conditions and limitations:
(1) Based on quarterly expenditure reports and caseload forecasts,
if the department estimates that expenditures for the medical
assistance program will exceed the appropriations, the department shall
take steps including but not limited to reduction of rates or
elimination of optional services to reduce expenditures so that total
program costs do not exceed the annual appropriation authority.
(2) In determining financial eligibility for medicaid-funded
services, the department is authorized to disregard recoveries by
Holocaust survivors of insurance proceeds or other assets, as defined
in RCW 48.104.030.
(3) The legislature affirms that it is in the state's interest for
Harborview medical center to remain an economically viable component of
the state's health care system.
(4) When a person is ineligible for medicaid solely by reason of
residence in an institution for mental diseases, the department shall
provide the person with the same benefits as he or she would receive if
eligible for medicaid, using state-only funds to the extent necessary.
(5) In accordance with RCW 74.46.625, $6,000,000 of the general
fund -- federal appropriation is provided solely for supplemental
payments to nursing homes operated by public hospital districts. The
public hospital district shall be responsible for providing the
required nonfederal match for the supplemental payment, and the
payments shall not exceed the maximum allowable under federal rules.
It is the legislature's intent that the payments shall be supplemental
to and shall not in any way offset or reduce the payments calculated
and provided in accordance with part E of chapter 74.46 RCW. It is the
legislature's further intent that costs otherwise allowable for rate-setting and settlement against payments under chapter 74.46 RCW shall
not be disallowed solely because such costs have been paid by revenues
retained by the nursing home from these supplemental payments. The
supplemental payments are subject to retrospective interim and final
cost settlements based on the nursing homes' as-filed and final
medicare cost reports. The timing of the interim and final cost
settlements shall be at the department's discretion. During either the
interim cost settlement or the final cost settlement, the department
shall recoup from the public hospital districts the supplemental
payments that exceed the medicaid cost limit and/or the medicare upper
payment limit. The department shall apply federal rules for
identifying the eligible incurred medicaid costs and the medicare upper
payment limit.
(6) (($1,110,000 of the general fund -- federal appropriation and
$1,105,000 of the general fund--state appropriation for fiscal year
2011 are provided solely for grants to rural hospitals. The department
shall distribute the funds under a formula that provides a relatively
larger share of the available funding to hospitals that (a) serve a
disproportionate share of low-income and medically indigent patients,
and (b) have relatively smaller net financial margins, to the extent
allowed by the federal medicaid program.)) $9,818,000 of the general fund--state appropriation for
fiscal year 2011, and $9,865,000 of the general fund -- federal
appropriation are provided solely for grants to nonrural hospitals.
The department shall distribute the funds under a formula that provides
a relatively larger share of the available funding to hospitals that
(a) serve a disproportionate share of low-income and medically indigent
patients, and (b) have relatively smaller net financial margins, to the
extent allowed by the federal medicaid program.
(7)
(((8))) (7) The department shall continue the inpatient hospital
certified public expenditures program for the 2009-11 biennium. The
program shall apply to all public hospitals, including those owned or
operated by the state, except those classified as critical access
hospitals or state psychiatric institutions. The department shall
submit reports to the governor and legislature by November 1, 2009, and
by November 1, 2010, that evaluate whether savings continue to exceed
costs for this program. If the certified public expenditures (CPE)
program in its current form is no longer cost-effective to maintain,
the department shall submit a report to the governor and legislature
detailing cost-effective alternative uses of local, state, and federal
resources as a replacement for this program. During fiscal year 2010
and fiscal year 2011, hospitals in the program shall be paid and shall
retain one hundred percent of the federal portion of the allowable
hospital cost for each medicaid inpatient fee-for-service claim payable
by medical assistance and one hundred percent of the federal portion of
the maximum disproportionate share hospital payment allowable under
federal regulations. Inpatient medicaid payments shall be established
using an allowable methodology that approximates the cost of claims
submitted by the hospitals. Payments made to each hospital in the
program in each fiscal year of the biennium shall be compared to a
baseline amount. The baseline amount will be determined by the total
of (a) the inpatient claim payment amounts that would have been paid
during the fiscal year had the hospital not been in the CPE program,
(b) one half of the indigent assistance disproportionate share hospital
payment amounts paid to and retained by each hospital during fiscal
year 2005, and (c) all of the other disproportionate share hospital
payment amounts paid to and retained by each hospital during fiscal
year 2005 to the extent the same disproportionate share hospital
programs exist in the 2009-11 biennium. If payments during the fiscal
year exceed the hospital's baseline amount, no additional payments will
be made to the hospital except the federal portion of allowable
disproportionate share hospital payments for which the hospital can
certify allowable match. If payments during the fiscal year are less
than the baseline amount, the hospital will be paid a state grant equal
to the difference between payments during the fiscal year and the
applicable baseline amount. Payment of the state grant shall be made
in the applicable fiscal year and distributed in monthly payments. The
grants will be recalculated and redistributed as the baseline is
updated during the fiscal year. The grant payments are subject to an
interim settlement within eleven months after the end of the fiscal
year. A final settlement shall be performed. To the extent that
either settlement determines that a hospital has received funds in
excess of what it would have received as described in this subsection,
the hospital must repay the excess amounts to the state when requested.
