Bill Amendment: IL SB0115 | 2019-2020 | 101st General Assembly

NOTE: For additional amemendments please see the Bill Drafting List

---

Bill Title: FINANCE-AUDIT EXPENSE FUND

Status: 2021-01-13 - Session Sine Die [SB0115 Detail]

Download: Illinois-2019-SB0115-House_Amendment_001.html

---

Rep. Robert Rita

Filed: 10/28/2019

10100SB0115ham001 LRB101 04834 KTG 64192 a
AMENDMENT TO SENATE BILL 115
AMENDMENT NO. ______. Amend Senate Bill 115 by replacing
everything after the enacting clause with the following:
"Section 5. The Emergency Medical Services (EMS) Systems
Act is amended by changing Section 32.5 as follows:
(210 ILCS 50/32.5)
Sec. 32.5. Freestanding Emergency Center.
(a) The Department shall issue an annual Freestanding
Emergency Center (FEC) license to any facility that has
received a permit from the Health Facilities and Services
Review Board to establish a Freestanding Emergency Center by
January 1, 2015, and:
(1) is located: (A) in a municipality with a population
of 50,000 or fewer inhabitants; (B) within 50 miles of the
hospital that owns or controls the FEC; and (C) within 50
miles of the Resource Hospital affiliated with the FEC as

10100SB0115ham001 - 2 - LRB101 04834 KTG 64192 a
part of the EMS System;
(2) is wholly owned or controlled by an Associate or
Resource Hospital, but is not a part of the hospital's
physical plant;
(3) meets the standards for licensed FECs, adopted by
rule of the Department, including, but not limited to:
(A) facility design, specification, operation, and
maintenance standards;
(B) equipment standards; and
(C) the number and qualifications of emergency
medical personnel and other staff, which must include
at least one board certified emergency physician
present at the FEC 24 hours per day.
(4) limits its participation in the EMS System strictly
to receiving a limited number of patients by ambulance: (A)
according to the FEC's 24-hour capabilities; (B) according
to protocols developed by the Resource Hospital within the
FEC's designated EMS System; and (C) as pre-approved by
both the EMS Medical Director and the Department;
(5) provides comprehensive emergency treatment
services, as defined in the rules adopted by the Department
pursuant to the Hospital Licensing Act, 24 hours per day,
on an outpatient basis;
(6) provides an ambulance and maintains on site
ambulance services staffed with paramedics 24 hours per
day;

10100SB0115ham001 - 3 - LRB101 04834 KTG 64192 a
(7) (blank);
(8) complies with all State and federal patient rights
provisions, including, but not limited to, the Emergency
Medical Treatment Act and the federal Emergency Medical
Treatment and Active Labor Act;
(9) maintains a communications system that is fully
integrated with its Resource Hospital within the FEC's
designated EMS System;
(10) reports to the Department any patient transfers
from the FEC to a hospital within 48 hours of the transfer
plus any other data determined to be relevant by the
Department;
(11) submits to the Department, on a quarterly basis,
the FEC's morbidity and mortality rates for patients
treated at the FEC and other data determined to be relevant
by the Department;
(12) does not describe itself or hold itself out to the
general public as a full service hospital or hospital
emergency department in its advertising or marketing
activities;
(13) complies with any other rules adopted by the
Department under this Act that relate to FECs;
(14) passes the Department's site inspection for
compliance with the FEC requirements of this Act;
(15) submits a copy of the permit issued by the Health
Facilities and Services Review Board indicating that the

10100SB0115ham001 - 4 - LRB101 04834 KTG 64192 a
facility has complied with the Illinois Health Facilities
Planning Act with respect to the health services to be
provided at the facility;
(16) submits an application for designation as an FEC
in a manner and form prescribed by the Department by rule;
and
(17) pays the annual license fee as determined by the
Department by rule.
(a-5) Notwithstanding any other provision of this Section,
the Department may issue an annual FEC license to a facility
that is located in a county that does not have a licensed
general acute care hospital if the facility's application for a
permit from the Illinois Health Facilities Planning Board has
been deemed complete by the Department of Public Health by
January 1, 2014 and if the facility complies with the
requirements set forth in paragraphs (1) through (17) of
subsection (a).
(a-7) Notwithstanding any other provision of this Section,
the Department may issue an annual FEC license to a facility
that (i) is located in a county having a population of more
than 3,000,000 and (ii) was approved to discontinue operations
as a hospital by the Health Facilities and Services Review
Board in calendar year 2019 under Health Facilities and
Services Review Board project number E-024-19, if the facility
complies with the requirements set forth in paragraphs (1)
through (17) of subsection (a).

