Bill Text: IL HB2994 | 2017-2018 | 100th General Assembly | Introduced

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Bill Title: Amends the Hospital Provider Funding Article of the Illinois Public Aid Code. Extends the period of time certain hospital assessments are imposed through State fiscal year 2020. Effective July 1, 2017.

Spectrum: Partisan Bill (Democrat 2-0)

Status: (Failed) 2019-01-08 - Session Sine Die [HB2994 Detail]

Download: Illinois-2017-HB2994-Introduced.html

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100TH GENERAL ASSEMBLY State of Illinois 2017 and 2018 HB2994 Introduced , by Rep. Camille Y. Lilly SYNOPSIS AS INTRODUCED:
305 ILCS 5/5-5e.1
305 ILCS 5/5A-2 from Ch. 23, par. 5A-2
305 ILCS 5/5A-5 from Ch. 23, par. 5A-5
305 ILCS 5/5A-8 from Ch. 23, par. 5A-8
305 ILCS 5/5A-10 from Ch. 23, par. 5A-10
305 ILCS 5/5A-12.5
305 ILCS 5/5A-14
305 ILCS 5/12-4.105
305 ILCS 5/14-12
Amends the Hospital Provider Funding Article of the Illinois Public Aid Code. Extends the period of time certain hospital assessments are imposed through State fiscal year 2020. Effective July 1, 2017.
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FISCAL NOTE ACT MAY APPLY
A BILL FOR
HB2994 LRB100 08641 KTG 18775 b
AN ACT concerning public aid.
Be it enacted by the People of the State of Illinois,
represented in the General Assembly:
Section 5. The Illinois Public Aid Code is amended by
changing Sections 5-5e.1, 5A-2, 5A-5, 5A-8, 5A-10, 5A-12.5,
5A-14, 12-4.105, and 14-12 as follows:
(305 ILCS 5/5-5e.1)
Sec. 5-5e.1. Safety-Net Hospitals.
(a) A Safety-Net Hospital is an Illinois hospital that:
(1) is licensed by the Department of Public Health as a
general acute care or pediatric hospital; and
(2) is a disproportionate share hospital, as described
in Section 1923 of the federal Social Security Act, as
determined by the Department; and
(3) meets one of the following:
(A) has a MIUR of at least 40% and a charity
percent of at least 4%; or
(B) has a MIUR of at least 50%.
(b) Definitions. As used in this Section:
(1) "Charity percent" means the ratio of (i) the
hospital's charity charges for services provided to
individuals without health insurance or another source of
third party coverage to (ii) the Illinois total hospital

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charges, each as reported on the hospital's OBRA form.
(2) "MIUR" means Medicaid Inpatient Utilization Rate
and is defined as a fraction, the numerator of which is the
number of a hospital's inpatient days provided in the
hospital's fiscal year ending 3 years prior to the rate
year, to patients who, for such days, were eligible for
Medicaid under Title XIX of the federal Social Security
Act, 42 USC 1396a et seq., excluding those persons eligible
for medical assistance pursuant to 42 U.S.C.
1396a(a)(10)(A)(i)(VIII) as set forth in paragraph 18 of
Section 5-2 of this Article, and the denominator of which
is the total number of the hospital's inpatient days in
that same period, excluding those persons eligible for
medical assistance pursuant to 42 U.S.C.
1396a(a)(10)(A)(i)(VIII) as set forth in paragraph 18 of
Section 5-2 of this Article.
(3) "OBRA form" means form HFS-3834, OBRA '93 data
collection form, for the rate year.
(4) "Rate year" means the 12-month period beginning on
October 1.
(c) Beginning July 1, 2012 and ending on June 30, 2020
2018, a hospital that would have qualified for the rate year
beginning October 1, 2011, shall be a Safety-Net Hospital.
(d) No later than August 15 preceding the rate year, each
hospital shall submit the OBRA form to the Department. Prior to
October 1, the Department shall notify each hospital whether it