$6,570,000 of the general fund-- state appropriation for fiscal year
2010, which is appropriated in section 204(1) of this act, and
$1,500,000 of the general fund--state appropriation for fiscal year
2011, which is appropriated in section 204(1) of this act, are provided
solely for state grants for the participating hospitals. Sufficient
amounts are appropriated in this section for the remaining state grants
for the participating hospitals.
(((9))) (8) The department is authorized to use funds appropriated
in this section to purchase goods and supplies through direct
contracting with vendors when the department determines it is cost-effective to do so.
(((10))) (9) Sufficient amounts are appropriated in this section
for the department to continue podiatry services for medicaid-eligible
adults.
(((11))) (10) Sufficient amounts are appropriated in this section
for the department to provide an adult dental benefit that is at least
equivalent to the benefit provided in the 2003-05 biennium.
(((12))) (11) $93,000 of the general fund--state appropriation for
fiscal year 2010 and $93,000 of the general fund--federal appropriation
are provided solely for the department to pursue a federal Medicaid
waiver pursuant to Second Substitute Senate Bill No. 5945 (Washington
health partnership plan). If the bill is not enacted by June 30, 2009,
the amounts provided in this subsection shall lapse.
(((13))) (12) The department shall require managed health care
systems that have contracts with the department to serve medical
assistance clients to limit any reimbursements or payments the systems
make to providers not employed by or under contract with the systems to
no more than the medical assistance rates paid by the department to
providers for comparable services rendered to clients in the fee-for-service delivery system.
(((14))) (13) Appropriations in this section are sufficient for the
department to continue to fund family planning nurses in the community
services offices.
(((15))) (14) The department, in coordination with stakeholders,
will conduct an analysis of potential savings in utilization of home
dialysis. The department shall present its findings to the appropriate
house of representatives and senate committees by December 2010.
(((16))) (15) A maximum of $166,875,000 of the general fund--state
appropriation and $38,389,000 of the general fund--federal
appropriation may be expended in the fiscal biennium for the general
assistance-unemployable medical program, and these amounts are provided
solely for this program. Of these amounts, $10,749,000 of the general
fund--state appropriation for fiscal year 2010 and $10,892,000 of the
general fund--federal appropriation are provided solely for payments to
hospitals for providing outpatient services to low income patients who
are recipients of general assistance-unemployable. Pursuant to RCW
74.09.035, the department shall not expend for the general assistance
medical care services program any amounts in excess of the amounts
provided in this subsection.
(((17))) (16) If the department determines that it is feasible
within the amounts provided in subsection (((16))) (15) of this
section, and without the loss of federal disproportionate share
hospital funds, the department shall contract with the carrier
currently operating a managed care pilot project for the provision of
medical care services to general assistance-unemployable clients.
Mental health services shall be included in the services provided
through the managed care system. If the department determines that it
is feasible, effective October 1, 2009, in addition to serving clients
in the pilot counties, the carrier shall expand managed care services
to clients residing in at least the following counties: Spokane,
Yakima, Chelan, Kitsap, and Cowlitz. If the department determines that
it is feasible, the carrier shall complete implementation into the
remaining counties. Total per person costs to the state, including
outpatient and inpatient services and any additional costs due to stop
loss agreements, shall not exceed the per capita payments projected for
the general assistance-unemployable eligibility category, by fiscal
year, in the February 2009 medical assistance expenditures forecast.
The department, in collaboration with the carrier, shall seek to
improve the transition rate of general assistance clients to the
federal supplemental security income program.
(((18))) (17) The department shall evaluate the impact of the use
of a managed care delivery and financing system on state costs and
outcomes for general assistance medical clients. Outcomes measured
shall include state costs, utilization, changes in mental health status
and symptoms, and involvement in the criminal justice system.
(((19))) (18) The department shall report to the governor and the
fiscal committees of the legislature by June 1, 2010, on its progress
toward achieving a twenty percentage point increase in the generic
prescription drug utilization rate.
(((20))) (19) State funds shall not be used by hospitals for
advertising purposes.
(((21))) (20) The department shall seek a medicaid state plan
amendment to create a professional services supplemental payment
program for University of Washington medicine professional providers no
later than July 1, 2009. The department shall apply federal rules for
identifying the shortfall between current fee-for-service medicaid
payments to participating providers and the applicable federal upper
payment limit. Participating providers shall be solely responsible for
providing the local funds required to obtain federal matching funds.
Any incremental costs incurred by the department in the development,
implementation, and maintenance of this program will be the
responsibility of the participating providers. Participating providers
will retain the full amount of supplemental payments provided under
this program, net of any potential costs for any related audits or
litigation brought against the state. The department shall report to
the governor and the legislative fiscal committees on the prospects for
expansion of the program to other qualifying providers as soon as
feasibility is determined but no later than December 31, 2009. The
report will outline estimated impacts on the participating providers,
the procedures necessary to comply with federal guidelines, and the
administrative resource requirements necessary to implement the
program. The department will create a process for expansion of the
program to other qualifying providers as soon as it is determined
feasible by both the department and providers but no later than June
30, 2010.