10100SB0115ham001 - 5 - LRB101 04834 KTG 64192 a
(a-10) Notwithstanding any other provision of this
Section, the Department may issue an annual FEC license to a
facility if the facility has, by January 1, 2014, filed a
letter of intent to establish an FEC and if the facility
complies with the requirements set forth in paragraphs (1)
through (17) of subsection (a).
(a-15) Notwithstanding any other provision of this
Section, the Department shall issue an annual FEC license to a
facility if the facility: (i) discontinues operation as a
hospital within 180 days after December 4, 2015 (the effective
date of Public Act 99-490) this amendatory Act of the 99th
General Assembly with a Health Facilities and Services Review
Board project number of E-017-15; (ii) has an application for a
permit to establish an FEC from the Health Facilities and
Services Review Board that is deemed complete by January 1,
2017; and (iii) complies with the requirements set forth in
paragraphs (1) through (17) of subsection (a) of this Section.
(a-20) Notwithstanding any other provision of this
Section, the Department shall issue an annual FEC license to a
facility if:
(1) the facility is a hospital that has discontinued
inpatient hospital services;
(2) the Department of Healthcare and Family Services
has certified the conversion to an FEC was approved by the
Hospital Transformation Review Committee as a project
subject to the hospital's transformation under subsection

10100SB0115ham001 - 6 - LRB101 04834 KTG 64192 a
(d-5) of Section 14-12 of the Illinois Public Aid Code;
(3) the facility complies with the requirements set
forth in paragraphs (1) through (17), provided however that
the FEC may be located in a municipality with a population
greater than 50,000 inhabitants and shall not be subject to
the requirements of the Illinois Health Facilities
Planning Act that are applicable to the conversion to an
FEC if the Department of Healthcare and Family Services
Service has certified the conversion to an FEC was approved
by the Hospital Transformation Review Committee as a
project subject to the hospital's transformation under
subsection (d-5) of Section 14-12 of the Illinois Public
Aid Code; and
(4) the facility is located at the same physical
location where the facility served as a hospital.
(b) The Department shall:
(1) annually inspect facilities of initial FEC
applicants and licensed FECs, and issue annual licenses to
or annually relicense FECs that satisfy the Department's
licensure requirements as set forth in subsection (a);
(2) suspend, revoke, refuse to issue, or refuse to
renew the license of any FEC, after notice and an
opportunity for a hearing, when the Department finds that
the FEC has failed to comply with the standards and
requirements of the Act or rules adopted by the Department
under the Act;

10100SB0115ham001 - 7 - LRB101 04834 KTG 64192 a
(3) issue an Emergency Suspension Order for any FEC
when the Director or his or her designee has determined
that the continued operation of the FEC poses an immediate
and serious danger to the public health, safety, and
welfare. An opportunity for a hearing shall be promptly
initiated after an Emergency Suspension Order has been
issued; and
(4) adopt rules as needed to implement this Section.
(Source: P.A. 99-490, eff. 12-4-15; 99-710, eff. 8-5-16;
100-581, eff. 3-12-18; revised 7-23-19.)
Section 10. The Illinois Public Aid Code is amended by
changing Section 14-12 as follows:
(305 ILCS 5/14-12)
Sec. 14-12. Hospital rate reform payment system. The
hospital payment system pursuant to Section 14-11 of this
Article shall be as follows:
(a) Inpatient hospital services. Effective for discharges
on and after July 1, 2014, reimbursement for inpatient general
acute care services shall utilize the All Patient Refined
Diagnosis Related Grouping (APR-DRG) software, version 30,
distributed by 3MTM Health Information System.
(1) The Department shall establish Medicaid weighting
factors to be used in the reimbursement system established
under this subsection. Initial weighting factors shall be