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has qualified as a Safety-Net Hospital.
(e) The Department may promulgate rules in order to
implement this Section.
(f) Nothing in this Section shall be construed as limiting
the ability of the Department to include the Safety-Net
Hospitals in the hospital rate reform mandated by Section 14-11
of this Code and implemented under Section 14-12 of this Code
and by administrative rulemaking.
(Source: P.A. 97-689, eff. 6-14-12; 98-104, eff. 7-22-13;
98-651, eff. 6-16-14.)
(305 ILCS 5/5A-2) (from Ch. 23, par. 5A-2)
(Section scheduled to be repealed on July 1, 2018)
Sec. 5A-2. Assessment.
(a)(1) Subject to Sections 5A-3 and 5A-10, for State fiscal
years 2009 through 2020 2018, an annual assessment on inpatient
services is imposed on each hospital provider in an amount
equal to $218.38 multiplied by the difference of the hospital's
occupied bed days less the hospital's Medicare bed days,
provided, however, that the amount of $218.38 shall be
increased by a uniform percentage to generate an amount equal
to 75% of the State share of the payments authorized under
Section 5A-12.5, with such increase only taking effect upon the
date that a State share for such payments is required under
federal law. For the period of April through June 2015, the
amount of $218.38 used to calculate the assessment under this

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paragraph shall, by emergency rule under subsection (s) of
Section 5-45 of the Illinois Administrative Procedure Act, be
increased by a uniform percentage to generate $20,250,000 in
the aggregate for that period from all hospitals subject to the
annual assessment under this paragraph.
(2) In addition to any other assessments imposed under this
Article, effective July 1, 2016 and semi-annually thereafter
through June 2020 2018, in addition to any federally required
State share as authorized under paragraph (1), the amount of
$218.38 shall be increased by a uniform percentage to generate
an amount equal to 75% of the ACA Assessment Adjustment, as
defined in subsection (b-6) of this Section.
For State fiscal years 2009 through 2020 2014 and after, a
hospital's occupied bed days and Medicare bed days shall be
determined using the most recent data available from each
hospital's 2005 Medicare cost report as contained in the
Healthcare Cost Report Information System file, for the quarter
ending on December 31, 2006, without regard to any subsequent
adjustments or changes to such data. If a hospital's 2005
Medicare cost report is not contained in the Healthcare Cost
Report Information System, then the Illinois Department may
obtain the hospital provider's occupied bed days and Medicare
bed days from any source available, including, but not limited
to, records maintained by the hospital provider, which may be
inspected at all times during business hours of the day by the
Illinois Department or its duly authorized agents and

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employees.
(b) (Blank).
(b-5)(1) Subject to Sections 5A-3 and 5A-10, for the
portion of State fiscal year 2012, beginning June 10, 2012
through June 30, 2012, and for State fiscal years 2013 through
2020 2018, an annual assessment on outpatient services is
imposed on each hospital provider in an amount equal to .008766
multiplied by the hospital's outpatient gross revenue,
provided, however, that the amount of .008766 shall be
increased by a uniform percentage to generate an amount equal
to 25% of the State share of the payments authorized under
Section 5A-12.5, with such increase only taking effect upon the
date that a State share for such payments is required under
federal law. For the period beginning June 10, 2012 through
June 30, 2012, the annual assessment on outpatient services
shall be prorated by multiplying the assessment amount by a
fraction, the numerator of which is 21 days and the denominator
of which is 365 days. For the period of April through June
2015, the amount of .008766 used to calculate the assessment
under this paragraph shall, by emergency rule under subsection
(s) of Section 5-45 of the Illinois Administrative Procedure
Act, be increased by a uniform percentage to generate
$6,750,000 in the aggregate for that period from all hospitals
subject to the annual assessment under this paragraph.
(2) In addition to any other assessments imposed under this
Article, effective July 1, 2016 and semi-annually thereafter

