Bill Text: CA AB498 | 2013-2014 | Regular Session | Enrolled

NOTE: There are more recent revisions of this legislation. Read Latest Draft

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Bill Title: Medi-Cal.

Spectrum: Slight Partisan Bill (Republican 4-2)

Status: (Passed) 2013-10-10 - Chaptered by Secretary of State - Chapter 672, Statutes of 2013. [AB498 Detail]

Download: California-2013-AB498-Enrolled.html

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BILL NUMBER: AB 498	ENROLLED
	BILL TEXT

	PASSED THE SENATE  SEPTEMBER 12, 2013
	PASSED THE ASSEMBLY  SEPTEMBER 12, 2013
	AMENDED IN SENATE  SEPTEMBER 5, 2013
	AMENDED IN SENATE  AUGUST 20, 2013
	AMENDED IN SENATE  JUNE 20, 2013
	AMENDED IN ASSEMBLY  MAY 7, 2013
	AMENDED IN ASSEMBLY  APRIL 23, 2013
	AMENDED IN ASSEMBLY  MARCH 19, 2013

INTRODUCED BY   Assembly Member Chávez
   (Coauthors: Assembly Members Alejo, Bigelow, Chesbro, and Conway)
   (Coauthor: Senator Nielsen)

                        FEBRUARY 20, 2013

   An act to amend Sections 14105.27 and 14166.151 of, and to repeal
Sections 14166.152, 14166.153, 14166.154, and 14166.155 of, the
Welfare and Institutions Code, relating to Medi-Cal.


	LEGISLATIVE COUNSEL'S DIGEST


   AB 498, Chávez. Medi-Cal.
   (1) Existing law provides for the Medi-Cal program, which is
administered by the State Department of Health Care Services, under
which qualified low-income individuals receive health care services.
Existing law provides that a health facility is eligible to receive
supplemental reimbursement under the Medi-Cal program if the facility
has specified characteristics, including that the facility is owned
or operated by the state, a county, a city, a city and county, or a
health care district. Existing law prohibits claimed expenditures for
specified nursing facility services, when combined with the amount
received from all other sources of reimbursement from the Medi-Cal
program, from exceeding 100% of projected costs, as determined
pursuant to the Medi-Cal State Plan, for skilled nursing services at
each facility.
   This bill would, instead, prohibit those claimed expenditures from
exceeding 100% of allowable costs. The bill would require that
supplemental reimbursement be subject to a reconciliation process
established in the state plan to ensure that supplemental
reimbursement is not made in excess of allowable costs, and to ensure
that it is made up to allowable costs.
   (2) The Medi-Cal program is, in part, governed and funded by
federal Medicaid Program provisions. Existing law, subject to federal
approval, modifies the inpatient fee-for-service reimbursement
methodology for nondesignated public hospitals, as defined, under a
specified demonstration project for services on or after July 1,
2012. Existing law provides that beginning with the 2012-13 fiscal
year, and if specified conditions are met, nondesignated public
hospitals, or governmental entities with which the hospitals are
affiliated, shall be eligible to receive safety net care pool
payments for uncompensated care from the Health Care Support Fund.
Existing law provides that these provisions shall become operative on
the date that all necessary federal approvals have been obtained to
implement these and other related provisions. Existing law requires
designated public hospitals to report and certify specified
information for each successor demonstration year beginning with the
2012-13 fiscal year.
    This bill would revise and recast those provisions. This bill
would instead authorize the department to seek necessary federal
approvals or waivers to separately implement the safety net care pool
payments for uncompensated care provisions for the 2013-14 and
2014-15 fiscal years. The bill would require the state, if the state
receives federal safety net care pool funds for uncompensated care
under these provisions, to retain 1/2 of the funds for Medi-Cal
related expenditures.
   (3) Under existing law, nondesignated public hospitals may receive
fee-for-service payments for inpatient services, as specified. Under
existing law, beginning with the 2012-13 fiscal year, subject to
federal approval and if specified conditions are met, nondesignated
public hospitals may receive delivery system reform incentive pool
funding, as specified.
   This bill would eliminate those provisions.