10100SB0115ham001 - 8 - LRB101 04834 KTG 64192 a
the weighting factors as published by 3M Health Information
System, associated with Version 30.0 adjusted for the
Illinois experience.
(2) The Department shall establish a
statewide-standardized amount to be used in the inpatient
reimbursement system. The Department shall publish these
amounts on its website no later than 10 calendar days prior
to their effective date.
(3) In addition to the statewide-standardized amount,
the Department shall develop adjusters to adjust the rate
of reimbursement for critical Medicaid providers or
services for trauma, transplantation services, perinatal
care, and Graduate Medical Education (GME).
(4) The Department shall develop add-on payments to
account for exceptionally costly inpatient stays,
consistent with Medicare outlier principles. Outlier fixed
loss thresholds may be updated to control for excessive
growth in outlier payments no more frequently than on an
annual basis, but at least triennially. Upon updating the
fixed loss thresholds, the Department shall be required to
update base rates within 12 months.
(5) The Department shall define those hospitals or
distinct parts of hospitals that shall be exempt from the
APR-DRG reimbursement system established under this
Section. The Department shall publish these hospitals'
inpatient rates on its website no later than 10 calendar

10100SB0115ham001 - 9 - LRB101 04834 KTG 64192 a
days prior to their effective date.
(6) Beginning July 1, 2014 and ending on June 30, 2024,
in addition to the statewide-standardized amount, the
Department shall develop an adjustor to adjust the rate of
reimbursement for safety-net hospitals defined in Section
5-5e.1 of this Code excluding pediatric hospitals.
(7) Beginning July 1, 2014 and ending on June 30, 2020,
or upon implementation of inpatient psychiatric rate
increases as described in subsection (n) of Section
5A-12.6, in addition to the statewide-standardized amount,
the Department shall develop an adjustor to adjust the rate
of reimbursement for Illinois freestanding inpatient
psychiatric hospitals that are not designated as
children's hospitals by the Department but are primarily
treating patients under the age of 21.
(7.5) Beginning July 1, 2020, the reimbursement for
inpatient psychiatric services shall be so that base claims
projected reimbursement is increased by an amount equal to
the funds allocated in paragraph (2) of subsection (b) of
Section 5A-12.6, less the amount allocated under
paragraphs (8) and (9) of this subsection and paragraphs
(3) and (4) of subsection (b) multiplied by 13%. Beginning
July 1, 2022, the reimbursement for inpatient psychiatric
services shall be so that base claims projected
reimbursement is increased by an amount equal to the funds
allocated in paragraph (3) of subsection (b) of Section

10100SB0115ham001 - 10 - LRB101 04834 KTG 64192 a
5A-12.6, less the amount allocated under paragraphs (8) and
(9) of this subsection and paragraphs (3) and (4) of
subsection (b) multiplied by 13%. Beginning July 1, 2024,
the reimbursement for inpatient psychiatric services shall
be so that base claims projected reimbursement is increased
by an amount equal to the funds allocated in paragraph (4)
of subsection (b) of Section 5A-12.6, less the amount
allocated under paragraphs (8) and (9) of this subsection
and paragraphs (3) and (4) of subsection (b) multiplied by
13%.
(8) Beginning July 1, 2018, in addition to the
statewide-standardized amount, the Department shall adjust
the rate of reimbursement for hospitals designated by the
Department of Public Health as a Perinatal Level II or II+
center by applying the same adjustor that is applied to
Perinatal and Obstetrical care cases for Perinatal Level
III centers, as of December 31, 2017.
(9) Beginning July 1, 2018, in addition to the
statewide-standardized amount, the Department shall apply
the same adjustor that is applied to trauma cases as of
December 31, 2017 to inpatient claims to treat patients
with burns, including, but not limited to, APR-DRGs 841,
842, 843, and 844.
(10) Beginning July 1, 2018, the
statewide-standardized amount for inpatient general acute
care services shall be uniformly increased so that base

10100SB0115ham001 - 11 - LRB101 04834 KTG 64192 a
claims projected reimbursement is increased by an amount
equal to the funds allocated in paragraph (1) of subsection
(b) of Section 5A-12.6, less the amount allocated under
paragraphs (8) and (9) of this subsection and paragraphs
(3) and (4) of subsection (b) multiplied by 40%. Beginning
July 1, 2020, the statewide-standardized amount for
inpatient general acute care services shall be uniformly
increased so that base claims projected reimbursement is
increased by an amount equal to the funds allocated in
paragraph (2) of subsection (b) of Section 5A-12.6, less
the amount allocated under paragraphs (8) and (9) of this
subsection and paragraphs (3) and (4) of subsection (b)
multiplied by 40%. Beginning July 1, 2022, the
statewide-standardized amount for inpatient general acute
care services shall be uniformly increased so that base
claims projected reimbursement is increased by an amount
equal to the funds allocated in paragraph (3) of subsection
(b) of Section 5A-12.6, less the amount allocated under
paragraphs (8) and (9) of this subsection and paragraphs
(3) and (4) of subsection (b) multiplied by 40%. Beginning
July 1, 2023 the statewide-standardized amount for
inpatient general acute care services shall be uniformly
increased so that base claims projected reimbursement is
increased by an amount equal to the funds allocated in
paragraph (4) of subsection (b) of Section 5A-12.6, less
the amount allocated under paragraphs (8) and (9) of this