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through June 2020 2018, in addition to any federally required
State share as authorized under paragraph (1), the amount of
.008766 shall be increased by a uniform percentage to generate
an amount equal to 25% of the ACA Assessment Adjustment, as
defined in subsection (b-6) of this Section.
For the portion of State fiscal year 2012, beginning June
10, 2012 through June 30, 2012, and State fiscal years 2013
through 2020 2018, a hospital's outpatient gross revenue shall
be determined using the most recent data available from each
hospital's 2009 Medicare cost report as contained in the
Healthcare Cost Report Information System file, for the quarter
ending on June 30, 2011, without regard to any subsequent
adjustments or changes to such data. If a hospital's 2009
Medicare cost report is not contained in the Healthcare Cost
Report Information System, then the Department may obtain the
hospital provider's outpatient gross revenue from any source
available, including, but not limited to, records maintained by
the hospital provider, which may be inspected at all times
during business hours of the day by the Department or its duly
authorized agents and employees.
(b-6)(1) As used in this Section, "ACA Assessment
Adjustment" means:
(A) For the period of July 1, 2016 through December 31,
2016, the product of .19125 multiplied by the sum of the
fee-for-service payments to hospitals as authorized under
Section 5A-12.5 and the adjustments authorized under

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subsection (t) of Section 5A-12.2 to managed care
organizations for hospital services due and payable in the
month of April 2016 multiplied by 6.
(B) For the period of January 1, 2017 through June 30,
2017, the product of .19125 multiplied by the sum of the
fee-for-service payments to hospitals as authorized under
Section 5A-12.5 and the adjustments authorized under
subsection (t) of Section 5A-12.2 to managed care
organizations for hospital services due and payable in the
month of October 2016 multiplied by 6, except that the
amount calculated under this subparagraph (B) shall be
adjusted, either positively or negatively, to account for
the difference between the actual payments issued under
Section 5A-12.5 for the period beginning July 1, 2016
through December 31, 2016 and the estimated payments due
and payable in the month of April 2016 multiplied by 6 as
described in subparagraph (A).
(C) For the period of July 1, 2017 through December 31,
2017, the product of .19125 multiplied by the sum of the
fee-for-service payments to hospitals as authorized under
Section 5A-12.5 and the adjustments authorized under
subsection (t) of Section 5A-12.2 to managed care
organizations for hospital services due and payable in the
month of April 2017 multiplied by 6, except that the amount
calculated under this subparagraph (C) shall be adjusted,
either positively or negatively, to account for the

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difference between the actual payments issued under
Section 5A-12.5 for the period beginning January 1, 2017
through June 30, 2017 and the estimated payments due and
payable in the month of October 2016 multiplied by 6 as
described in subparagraph (B).
(D) For the period of January 1, 2018 through June 30,
2018, the product of .19125 multiplied by the sum of the
fee-for-service payments to hospitals as authorized under
Section 5A-12.5 and the adjustments authorized under
subsection (t) of Section 5A-12.2 to managed care
organizations for hospital services due and payable in the
month of October 2017 multiplied by 6, except that:
(i) the amount calculated under this subparagraph
(D) shall be adjusted, either positively or
negatively, to account for the difference between the
actual payments issued under Section 5A-12.5 for the
period of July 1, 2017 through December 31, 2017 and
the estimated payments due and payable in the month of
April 2017 multiplied by 6 as described in subparagraph
(C); and
(ii) the amount calculated under this subparagraph
(D) shall be adjusted to include the product of .19125
multiplied by the sum of the fee-for-service payments,
if any, estimated to be paid to hospitals under
subsection (b) of Section 5A-12.5.
(1.5) Subject to federal approval, payments made under

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subparagraphs (A), (B), (C), and (D) shall continue through
December 31, 2019.
(2) The Department shall complete and apply a final
reconciliation of the ACA Assessment Adjustment prior to June
30, 2018 to account for:
(A) any differences between the actual payments issued
or scheduled to be issued prior to June 30, 2018 as
authorized in Section 5A-12.5 for the period of January 1,
2018 through June 30, 2020 2018 and the estimated payments
due and payable in the month of October 2017 multiplied by
6 as described in subparagraph (D); and
(B) any difference between the estimated
fee-for-service payments under subsection (b) of Section
5A-12.5 and the amount of such payments that are actually
scheduled to be paid.
The Department shall notify hospitals of any additional
amounts owed or reduction credits to be applied to the June
2018 ACA Assessment Adjustment. This is to be considered the
final reconciliation for the ACA Assessment Adjustment.
(3) Notwithstanding any other provision of this Section, if
for any reason the scheduled payments under subsection (b) of
Section 5A-12.5 are not issued in full by the final day of the
period authorized under subsection (b) of Section 5A-12.5,
funds collected from each hospital pursuant to subparagraph (D)
of paragraph (1) and pursuant to paragraph (2), attributable to
the scheduled payments authorized under subsection (b) of