THE PEOPLE OF THE STATE OF CALIFORNIA DO ENACT AS FOLLOWS:

  SECTION 1.  Section 14105.27 of the Welfare and Institutions Code
is amended to read:
   14105.27.  (a) Each eligible facility, as described in subdivision
(b) may, in addition to the rate of payment that the facility would
otherwise receive for skilled nursing services, receive supplemental
Medi-Cal reimbursement to the extent provided in this section.
   (b) A facility shall be eligible for supplemental reimbursement
only if the facility has all of the following characteristics
continuously during the department's rate year:
   (1) Provides services to Medi-Cal beneficiaries.
   (2) Is either of the following:
   (A) For the department's rate year beginning August 1, 2001, and
for subsequent rate years, a distinct part of an acute care hospital
providing skilled nursing services. For purposes of this section,
"acute care hospital" means a facility described by subdivision (a)
or (b), or both, of Section 1250 of the Health and Safety Code.
   (B) For the department's rate year beginning August 1, 2006, and
for subsequent rate years, a state home, as defined in Section 101
(19) of Title 38 of the United States Code.
   (3) Is owned or operated by the state, or by a county, city, city
and county, or health care district organized pursuant to Chapter 1
(commencing with Section 32000) of Division 23 of the Health and
Safety Code.
   (c) An eligible facility's supplemental reimbursement pursuant to
this section shall be calculated and paid as follows:
   (1) The supplemental reimbursement to an eligible facility, as
described in paragraph (4), shall be equal to the amount of federal
financial participation received as a result of the claims submitted
pursuant to paragraph (2) of subdivision (g).
   (2) In no instance shall the amount certified pursuant to
paragraph (1) of subdivision (e), when combined with the amount
received from all other sources of reimbursement from the Medi-Cal
program, exceed 100 percent of allowable costs, as determined
pursuant to the Medi-Cal State Plan, for distinct part skilled
nursing services at each facility.
   (3) Costs associated with the provision of subacute services
pursuant to Section 14132.25 shall not be certified for supplemental
reimbursement pursuant to this section.
   (4) The supplemental Medi-Cal reimbursement provided by this
section shall be distributed under a payment methodology based on
skilled nursing services provided to Medi-Cal patients at the
eligible facility, either on a per diem basis, a per discharge basis,
or any other federally permissible basis. The department shall seek
approval from the federal Centers for Medicare and Medicaid Services
for the payment methodology to be utilized, and shall not make any
payment pursuant to this section prior to obtaining that approval.
   (d) (1) It is the Legislature's intent in enacting this section to
provide the supplemental reimbursement described in this section
without any expenditure from the General Fund. An eligible facility,
as a condition of receiving supplemental reimbursement pursuant to
this section, shall enter into, and maintain, an agreement with the
department for the purposes of implementing this section and
reimbursing the department for the costs of administering this
section.
   (2) The state share of the supplemental reimbursement submitted to
the federal Centers for Medicare and Medicaid Services for purposes
of claiming federal financial participation shall be paid only with
funds from the governmental entities described in paragraph (3) of
subdivision (b) and certified to the state as provided in subdivision
(e).
   (e) The particular governmental entity, described in paragraph (3)
of subdivision (b), on behalf of any eligible facility shall do all
of the following:
   (1) Certify, in conformity with the requirements of Section 433.51
of Title 42 of the Code of Federal Regulations, that the claimed
expenditures for distinct part nursing facility services are eligible
for federal financial participation.
   (2) Provide evidence supporting the certification as specified by
the department.
   (3) Submit data as specified by the department to determine the
appropriate amounts to claim as expenditures qualifying for federal
financial participation.
   (4) Keep, maintain, and have readily retrievable, any records
specified by the department to fully disclose reimbursement amounts
to which the eligible facility is entitled, and any other records
required by the federal Centers for Medicare and Medicaid Services.
   (f) The department may require that any governmental entity,
described in paragraph (3) of subdivision (b), seeking supplemental
reimbursement under this section enter into an interagency agreement
with the department for the purpose of implementing this section.
   (g) (1) The department shall promptly seek any necessary federal
approvals, including a federal medicaid waiver, for the
implementation of this section. If necessary to obtain federal
approval, the department may limit the program to those costs that
are allowable expenditures under Title XIX of the federal Social
Security Act (Subchapter 19 (commencing with Section 1396) of Chapter
7 of Title 42 of the United States Code). If federal approval is not
obtained for implementation of this section, this section shall
become inoperative.
   (2) The department shall submit claims for federal financial
participation for the expenditures for the services described in
subdivision (e) that are allowable expenditures under federal law.
   (3) The department shall, on an annual basis, submit any necessary
materials to the federal government to provide assurances that
claims for federal financial participation will include only those
expenditures that are allowable under federal law.
   (h) In the event there is a final judicial determination by any
court of appellate jurisdiction or a final determination by the
administrator of the federal Centers for Medicare and Medicaid
Services that the supplemental reimbursement provided in this section
must be made to any facility not described in this section, this
section shall become immediately inoperative.