10100SB0115ham001 - 12 - LRB101 04834 KTG 64192 a
subsection and paragraphs (3) and (4) of subsection (b)
multiplied by 40%.
(11) Beginning July 1, 2018, the reimbursement for
inpatient rehabilitation services shall be increased by
the addition of a $96 per day add-on.
Beginning July 1, 2020, the reimbursement for
inpatient rehabilitation services shall be uniformly
increased so that the $96 per day add-on is increased by an
amount equal to the funds allocated in paragraph (2) of
subsection (b) of Section 5A-12.6, less the amount
allocated under paragraphs (8) and (9) of this subsection
and paragraphs (3) and (4) of subsection (b) multiplied by
0.9%.
Beginning July 1, 2022, the reimbursement for
inpatient rehabilitation services shall be uniformly
increased so that the $96 per day add-on as adjusted by the
July 1, 2020 increase, is increased by an amount equal to
the funds allocated in paragraph (3) of subsection (b) of
Section 5A-12.6, less the amount allocated under
paragraphs (8) and (9) of this subsection and paragraphs
(3) and (4) of subsection (b) multiplied by 0.9%.
Beginning July 1, 2023, the reimbursement for
inpatient rehabilitation services shall be uniformly
increased so that the $96 per day add-on as adjusted by the
July 1, 2022 increase, is increased by an amount equal to
the funds allocated in paragraph (4) of subsection (b) of

10100SB0115ham001 - 13 - LRB101 04834 KTG 64192 a
Section 5A-12.6, less the amount allocated under
paragraphs (8) and (9) of this subsection and paragraphs
(3) and (4) of subsection (b) multiplied by 0.9%.
(b) Outpatient hospital services. Effective for dates of
service on and after July 1, 2014, reimbursement for outpatient
services shall utilize the Enhanced Ambulatory Procedure
Grouping (EAPG) software, version 3.7 distributed by 3MTM
Health Information System.
(1) The Department shall establish Medicaid weighting
factors to be used in the reimbursement system established
under this subsection. The initial weighting factors shall
be the weighting factors as published by 3M Health
Information System, associated with Version 3.7.
(2) The Department shall establish service specific
statewide-standardized amounts to be used in the
reimbursement system.
(A) The initial statewide standardized amounts,
with the labor portion adjusted by the Calendar Year
2013 Medicare Outpatient Prospective Payment System
wage index with reclassifications, shall be published
by the Department on its website no later than 10
calendar days prior to their effective date.
(B) The Department shall establish adjustments to
the statewide-standardized amounts for each Critical
Access Hospital, as designated by the Department of
Public Health in accordance with 42 CFR 485, Subpart F.

10100SB0115ham001 - 14 - LRB101 04834 KTG 64192 a
For outpatient services provided on or before June 30,
2018, the EAPG standardized amounts are determined
separately for each critical access hospital such that
simulated EAPG payments using outpatient base period
paid claim data plus payments under Section 5A-12.4 of
this Code net of the associated tax costs are equal to
the estimated costs of outpatient base period claims
data with a rate year cost inflation factor applied.
(3) In addition to the statewide-standardized amounts,
the Department shall develop adjusters to adjust the rate
of reimbursement for critical Medicaid hospital outpatient
providers or services, including outpatient high volume or
safety-net hospitals. Beginning July 1, 2018, the
outpatient high volume adjustor shall be increased to
increase annual expenditures associated with this adjustor
by $79,200,000, based on the State Fiscal Year 2015 base
year data and this adjustor shall apply to public
hospitals, except for large public hospitals, as defined
under 89 Ill. Adm. Code 148.25(a).
(4) Beginning July 1, 2018, in addition to the
statewide standardized amounts, the Department shall make
an add-on payment for outpatient expensive devices and
drugs. This add-on payment shall at least apply to claim
lines that: (i) are assigned with one of the following
EAPGs: 490, 1001 to 1020, and coded with one of the
following revenue codes: 0274 to 0276, 0278; or (ii) are