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Section 5A-12.5 that are not issued in full by the final day of
the period attributable to each payment authorized under
subsection (b) of Section 5A-12.5, shall be refunded.
(4) The increases authorized under paragraph (2) of
subsection (a) and paragraph (2) of subsection (b-5) shall be
limited to the federally required State share of the total
payments authorized under Section 5A-12.5 if the sum of such
payments yields an annualized amount equal to or less than
$450,000,000, or if the adjustments authorized under
subsection (t) of Section 5A-12.2 are found not to be
actuarially sound; however, this limitation shall not apply to
the fee-for-service payments described in subsection (b) of
Section 5A-12.5.
(c) (Blank).
(d) Notwithstanding any of the other provisions of this
Section, the Department is authorized to adopt rules to reduce
the rate of any annual assessment imposed under this Section,
as authorized by Section 5-46.2 of the Illinois Administrative
Procedure Act.
(e) Notwithstanding any other provision of this Section,
any plan providing for an assessment on a hospital provider as
a permissible tax under Title XIX of the federal Social
Security Act and Medicaid-eligible payments to hospital
providers from the revenues derived from that assessment shall
be reviewed by the Illinois Department of Healthcare and Family
Services, as the Single State Medicaid Agency required by

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federal law, to determine whether those assessments and
hospital provider payments meet federal Medicaid standards. If
the Department determines that the elements of the plan may
meet federal Medicaid standards and a related State Medicaid
Plan Amendment is prepared in a manner and form suitable for
submission, that State Plan Amendment shall be submitted in a
timely manner for review by the Centers for Medicare and
Medicaid Services of the United States Department of Health and
Human Services and subject to approval by the Centers for
Medicare and Medicaid Services of the United States Department
of Health and Human Services. No such plan shall become
effective without approval by the Illinois General Assembly by
the enactment into law of related legislation. Notwithstanding
any other provision of this Section, the Department is
authorized to adopt rules to reduce the rate of any annual
assessment imposed under this Section. Any such rules may be
adopted by the Department under Section 5-50 of the Illinois
Administrative Procedure Act.
(Source: P.A. 98-104, eff. 7-22-13; 98-651, eff. 6-16-14; 99-2,
eff. 3-26-15; 99-516, eff. 6-30-16.)
(305 ILCS 5/5A-5) (from Ch. 23, par. 5A-5)
Sec. 5A-5. Notice; penalty; maintenance of records.
(a) The Illinois Department shall send a notice of
assessment to every hospital provider subject to assessment
under this Article. The notice of assessment shall notify the

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hospital of its assessment and shall be sent after receipt by
the Department of notification from the Centers for Medicare
and Medicaid Services of the U.S. Department of Health and
Human Services that the payment methodologies required under
this Article and, if necessary, the waiver granted under 42 CFR
433.68 have been approved. The notice shall be on a form
prepared by the Illinois Department and shall state the
following:
(1) The name of the hospital provider.
(2) The address of the hospital provider's principal
place of business from which the provider engages in the
occupation of hospital provider in this State, and the name
and address of each hospital operated, conducted, or
maintained by the provider in this State.
(3) The occupied bed days, occupied bed days less
Medicare days, adjusted gross hospital revenue, or
outpatient gross revenue of the hospital provider
(whichever is applicable), the amount of assessment
imposed under Section 5A-2 for the State fiscal year for
which the notice is sent, and the amount of each
installment to be paid during the State fiscal year.
(4) (Blank).
(5) Other reasonable information as determined by the
Illinois Department.
(b) If a hospital provider conducts, operates, or maintains
more than one hospital licensed by the Illinois Department of