   (i) All funds expended pursuant to this section are subject to
review and audit by the department.
   (j) Supplemental reimbursement made pursuant to this section shall
be subject to a reconciliation process established in the Medi-Cal
State Plan to ensure that it is not made in excess of allowable
costs, and to ensure that it is made up to allowable costs.
  SEC. 2.  Section 14166.151 of the Welfare and Institutions Code is
amended to read:
   14166.151.  (a) It is the intent of the Legislature to allow for a
voluntary process for nondesignated public hospitals to claim
reimbursement from the safety net care pool in the successor
demonstration project based on their public structure, to the extent
that there is funding available for nondesignated public hospitals in
that pool, as allowed by the federal government, which shall be
allocated equally between the state and the nondesignated public
hospital, so that for every dollar of certified public expenditure
used by the nondesignated public hospital, the nondesignated public
hospital shall voluntarily allow the state to use a corresponding
certified public expenditure amount for claiming purposes.
   (b) (1) Beginning with services provided on or after July 1, 2013,
nondesignated public hospitals shall be eligible to receive safety
net care pool payments for uncompensated care costs to the extent
that additional federal funding is made available pursuant to the
Special Terms and Conditions for the safety net care pool
uncompensated care limit of the successor demonstration project and
if they comply with the requirements set forth in this section.
   (2) The amount of funds that may be claimed pursuant to paragraph
(1) shall not exceed the additional federal funding made available
under the safety net care pool for nondesignated public hospital
uncompensated care costs, and shall not reduce the amounts of federal
funding for safety net care pool uncompensated care costs that would
otherwise be made available to designated public hospitals in the
absence of this paragraph, including the amounts available under the
Special Terms and Conditions in effect as of July 1, 2013, and
amounts available pursuant to Section 15916.
   (3) (A) Notwithstanding paragraph (2), if the designated public
hospitals do not have sufficient certified public expenditures to
claim the full amount of federal funding made available to the
designated public hospitals as referenced in paragraph (2), including
consideration of the potential for the designated public hospitals
to have sufficient certified public expenditures in a subsequent
year, the department may authorize the funding to be claimed by the
nondesignated public hospitals.
   (B) The department may determine whether designated public
hospitals do not have sufficient certified public expenditures to
claim the full amount of federal funding pursuant to subparagraph (B)
no sooner than after the submission of the cost reporting
information required pursuant to Section 14166.8 for the applicable
successor demonstration year.
   (C) If the department makes the determination identified in
subparagraph (B) based on as-filed cost reporting information
submitted prior to a final audit, the department shall make the
determination in consultation with the designated public hospitals
and shall apply an audit cushion of at least 5 percent to the
as-filed cost information. If the department makes the determination
identified in subparagraph (B) based on audited cost reporting
information, no audit cushion shall be applied.
   (c) Beginning in the 2013-14 fiscal year, within five months after
the end of a successor demonstration year, nondesignated public
hospitals shall submit to the department all of the following
reports:
   (1) The hospital's Medicare or Medicaid cost report for the
successor demonstration year.
   (2) Other cost reporting and statistical data necessary for the
determination of amounts due to the hospital under the successor
demonstration project, as requested by the department.
   (d) For each successor demonstration year, the reports shall
identify all of the costs incurred in providing hospital services to
uninsured individuals.
   (e) A nondesignated public hospital, or the governmental entity
with which it is affiliated, that operates nonhospital clinics or
provides physician, nonphysician practitioner, or other health care
services that are not identified as hospital services under the
Special Terms and Conditions for the successor demonstration project,
shall report and certify all of the uncompensated uninsured costs of
the services furnished.
   (f) Reports submitted under this section shall include all
allowable costs.
   (g) The appropriate public official shall certify to all of the
following:
   (1) The accuracy of the reports required under this section.
   (2) That the expenditures to meet the reported costs comply with
Section 433.51 of Title 42 of the Code of Federal Regulations.
   (3) That the sources of funds used to make the expenditures
certified under this section do not include impermissible provider
taxes or donations, as defined under Section 1396b(w) of Title 42 of
the United States Code, or other federal funds. For this purpose,
federal funds do not include delivery system reform incentive pool
payments or patient care revenue received as payment for services
rendered under programs such as nondesignated state health programs,
the Low Income Health Program, Medicare, or Medicaid.
   (h) The certification of public expenditures made pursuant to this
section shall be based on a schedule established by the department
in accordance with federal requirements.
   (1) The director may require nondesignated public hospitals to
submit quarterly estimates of anticipated expenditures, if these
estimates are necessary to obtain interim payments of federal
Medicaid funds.
   (2) All reported expenditures shall be subject to reconciliation
to allowable costs, as determined in accordance with applicable
implementing documents for the successor demonstration project.
   (i) The timeframes for data submission and reporting periods may
be adjusted as necessary in accordance with federal requirements.