10100SB0115ham001 - 15 - LRB101 04834 KTG 64192 a
assigned with one of the following EAPGs: 430 to 441, 443,
444, 460 to 465, 495, 496, 1090. The add-on payment shall
be calculated as follows: the claim line's covered charges
multiplied by the hospital's total acute cost to charge
ratio, less the claim line's EAPG payment plus $1,000,
multiplied by 0.8.
(5) Beginning July 1, 2018, the statewide-standardized
amounts for outpatient services shall be increased by a
uniform percentage so that base claims projected
reimbursement is increased by an amount equal to no less
than the funds allocated in paragraph (1) of subsection (b)
of Section 5A-12.6, less the amount allocated under
paragraphs (8) and (9) of subsection (a) and paragraphs (3)
and (4) of this subsection multiplied by 46%. Beginning
July 1, 2020, the statewide-standardized amounts for
outpatient services shall be increased by a uniform
percentage so that base claims projected reimbursement is
increased by an amount equal to no less than the funds
allocated in paragraph (2) of subsection (b) of Section
5A-12.6, less the amount allocated under paragraphs (8) and
(9) of subsection (a) and paragraphs (3) and (4) of this
subsection multiplied by 46%. Beginning July 1, 2022, the
statewide-standardized amounts for outpatient services
shall be increased by a uniform percentage so that base
claims projected reimbursement is increased by an amount
equal to the funds allocated in paragraph (3) of subsection

10100SB0115ham001 - 16 - LRB101 04834 KTG 64192 a
(b) of Section 5A-12.6, less the amount allocated under
paragraphs (8) and (9) of subsection (a) and paragraphs (3)
and (4) of this subsection multiplied by 46%. Beginning
July 1, 2023, the statewide-standardized amounts for
outpatient services shall be increased by a uniform
percentage so that base claims projected reimbursement is
increased by an amount equal to no less than the funds
allocated in paragraph (4) of subsection (b) of Section
5A-12.6, less the amount allocated under paragraphs (8) and
(9) of subsection (a) and paragraphs (3) and (4) of this
subsection multiplied by 46%.
(6) Effective for dates of service on or after July 1,
2018, the Department shall establish adjustments to the
statewide-standardized amounts for each Critical Access
Hospital, as designated by the Department of Public Health
in accordance with 42 CFR 485, Subpart F, such that each
Critical Access Hospital's standardized amount for
outpatient services shall be increased by the applicable
uniform percentage determined pursuant to paragraph (5) of
this subsection. It is the intent of the General Assembly
that the adjustments required under this paragraph (6) by
Public Act 100-1181 this amendatory Act of the 100th
General Assembly shall be applied retroactively to claims
for dates of service provided on or after July 1, 2018.
(7) Effective for dates of service on or after March 8,
2019 (the effective date of Public Act 100-1181) this

10100SB0115ham001 - 17 - LRB101 04834 KTG 64192 a
amendatory Act of the 100th General Assembly, the
Department shall recalculate and implement an updated
statewide-standardized amount for outpatient services
provided by hospitals that are not Critical Access
Hospitals to reflect the applicable uniform percentage
determined pursuant to paragraph (5).
(1) Any recalculation to the
statewide-standardized amounts for outpatient services
provided by hospitals that are not Critical Access
Hospitals shall be the amount necessary to achieve the
increase in the statewide-standardized amounts for
outpatient services increased by a uniform percentage,
so that base claims projected reimbursement is
increased by an amount equal to no less than the funds
allocated in paragraph (1) of subsection (b) of Section
5A-12.6, less the amount allocated under paragraphs
(8) and (9) of subsection (a) and paragraphs (3) and
(4) of this subsection, for all hospitals that are not
Critical Access Hospitals, multiplied by 46%.
(2) It is the intent of the General Assembly that
the recalculations required under this paragraph (7)
by Public Act 100-1181 this amendatory Act of the 100th
General Assembly shall be applied prospectively to
claims for dates of service provided on or after March
8, 2019 (the effective date of Public Act 100-1181)
this amendatory Act of the 100th General Assembly and