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Public Health, the provider shall pay the assessment for each
hospital separately.
(c) Notwithstanding any other provision in this Article, in
the case of a person who ceases to conduct, operate, or
maintain a hospital in respect of which the person is subject
to assessment under this Article as a hospital provider, the
assessment for the State fiscal year in which the cessation
occurs shall be adjusted by multiplying the assessment computed
under Section 5A-2 by a fraction, the numerator of which is the
number of days in the year during which the provider conducts,
operates, or maintains the hospital and the denominator of
which is 365. Immediately upon ceasing to conduct, operate, or
maintain a hospital, the person shall pay the assessment for
the year as so adjusted (to the extent not previously paid).
(d) Notwithstanding any other provision in this Article, a
provider who commences conducting, operating, or maintaining a
hospital, upon notice by the Illinois Department, shall pay the
assessment computed under Section 5A-2 and subsection (e) in
installments on the due dates stated in the notice and on the
regular installment due dates for the State fiscal year
occurring after the due dates of the initial notice.
(e) Notwithstanding any other provision in this Article,
for State fiscal years 2009 through 2020 2018, in the case of a
hospital provider that did not conduct, operate, or maintain a
hospital in 2005, the assessment for that State fiscal year
shall be computed on the basis of hypothetical occupied bed

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days for the full calendar year as determined by the Illinois
Department. Notwithstanding any other provision in this
Article, for the portion of State fiscal year 2012 beginning
June 10, 2012 through June 30, 2012, and for State fiscal years
2013 through 2020 2018, in the case of a hospital provider that
did not conduct, operate, or maintain a hospital in 2009, the
assessment under subsection (b-5) of Section 5A-2 for that
State fiscal year shall be computed on the basis of
hypothetical gross outpatient revenue for the full calendar
year as determined by the Illinois Department.
(f) Every hospital provider subject to assessment under
this Article shall keep sufficient records to permit the
determination of adjusted gross hospital revenue for the
hospital's fiscal year. All such records shall be kept in the
English language and shall, at all times during regular
business hours of the day, be subject to inspection by the
Illinois Department or its duly authorized agents and
employees.
(g) The Illinois Department may, by rule, provide a
hospital provider a reasonable opportunity to request a
clarification or correction of any clerical or computational
errors contained in the calculation of its assessment, but such
corrections shall not extend to updating the cost report
information used to calculate the assessment.
(h) (Blank).
(Source: P.A. 98-104, eff. 7-22-13; 98-463, eff. 8-16-13;

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98-651, eff. 6-16-14; 98-756, eff. 7-16-14; 99-78, eff.
7-20-15.)
(305 ILCS 5/5A-8) (from Ch. 23, par. 5A-8)
Sec. 5A-8. Hospital Provider Fund.
(a) There is created in the State Treasury the Hospital
Provider Fund. Interest earned by the Fund shall be credited to
the Fund. The Fund shall not be used to replace any moneys
appropriated to the Medicaid program by the General Assembly.
(b) The Fund is created for the purpose of receiving moneys
in accordance with Section 5A-6 and disbursing moneys only for
the following purposes, notwithstanding any other provision of
law:
(1) For making payments to hospitals as required under
this Code, under the Children's Health Insurance Program
Act, under the Covering ALL KIDS Health Insurance Act, and
under the Long Term Acute Care Hospital Quality Improvement
Transfer Program Act.
(2) For the reimbursement of moneys collected by the
Illinois Department from hospitals or hospital providers
through error or mistake in performing the activities
authorized under this Code.
(3) For payment of administrative expenses incurred by
the Illinois Department or its agent in performing
activities under this Code, under the Children's Health
Insurance Program Act, under the Covering ALL KIDS Health

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Insurance Act, and under the Long Term Acute Care Hospital
Quality Improvement Transfer Program Act.
(4) For payments of any amounts which are reimbursable
to the federal government for payments from this Fund which
are required to be paid by State warrant.
(5) For making transfers, as those transfers are
authorized in the proceedings authorizing debt under the
Short Term Borrowing Act, but transfers made under this
paragraph (5) shall not exceed the principal amount of debt
issued in anticipation of the receipt by the State of
moneys to be deposited into the Fund.
(6) For making transfers to any other fund in the State
treasury, but transfers made under this paragraph (6) shall
not exceed the amount transferred previously from that
other fund into the Hospital Provider Fund plus any
interest that would have been earned by that fund on the
monies that had been transferred.
(6.5) For making transfers to the Healthcare Provider
Relief Fund, except that transfers made under this
paragraph (6.5) shall not exceed $60,000,000 in the
aggregate.
(7) For making transfers not exceeding the following
amounts, related to State fiscal years 2013 through 2020
2018, to the following designated funds:
Health and Human Services Medicaid Trust
Fund..............................$20,000,000

