ASSEMBLY COMMITTEE SUBSTITUTE FOR
ASSEMBLY, No. 4092
STATE OF NEW JERSEY
ADOPTED JUNE 17, 2013
Assemblywoman L. GRACE SPENCER
District 29 (Essex)
Assemblyman BENJIE E. WIMBERLY
District 35 (Bergen and Passaic)
Assemblywoman CLEOPATRA G. TUCKER
District 28 (Essex)
“Local Hospital Fee Pilot Program Act.”
CURRENT VERSION OF TEXT
As amended by the General Assembly on June 20, 2013.
An Act establishing a “Local Hospital Fee Pilot Program” in the Department of Human Services.
Be It Enacted by the Senate and General Assembly of the State of New Jersey:
1. This act shall be known and may be cited as the “Local Hospital Fee Pilot Program Act.”
2. As used in this act:
“Commissioner” means the Commissioner of Human Services.
“Department” means the Department of Human Services.
“Fee” means the local health care-related fee authorized pursuant to this act.
“Hospital” means a hospital that is licensed pursuant to P.L.1971, c.136 (C.26:2H-1 et seq.) and is located within the borders of a participating city or participating county.
“Medicaid program” means the “New Jersey Medical Assistance and Health Services Program” established pursuant to P.L.1968, c.413 (C.30:4D-1 et seq.).
“Participating city” means a municipality in this State which has two or more general hospitals within its borders and which chooses to participate in the pilot program.
“Participating county” means a county which meets all of the following conditions: (i) has a population greater than 270,000, according to 2010 census data; (ii) at least 23 percent of its population is 17 years of age or younger, according to 2010 census data; and (iii) at least 11 percent of its population has income below the federal poverty level in the past twelve months, according to the United States Census Bureau 2007-2011 American Community Survey 5-year estimates; and which chooses to participate in the pilot program.
“Pilot program” means the “Local Hospital Fee Pilot Program” established pursuant to this act.
“Proposed fee and expenditure report” means a written report by a participating city or county that describes how the local hospital fee authorized by this act will be imposed in the jurisdiction, how the funds collected from the fee will be used by the participating city or county, including the amount and services the participating city or county plans to provide with the funds, 1in the case of a participating county report, whether any consideration is given to cities where impacted hospitals are located,1 and how the plan satisfies paragraph (1) of subsection b. of section 3 of this act.
3. a. There is established a “Local Hospital Fee Pilot Program” in the Department of Human Services.
b. The purpose of the pilot program is: (1) primarily to increase financial resources through the Medicaid program to support local hospitals and to ensure that they continue to provide necessary services to low-income citizens by authorizing the imposition of a local health care-related fee on hospitals within the borders of participating cities and counties; and (2) secondarily to provide participating cities and counties with new fiscal resources.
c. No more than five cities and four counties may participate in the pilot program.
d. The fee authorized pursuant to this act may be collected only to the extent, and for the period, that the commissioner determines that the revenues generated qualify as the State share of Medicaid program expenditures eligible for federal financial participation pursuant to 42 C.F.R. s.433.68.
e. (1) In order to ensure that local hospitals in the jurisdiction of a participating city or county continue to provide needed services to low-income individuals, the commissioner shall only use funds transferred from a participating city or county pursuant to paragraph (3) of subsection a. of section 4 of this act 1, and any Medicaid or other federal funds generated therefrom,1 for the following purposes: to increase Medicaid payments to hospitals in the jurisdiction from which the funds are received; for payments to Medicaid managed care organizations serving the jurisdiction from which the funds are received for increased hospital or hospital-related payments; and for administrative purposes to implement the pilot program.
(2) The commissioner shall seek to minimize the length of time between the collection of the fee authorized pursuant to this act and the increased payments authorized in paragraph (1) of this subsection.