10100SB0115ham001 - 18 - LRB101 04834 KTG 64192 a
that no recoupment or repayment by the Department or an
MCO of payments attributable to recalculation under
this paragraph (7), issued to the hospital for dates of
service on or after July 1, 2018 and before March 8,
2019 (the effective date of Public Act 100-1181) this
amendatory Act of the 100th General Assembly, shall be
permitted.
(8) The Department shall ensure that all necessary
adjustments to the managed care organization capitation
base rates necessitated by the adjustments under
subparagraph (6) or (7) of this subsection are completed
and applied retroactively in accordance with Section
5-30.8 of this Code within 90 days of March 8, 2019 (the
effective date of Public Act 100-1181) this amendatory Act
of the 100th General Assembly.
(c) In consultation with the hospital community, the
Department is authorized to replace 89 Ill. Admin. Code 152.150
as published in 38 Ill. Reg. 4980 through 4986 within 12 months
of June 16, 2014 (the effective date of Public Act 98-651). If
the Department does not replace these rules within 12 months of
June 16, 2014 (the effective date of Public Act 98-651), the
rules in effect for 152.150 as published in 38 Ill. Reg. 4980
through 4986 shall remain in effect until modified by rule by
the Department. Nothing in this subsection shall be construed
to mandate that the Department file a replacement rule.
(d) Transition period. There shall be a transition period

10100SB0115ham001 - 19 - LRB101 04834 KTG 64192 a
to the reimbursement systems authorized under this Section that
shall begin on the effective date of these systems and continue
until June 30, 2018, unless extended by rule by the Department.
To help provide an orderly and predictable transition to the
new reimbursement systems and to preserve and enhance access to
the hospital services during this transition, the Department
shall allocate a transitional hospital access pool of at least
$290,000,000 annually so that transitional hospital access
payments are made to hospitals.
(1) After the transition period, the Department may
begin incorporating the transitional hospital access pool
into the base rate structure; however, the transitional
hospital access payments in effect on June 30, 2018 shall
continue to be paid, if continued under Section 5A-16.
(2) After the transition period, if the Department
reduces payments from the transitional hospital access
pool, it shall increase base rates, develop new adjustors,
adjust current adjustors, develop new hospital access
payments based on updated information, or any combination
thereof by an amount equal to the decreases proposed in the
transitional hospital access pool payments, ensuring that
the entire transitional hospital access pool amount shall
continue to be used for hospital payments.
(d-5) Hospital transformation program. The Department, in
conjunction with the Hospital Transformation Review Committee
created under subsection (d-5), shall develop a hospital

10100SB0115ham001 - 20 - LRB101 04834 KTG 64192 a
transformation program to provide financial assistance to
hospitals in transforming their services and care models to
better align with the needs of the communities they serve. The
payments authorized in this Section shall be subject to
approval by the federal government.
(1) Phase 1. In State fiscal years 2019 through 2020,
the Department shall allocate funds from the transitional
access hospital pool to create a hospital transformation
pool of at least $262,906,870 annually and make hospital
transformation payments to hospitals. Subject to Section
5A-16, in State fiscal years 2019 and 2020, an Illinois
hospital that received either a transitional hospital
access payment under subsection (d) or a supplemental
payment under subsection (f) of this Section in State
fiscal year 2018, shall receive a hospital transformation
payment as follows:
(A) If the hospital's Rate Year 2017 Medicaid
inpatient utilization rate is equal to or greater than
45%, the hospital transformation payment shall be
equal to 100% of the sum of its transitional hospital
access payment authorized under subsection (d) and any
supplemental payment authorized under subsection (f).
(B) If the hospital's Rate Year 2017 Medicaid
inpatient utilization rate is equal to or greater than
25% but less than 45%, the hospital transformation
payment shall be equal to 75% of the sum of its

10100SB0115ham001 - 21 - LRB101 04834 KTG 64192 a
transitional hospital access payment authorized under
subsection (d) and any supplemental payment authorized
under subsection (f).
(C) If the hospital's Rate Year 2017 Medicaid
inpatient utilization rate is less than 25%, the
hospital transformation payment shall be equal to 50%
of the sum of its transitional hospital access payment
authorized under subsection (d) and any supplemental
payment authorized under subsection (f).
(2) Phase 2. During State fiscal years 2021 and 2022,
the Department shall allocate funds from the transitional
access hospital pool to create a hospital transformation
pool annually and make hospital transformation payments to
hospitals participating in the transformation program. Any
hospital may seek transformation funding in Phase 2. Any
hospital that seeks transformation funding in Phase 2 to
update or repurpose the hospital's physical structure to
transition to a new delivery model, must submit to the
Department in writing a transformation plan, based on the
Department's guidelines, that describes the desired
delivery model with projections of patient volumes by
service lines and projected revenues, expenses, and net
income that correspond to the new delivery model. In Phase
2, subject to the approval of rules, the Department may use
the hospital transformation pool to increase base rates,
develop new adjustors, adjust current adjustors, or