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Long-Term Care Provider Fund..........$30,000,000
General Revenue Fund.................$80,000,000.
Transfers under this paragraph shall be made within 7 days
after the payments have been received pursuant to the
schedule of payments provided in subsection (a) of Section
5A-4.
(7.1) (Blank).
(7.5) (Blank).
(7.8) (Blank).
(7.9) (Blank).
(7.10) For State fiscal year 2014, for making transfers
of the moneys resulting from the assessment under
subsection (b-5) of Section 5A-2 and received from hospital
providers under Section 5A-4 and transferred into the
Hospital Provider Fund under Section 5A-6 to the designated
funds not exceeding the following amounts in that State
fiscal year:
Health Care Provider Relief Fund.....$100,000,000
Transfers under this paragraph shall be made within 7
days after the payments have been received pursuant to the
schedule of payments provided in subsection (a) of Section
5A-4.
The additional amount of transfers in this paragraph
(7.10), authorized by Public Act 98-651, shall be made
within 10 State business days after June 16, 2014 (the
effective date of Public Act 98-651). That authority shall

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remain in effect even if Public Act 98-651 does not become
law until State fiscal year 2015.
(7.10a) For State fiscal years 2015 through 2020 2018,
for making transfers of the moneys resulting from the
assessment under subsection (b-5) of Section 5A-2 and
received from hospital providers under Section 5A-4 and
transferred into the Hospital Provider Fund under Section
5A-6 to the designated funds not exceeding the following
amounts related to each State fiscal year:
Health Care Provider Relief Fund ....$50,000,000
Transfers under this paragraph shall be made within 7
days after the payments have been received pursuant to the
schedule of payments provided in subsection (a) of Section
5A-4.
(7.11) (Blank).
(7.12) For State fiscal year 2013, for increasing by
21/365ths the transfer of the moneys resulting from the
assessment under subsection (b-5) of Section 5A-2 and
received from hospital providers under Section 5A-4 for the
portion of State fiscal year 2012 beginning June 10, 2012
through June 30, 2012 and transferred into the Hospital
Provider Fund under Section 5A-6 to the designated funds
not exceeding the following amounts in that State fiscal
year:
Health Care Provider Relief Fund......$2,870,000
Since the federal Centers for Medicare and Medicaid

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Services approval of the assessment authorized under
subsection (b-5) of Section 5A-2, received from hospital
providers under Section 5A-4 and the payment methodologies
to hospitals required under Section 5A-12.4 was not
received by the Department until State fiscal year 2014 and
since the Department made retroactive payments during
State fiscal year 2014 related to the referenced period of
June 2012, the transfer authority granted in this paragraph
(7.12) is extended through the date that is 10 State
business days after June 16, 2014 (the effective date of
Public Act 98-651).
(7.13) In addition to any other transfers authorized
under this Section, for State fiscal years 2017 and 2020
2018, for making transfers to the Healthcare Provider
Relief Fund of moneys collected from the ACA Assessment
Adjustment authorized under subsections (a) and (b-5) of
Section 5A-2 and paid by hospital providers under Section
5A-4 into the Hospital Provider Fund under Section 5A-6 for
each State fiscal year. Timing of transfers to the
Healthcare Provider Relief Fund under this paragraph shall
be at the discretion of the Department, but no less
frequently than quarterly.
(8) For making refunds to hospital providers pursuant
to Section 5A-10.
(9) For making payment to capitated managed care
organizations as described in subsections (s) and (t) of