(3) (a) Prior to the adoption of a resolution or ordinance, as applicable, providing for the imposition of the fee, a participating city or county shall submit a proposed fee and expenditure report to the commissioner for approval to ensure that the participating city or county fee and proposed fee and expenditure plan satisfies paragraph (1) of subsection b. and subsection d. of this section, and does not create a direct or indirect guarantee to hold harmless, as those terms are used in 42 C.F.R. s.433.68(f). Each participating city or county shall consult with impacted hospitals within its jurisdiction to prepare the proposed fee and expenditure report before the report is submitted to the commissioner. Prior to approval, the commissioner shall make the proposed fee and expenditure report available to the hospitals to review and to provide comments to the commissioner for a period of 21 calendar days.
(b) No single hospital shall be subject to more than one local fee authorized by this act. Where there is a participating city located within the geographic boundary of a participating county, the city and county shall mutually consent to the imposition of a local health care-related fee on all hospitals within the county’s borders or the city’s borders.
f. If a State plan amendment or an amendment to a Medicaid managed care organization contract is required to effectuate the purposes of this act or if a waiver is required pursuant to 42 C.F.R. s.433.68(e), the commissioner shall apply to the federal Centers for Medicare & Medicaid Services for approval of a State plan amendment, contract amendment, or waiver, as applicable, and shall receive approval prior to collection of a fee authorized pursuant to section 4 of this act.
g. Funds from this program shall not supplant or offset any current or future funds paid to acute care hospitals through other State or federal funding mechanisms or pools.
4. a. (1) Subject to the provisions of subsection d. of section 3 of this act, the governing body of a participating city or the board of chosen freeholders of a participating county may adopt a resolution or ordinance, as applicable, providing for the imposition of a local health care-related fee on hospitals located within its borders and for appropriate administrative provisions, including, but not limited to, provisions for the collection of interest and penalties.
(2) In accordance with paragraph (1) of subsection b. of section 3 of this act, at least 80 percent of the revenues collected from imposition of the fee authorized by this act shall be used by a participating city or county for the benefit of local hospitals or local hospital-related providers within its borders to ensure that the hospitals or hospital-related providers continue to provide necessary services to low-income citizens.
(3) For purposes of satisfying paragraph (2) of this subsection, a participating city or county may transfer funds collected from imposition of the fee to the commissioner for use as specified in paragraph (1) of subsection e. of section 3 of this act, or may retain the funds, in which case the participating city or county shall generate the same level of hospital funding that would otherwise be available through a federal match, and use those funds to satisfy the primary purpose of the bill pursuant to paragraph (1) of subsection b. of section 3 of this act.
b. The fee authorized pursuant to this act shall be implemented in accordance with the provisions of 42 U.S.C. s.1396b(w)(3)(A), and shall be subject to the maximum aggregate amount that may be assessed pursuant to 42 C.F.R. s.433.68(f)(3), or any subsequent maximum amount as may be established by federal law. The participating city or county may exempt a hospital within its jurisdiction from the fee, provided that the exemption complies with the requirements of 42 C.F.R. s.433.68.
c. Notwithstanding any other law to the contrary, the commissioner and a participating city or county are authorized to enter into an intergovernmental transfer agreement as may be necessary to transfer funds under paragraph (3) of subsection a. of this section or to otherwise satisfy the requirements of this act.
d. The fee shall not be imposed in relation to health care items or services provided prior to the effective date of this act or after December 31, 2018 and shall not be collected until the commissioner notifies the participating city or county that the conditions in subsection f. of section 3 of this act have been met.
e. The Commissioner of Community Affairs shall allow for the inclusion of the revenues generated by the local health care-related fee collected pursuant to this section in the fiscal year in which a city or county adopts the resolution or ordinance, as applicable, providing for the imposition of the fee.
f. No hospital subject to the fee imposed pursuant to this act shall pass on the cost of the fee to any patient, insurer, self-insured employer program, or other responsible party, nor list it separately on any invoice or statement sent to a patient, insurer, self-insured employer program, or other responsible party.
g. Revenues generated by the local health care-related fee shall not supplant or offset any current or future State funds allocated to a city or county participating in the pilot program.
h. Unless otherwise prohibited by the federal government, no Medicaid managed care company operating in the State shall retain any revenues generated by the fee authorized by this act, other than to offset any increased administrative costs incurred as a result of the pilot program.
5. This act shall take effect immediately, subject to such actions by the federal government as are necessary to effectuate the purposes of this act, and shall expire December 31, 2018.