10100SB0115ham001 - 22 - LRB101 04834 KTG 64192 a
develop new access payments in order to support and
incentivize hospitals to pursue such transformation. In
developing such methodologies, the Department shall ensure
that the entire hospital transformation pool continues to
be expended to ensure access to hospital services or to
support organizations that had received hospital
transformation payments under this Section.
(A) Any hospital participating in the hospital
transformation program shall provide an opportunity
for public input by local community groups, hospital
workers, and healthcare professionals and assist in
facilitating discussions about any transformations or
changes to the hospital.
(B) As provided in paragraph (9) of Section 3 of
the Illinois Health Facilities Planning Act, any
hospital participating in the transformation program
may be excluded from the requirements of the Illinois
Health Facilities Planning Act for those projects
related to the hospital's transformation. To be
eligible, the hospital must submit to the Health
Facilities and Services Review Board certification
from the Department, approved by the Hospital
Transformation Review Committee, that the project is a
part of the hospital's transformation.
(C) As provided in subsection (a-20) of Section
32.5 of the Emergency Medical Services (EMS) Systems

10100SB0115ham001 - 23 - LRB101 04834 KTG 64192 a
Act, a hospital that received hospital transformation
payments under this Section may convert to a
freestanding emergency center. To be eligible for such
a conversion, the hospital must submit to the
Department of Public Health certification from the
Department, approved by the Hospital Transformation
Review Committee, that the project is a part of the
hospital's transformation.
(2.5) The hospital transformation payment amount
allocated to a facility in State fiscal years 2019 through
2020 as provided under paragraph (1) shall not be reduced
or altered during State fiscal years 2021 and 2022 if:
(i) the facility is located in a county having a
population of more than 3,000,000; and
(ii) the facility was a licensed general acute care
hospital that discontinued operations as a hospital on
October 22, 2019 and has a Health Facilities and
Services Review Board project number of E-024-19.
The hospital transformation payment amount shall
instead be paid to any entity that purchases the facility
for the purpose of converting the facility to a
freestanding emergency center as provided in subsection
(a-7) of Section 32.5 of the Emergency Medical Services
(EMS) Systems Act, pending approval by the Health
Facilities and Services Review Board of the permit to
establish a freestanding emergency center as defined by the

10100SB0115ham001 - 24 - LRB101 04834 KTG 64192 a
Health Facilities and Services Review Board.
(3) By April 1, 2019, March 12, 2018 (Public Act
100-581) the Department, in conjunction with the Hospital
Transformation Review Committee, shall develop and file as
an administrative rule with the Secretary of State the
goals, objectives, policies, standards, payment models, or
criteria to be applied in Phase 2 of the program to
allocate the hospital transformation funds. The goals,
objectives, and policies to be considered may include, but
are not limited to, achieving unmet needs of a community
that a hospital serves such as behavioral health services,
outpatient services, or drug rehabilitation services;
attaining certain quality or patient safety benchmarks for
health care services; or improving the coordination,
effectiveness, and efficiency of care delivery.
Notwithstanding any other provision of law, any rule
adopted in accordance with this subsection (d-5) may be
submitted to the Joint Committee on Administrative Rules
for approval only if the rule has first been approved by 9
of the 14 members of the Hospital Transformation Review
Committee.
(4) Hospital Transformation Review Committee. There is
created the Hospital Transformation Review Committee. The
Committee shall consist of 14 members. No later than 30
days after March 12, 2018 (the effective date of Public Act
100-581), the 4 legislative leaders shall each appoint 3