(((22))) (21) $9,350,000 of the general fund--state appropriation
for fiscal year 2010, $8,313,000 of the general fund--state
appropriation for fiscal year 2011, and $20,371,000 of the general
fund--federal appropriation are provided solely for development and
implementation of a replacement system for the existing medicaid
management information system. The amounts provided in this subsection
are conditioned on the department satisfying the requirements of
section 902 of this act.
(((23))) (22) $506,000 of the general fund--state appropriation for
fiscal year 2011 and $657,000 of the general fund--federal
appropriation are provided solely for the implementation of Second
Substitute House Bill No. 1373 (children's mental health). If the bill
is not enacted by June 30, 2009, the amounts provided in this
subsection shall lapse.
(((24))) (23) Pursuant to 42 U.S.C. Sec. 1396(a)(25), the
department shall pursue insurance claims on behalf of medicaid children
served through its in-home medically intensive child program under WAC
388-551-3000. The department shall report to the Legislature by
December 31, 2009, on the results of its efforts to recover such
claims.
(((25))) (24) The department may, on a case-by-case basis and in
the best interests of the child, set payment rates for medically
intensive home care services to promote access to home care as an
alternative to hospitalization. Expenditures related to these
increased payments shall not exceed the amount the department would
otherwise pay for hospitalization for the child receiving medically
intensive home care services.
(((26))) (25) $425,000 of the general fund--state appropriation
for fiscal year 2010, $425,000 of the general fund--state appropriation
for fiscal year 2011, and $1,580,000 of the general fund--federal
appropriation are provided solely to continue children's health
coverage outreach and education efforts under RCW 74.09.470. These
efforts shall rely on existing relationships and systems developed with
local public health agencies, health care providers, public schools,
the women, infants, and children program, the early childhood education
and assistance program, child care providers, newborn visiting nurses,
and other community-based organizations. The department shall seek
public- private partnerships and federal funds that are or may become
available to provide on-going support for outreach and education
efforts under the federal children's health insurance program
reauthorization act of 2009.
(((27) The department, in conjunction with the office of financial
management, shall reduce outpatient and inpatient hospital rates and
implement a prorated inpatient payment policy. In determining the
level of reductions needed, the department shall include in its
calculations services paid under fee-for-service, managed care, and
certified public expenditure payment methods; but reductions shall not
apply to payments for psychiatric inpatient services or payments to
critical access hospitals.)) (26) The department will pursue a competitive procurement
process for antihemophilic products, emphasizing evidence-based
medicine and protection of patient access without significant
disruption in treatment.
(28)
(((29))) (27) The department will pursue several strategies towards
reducing pharmacy expenditures including but not limited to increasing
generic prescription drug utilization by 20 percentage points and
promoting increased utilization of the existing mail-order pharmacy
program.
(((30))) (28) The department shall reduce reimbursement for over-the-counter medications while maintaining reimbursement for those over-the-counter medications that can replace more costly prescription
medications.
(((31))) (29) The department shall seek public-private partnerships
and federal funds that are or may become available to implement health
information technology projects under the federal American recovery and
reinvestment act of 2009.
(((32))) (30) The department shall target funding for maternity
support services towards pregnant women with factors that lead to
higher rates of poor birth outcomes, including hypertension, a preterm
or low birth weight birth in the most recent previous birth, a
cognitive deficit or developmental disability, substance abuse, severe
mental illness, unhealthy weight or failure to gain weight, tobacco
use, or African American or Native American race.
(((33))) (31) The department shall direct graduate medical
education funds to programs that focus on primary care training.
(((34))) (32) $79,000 of the general fund--state appropriation for
fiscal year 2010 and $53,000 of the general fund--federal appropriation
are provided solely to implement Substitute House Bill No. 1845
(medical support obligations).
(((35))) (33) $63,000 of the general fund--state appropriation for
fiscal year 2010, $583,000 of the general fund--state appropriation for
fiscal year 2011, and $864,000 of the general fund--federal
appropriation are provided solely to implement Engrossed House Bill No.
2194 (extraordinary medical placement for offenders). The department
shall work in partnership with the department of corrections to
identify services and find placements for offenders who are released
through the extraordinary medical placement program. The department
shall collaborate with the department of corrections to identify and
track cost savings to the department of corrections, including medical
cost savings, and to identify and track expenditures incurred by the
aging and disability services program for community services and by the
medical assistance program for medical expenses. A joint report
regarding the identified savings and expenditures shall be provided to
the office of financial management and the appropriate fiscal
committees of the legislature by November 30, 2010. If this bill is
not enacted by June 30, 2009, the amounts provided in this subsection
shall lapse.
(((36))) (34) Sufficient amounts are provided in this section to
provide full benefit dual eligible beneficiaries with medicare part D
prescription drug copayment coverage in accordance with RCW 74.09.520.
NEW SECTION. Sec. 18
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NEW SECTION. Sec. 20