   (j) (1) Beginning in the 2013-14 fiscal year, safety net care pool
payments for uncompensated care shall be allocated to nondesignated
public hospitals as follows:
   (A) The department shall determine the maximum amount of safety
net care pool payments for uncompensated care that is available to
nondesignated public hospitals for the successor demonstration year
pursuant to this section. This determination shall be made solely
with respect to allowable uncompensated care costs incurred by
nondesignated public hospitals and reported pursuant to subdivisions
(c) to (i), inclusive.
   (B) The department shall establish, in consultation with the
nondesignated public hospitals, an allocation methodology to
determine the amount of safety net care pool payments to be made to
the nondesignated public hospitals. The allocation methodology shall
be implemented when the director issues a declaration stating that
the methodology complies with all applicable federal requirements for
federal financial participation.
   (2) A safety net care pool payment amount may be paid to a
nondesignated public hospital, or governmental entity with which it
is affiliated, pursuant to this section independent of the amount of
uncompensated uninsured costs that is certified as public
expenditures pursuant to subdivisions (c) to (i), inclusive, provided
that, in accordance with the Special Terms and Conditions for the
successor demonstration project, the recipient hospital shall not
return any portion of the funds received to any unit of government,
excluding amounts recovered by the state or federal government.
   (3) Nondesignated public hospitals, or governmental entities with
which they are affiliated, shall receive the amount established
pursuant to this subdivision, less the 50 percent retained by the
state pursuant to subdivision (l), in quarterly interim payments
during the successor demonstration year. The determination of the
interim payments shall be made on an interim basis prior to the start
of each successor demonstration year. The department shall use the
cost and statistical data that is in subdivisions (c) to (i),
inclusive.
   (k) (1) No later than April 1 following the end of the relevant
reporting period for the successor demonstration year, the department
shall undertake an interim reconciliation of the payment amount
established pursuant to subdivision (j) for nondesignated public
hospitals using Medicare and other cost, payment, and statistical
data submitted by the hospitals for the successor demonstration year,
and shall adjust payments to the hospitals accordingly.
   (2) All payments to nondesignated public hospitals are subject to
a final reconciliation that is subject to final audits of all
applicable Medicare and other cost, payment, discharge, and
statistical data for the successor demonstration year.
   (l) The process for supplemental payments made in subdivisions (j)
and (k) is a voluntary process the implementation of which is
limited by this subdivision. The department may submit for federal
approval a proposed amendment to the successor demonstration project
to implement this section.
   (1) If a nondesignated public hospital voluntarily agrees to
participate in a process that, up to the amount of safety net care
pool funds available, allows the certified public expenditures for
uncompensated care under this section to be allocated equally between
the state and the nondesignated public hospital, so that for every
dollar of certified public expenditure used by the nondesignated
public hospital, the nondesignated public hospital shall voluntarily
allow the state to use a corresponding certified public expenditure
amount for claiming purposes. Participation in the safety net care
pool under this section is voluntary on the part of the nondesignated
public hospital for the purposes of all applicable federal laws. If
a nondesignated public hospital does not voluntarily agree to
participate in this process, it shall not be eligible to receive
safety net care pool funds.
   (2) If the budget neutrality requirements established under
Section XI of the Special Terms and Conditions of the successor
demonstration project are exceeded, payments made under this section
shall be reduced or refunded to achieve budget neutrality before any
other payments under the successor demonstration project are made.
The state's share of the federal financial participation shall be
reduced after the provider's share has been exhausted.
   (3) Notwithstanding any other provision of law, upon the receipt
of a notice of disallowance or deferral from the federal government
related to any certified public expenditures for uncompensated care
incurred by the nondesignated public hospital that are used for
federal claiming under the safety net care pool pursuant to the
successor demonstration project after this section is implemented,
and subject to the processes set forth in this section, the
department and the nondesignated public hospitals shall each be
responsible for one-half of the repayment of the federal portion of
any federal disallowance or deferral for the applicable successor
demonstration year, up to the amount claimed and allocated pursuant
to this section for that particular year beginning with the 2013-14
fiscal year.
   (4) This section shall be implemented only to the extent other
federal financial participation is not jeopardized.
   (m) Eligible providers, as a condition of receiving supplemental
reimbursement pursuant to this section, shall enter into, and
maintain, an agreement with the department for the purposes of
implementing this section and reimbursing the department for the
costs of administering this section, including, but not limited to,
the state personnel costs. No General Fund moneys shall be expended
for the implementation and administration of this section.
  SEC. 3.  Section 14166.152 of the Welfare and Institutions Code is
repealed.
  SEC. 4.  Section 14166.153 of the Welfare and Institutions Code is
repealed.
  SEC. 5.  Section 14166.154 of the Welfare and Institutions Code is
repealed.
  SEC. 6.  Section 14166.155 of the Welfare and Institutions Code is
repealed.