10100SB0115ham001 - 25 - LRB101 04834 KTG 64192 a
members; the Governor shall appoint the Director of
Healthcare and Family Services, or his or her designee, as
a member; and the Director of Healthcare and Family
Services shall appoint one member. Any vacancy shall be
filled by the applicable appointing authority within 15
calendar days. The members of the Committee shall select a
Chair and a Vice-Chair from among its members, provided
that the Chair and Vice-Chair cannot be appointed by the
same appointing authority and must be from different
political parties. The Chair shall have the authority to
establish a meeting schedule and convene meetings of the
Committee, and the Vice-Chair shall have the authority to
convene meetings in the absence of the Chair. The Committee
may establish its own rules with respect to meeting
schedule, notice of meetings, and the disclosure of
documents; however, the Committee shall not have the power
to subpoena individuals or documents and any rules must be
approved by 9 of the 14 members. The Committee shall
perform the functions described in this Section and advise
and consult with the Director in the administration of this
Section. In addition to reviewing and approving the
policies, procedures, and rules for the hospital
transformation program, the Committee shall consider and
make recommendations related to qualifying criteria and
payment methodologies related to safety-net hospitals and
children's hospitals. Members of the Committee appointed

10100SB0115ham001 - 26 - LRB101 04834 KTG 64192 a
by the legislative leaders shall be subject to the
jurisdiction of the Legislative Ethics Commission, not the
Executive Ethics Commission, and all requests under the
Freedom of Information Act shall be directed to the
applicable Freedom of Information officer for the General
Assembly. The Department shall provide operational support
to the Committee as necessary. The Committee is dissolved
on April 1, 2019.
(e) Beginning 36 months after initial implementation, the
Department shall update the reimbursement components in
subsections (a) and (b), including standardized amounts and
weighting factors, and at least triennially and no more
frequently than annually thereafter. The Department shall
publish these updates on its website no later than 30 calendar
days prior to their effective date.
(f) Continuation of supplemental payments. Any
supplemental payments authorized under Illinois Administrative
Code 148 effective January 1, 2014 and that continue during the
period of July 1, 2014 through December 31, 2014 shall remain
in effect as long as the assessment imposed by Section 5A-2
that is in effect on December 31, 2017 remains in effect.
(g) Notwithstanding subsections (a) through (f) of this
Section and notwithstanding the changes authorized under
Section 5-5b.1, any updates to the system shall not result in
any diminishment of the overall effective rates of
reimbursement as of the implementation date of the new system

10100SB0115ham001 - 27 - LRB101 04834 KTG 64192 a
(July 1, 2014). These updates shall not preclude variations in
any individual component of the system or hospital rate
variations. Nothing in this Section shall prohibit the
Department from increasing the rates of reimbursement or
developing payments to ensure access to hospital services.
Nothing in this Section shall be construed to guarantee a
minimum amount of spending in the aggregate or per hospital as
spending may be impacted by factors, including, but not limited
to, the number of individuals in the medical assistance program
and the severity of illness of the individuals.
(h) The Department shall have the authority to modify by
rulemaking any changes to the rates or methodologies in this
Section as required by the federal government to obtain federal
financial participation for expenditures made under this
Section.
(i) Except for subsections (g) and (h) of this Section, the
Department shall, pursuant to subsection (c) of Section 5-40 of
the Illinois Administrative Procedure Act, provide for
presentation at the June 2014 hearing of the Joint Committee on
Administrative Rules (JCAR) additional written notice to JCAR
of the following rules in order to commence the second notice
period for the following rules: rules published in the Illinois
Register, rule dated February 21, 2014 at 38 Ill. Reg. 4559
(Medical Payment), 4628 (Specialized Health Care Delivery
Systems), 4640 (Hospital Services), 4932 (Diagnostic Related
Grouping (DRG) Prospective Payment System (PPS)), and 4977

10100SB0115ham001 - 28 - LRB101 04834 KTG 64192 a
(Hospital Reimbursement Changes), and published in the
Illinois Register dated March 21, 2014 at 38 Ill. Reg. 6499
(Specialized Health Care Delivery Systems) and 6505 (Hospital
Services).
(j) Out-of-state hospitals. Beginning July 1, 2018, for
purposes of determining for State fiscal years 2019 and 2020
the hospitals eligible for the payments authorized under
subsections (a) and (b) of this Section, the Department shall
include out-of-state hospitals that are designated a Level I
pediatric trauma center or a Level I trauma center by the
Department of Public Health as of December 1, 2017.
(k) The Department shall notify each hospital and managed
care organization, in writing, of the impact of the updates
under this Section at least 30 calendar days prior to their
effective date.
(Source: P.A. 100-581, eff. 3-12-18; 100-1181, eff. 3-8-19;
101-0081, eff. 7-12-19; revised 7-29-19.)
Section 99. Effective date. This Act takes effect upon
becoming law.".