HB2994 - 20 - LRB100 08641 KTG 18775 b
Section 5A-12.2 of this Code.
Disbursements from the Fund, other than transfers
authorized under paragraphs (5) and (6) of this subsection,
shall be by warrants drawn by the State Comptroller upon
receipt of vouchers duly executed and certified by the Illinois
Department.
(c) The Fund shall consist of the following:
(1) All moneys collected or received by the Illinois
Department from the hospital provider assessment imposed
by this Article.
(2) All federal matching funds received by the Illinois
Department as a result of expenditures made by the Illinois
Department that are attributable to moneys deposited in the
Fund.
(3) Any interest or penalty levied in conjunction with
the administration of this Article.
(3.5) As applicable, proceeds from surety bond
payments payable to the Department as referenced in
subsection (s) of Section 5A-12.2 of this Code.
(4) Moneys transferred from another fund in the State
treasury.
(5) All other moneys received for the Fund from any
other source, including interest earned thereon.
(d) (Blank).
(Source: P.A. 98-104, eff. 7-22-13; 98-463, eff. 8-16-13;
98-651, eff. 6-16-14; 98-756, eff. 7-16-14; 99-78, eff.

HB2994 - 21 - LRB100 08641 KTG 18775 b
7-20-15; 99-516, eff. 6-30-16.)
(305 ILCS 5/5A-10) (from Ch. 23, par. 5A-10)
Sec. 5A-10. Applicability.
(a) The assessment imposed by subsection (a) of Section
5A-2 shall cease to be imposed and the Department's obligation
to make payments shall immediately cease, and any moneys
remaining in the Fund shall be refunded to hospital providers
in proportion to the amounts paid by them, if:
(1) The payments to hospitals required under this
Article are not eligible for federal matching funds under
Title XIX or XXI of the Social Security Act;
(2) For State fiscal years 2009 through 2020 2018, the
Department of Healthcare and Family Services adopts any
administrative rule change to reduce payment rates or
alters any payment methodology that reduces any payment
rates made to operating hospitals under the approved Title
XIX or Title XXI State plan in effect January 1, 2008
except for:
(A) any changes for hospitals described in
subsection (b) of Section 5A-3;
(B) any rates for payments made under this Article
V-A;
(C) any changes proposed in State plan amendment
transmittal numbers 08-01, 08-02, 08-04, 08-06, and
08-07;

HB2994 - 22 - LRB100 08641 KTG 18775 b
(D) in relation to any admissions on or after
January 1, 2011, a modification in the methodology for
calculating outlier payments to hospitals for
exceptionally costly stays, for hospitals reimbursed
under the diagnosis-related grouping methodology in
effect on July 1, 2011; provided that the Department
shall be limited to one such modification during the
36-month period after the effective date of this
amendatory Act of the 96th General Assembly;
(E) any changes affecting hospitals authorized by
Public Act 97-689;
(F) any changes authorized by Section 14-12 of this
Code, or for any changes authorized under Section 5A-15
of this Code; or
(G) any changes authorized under Section 5-5b.1.
(b) The assessment imposed by Section 5A-2 shall not take
effect or shall cease to be imposed, and the Department's
obligation to make payments shall immediately cease, if the
assessment is determined to be an impermissible tax under Title
XIX of the Social Security Act. Moneys in the Hospital Provider
Fund derived from assessments imposed prior thereto shall be
disbursed in accordance with Section 5A-8 to the extent federal
financial participation is not reduced due to the
impermissibility of the assessments, and any remaining moneys
shall be refunded to hospital providers in proportion to the
amounts paid by them.

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(c) The assessments imposed by subsection (b-5) of Section
5A-2 shall not take effect or shall cease to be imposed, the
Department's obligation to make payments shall immediately
cease, and any moneys remaining in the Fund shall be refunded
to hospital providers in proportion to the amounts paid by
them, if the payments to hospitals required under Section
5A-12.4 are not eligible for federal matching funds under Title
XIX of the Social Security Act.
(d) The assessments imposed by Section 5A-2 shall not take
effect or shall cease to be imposed, the Department's
obligation to make payments shall immediately cease, and any
moneys remaining in the Fund shall be refunded to hospital
providers in proportion to the amounts paid by them, if:
(1) for State fiscal years 2013 through 2020 2018, the
Department reduces any payment rates to hospitals as in
effect on May 1, 2012, or alters any payment methodology as
in effect on May 1, 2012, that has the effect of reducing
payment rates to hospitals, except for any changes
affecting hospitals authorized in Public Act 97-689 and any
changes authorized by Section 14-12 of this Code, and
except for any changes authorized under Section 5A-15, and
except for any changes authorized under Section 5-5b.1;
(2) for State fiscal years 2013 through 2020 2018, the
Department reduces any supplemental payments made to
hospitals below the amounts paid for services provided in
State fiscal year 2011 as implemented by administrative

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rules adopted and in effect on or prior to June 30, 2011,
except for any changes affecting hospitals authorized in
Public Act 97-689 and any changes authorized by Section
14-12 of this Code, and except for any changes authorized
under Section 5A-15, and except for any changes authorized
under Section 5-5b.1; or
(3) for State fiscal years 2015 through 2020 2018, the
Department reduces the overall effective rate of
reimbursement to hospitals below the level authorized
under Section 14-12 of this Code, except for any changes
under Section 14-12 or Section 5A-15 of this Code, and
except for any changes authorized under Section 5-5b.1.
(Source: P.A. 98-463, eff. 8-16-13; 98-651, eff. 6-16-14; 99-2,
eff. 3-26-15.)
(305 ILCS 5/5A-12.5)
Sec. 5A-12.5. Affordable Care Act adults; hospital access
payments.
(a) The Department shall, subject to federal approval,
mirror the Medical Assistance hospital reimbursement
methodology for Affordable Care Act adults who are enrolled
under a fee-for-service or capitated managed care program,
including hospital access payments as defined in Section
5A-12.2 of this Article and hospital access improvement
payments as defined in Section 5A-12.4 of this Article, in
compliance with the equivalent rate provisions of the

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Affordable Care Act.
(b) If the fee-for-service payments authorized under this
Section are deemed to be increases to payments for a prior
period, the Department shall seek federal approval to issue
such increases for the payments made through the period ending
on June 30, 2020 2018, even if such increases are paid out
during an extended payment period beyond such date. Payment of
such increases beyond such date is subject to federal approval.
(c) As used in this Section, "Affordable Care Act" is the
collective term for the Patient Protection and Affordable Care
Act (Pub. L. 111-148) and the Health Care and Education
Reconciliation Act of 2010 (Pub. L. 111-152).
(Source: P.A. 98-651, eff. 6-16-14; 99-516, eff. 6-30-16.)
(305 ILCS 5/5A-14)
Sec. 5A-14. Repeal of assessments and disbursements.
(a) Section 5A-2 is repealed on July 1, 2020 2018.
(b) Section 5A-12 is repealed on July 1, 2005.
(c) Section 5A-12.1 is repealed on July 1, 2008.
(d) Section 5A-12.2 and Section 5A-12.4 are repealed on
July 1, 2020 2018.
(e) Section 5A-12.3 is repealed on July 1, 2011.
(Source: P.A. 97-688, eff. 6-14-12; 97-689, eff. 6-14-12;
98-651, eff. 6-16-14.)
(305 ILCS 5/12-4.105)

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Sec. 12-4.105. Human poison control center; payment
program. Subject to funding availability resulting from
transfers made from the Hospital Provider Fund to the
Healthcare Provider Relief Fund as authorized under this Code,
for State fiscal year 2017 and State fiscal year 2020 2018, the
Department of Healthcare and Family Services shall pay to the
human poison control center designated under the Poison Control
System Act an amount of not less than $3,000,000 for each of
those State fiscal years that the human poison control center
is in operation.
(Source: P.A. 99-516, eff. 6-30-16.)
(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
the weighting factors as published by 3M Health Information
System, associated with Version 30.0 adjusted for the

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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
days prior to their effective date.
(6) Beginning July 1, 2014 and ending on June 30, 2018,

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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, 2018,
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.
(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 (E-APG) 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

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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.
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.
(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 the effective date of this amendatory Act of the 98th
General Assembly. If the Department does not replace these
rules within 12 months of the effective date of this amendatory

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Act of the 98th General Assembly, 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
to the reimbursement systems authorized under this Section that
shall begin on the effective date of these systems and continue
until June 30, 2020 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.
(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

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continue to be used for hospital payments.
(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 is
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
(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

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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
(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).
(Source: P.A. 98-651, eff. 6-16-14; 99-2, eff. 3-26-15.)
Section 99. Effective date. This Act takes effect July 1,
2017.