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art.012/2/012/1

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ARTICLE 12 AS AMENDED

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RELATING TO HOSPITAL UNCOMPENSATED CARE

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     SECTION 1. Sections 40-8.3-2 and 40-8.3-3 of the General Laws in Chapter 40-8.3

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entitled "Uncompensated Care" are hereby amended to read as follows:

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     40-8.3-2. Definitions. -- As used in this chapter:

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     (1) "Base year" means for the purpose of calculating a disproportionate share payment for

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any fiscal year ending after September 30, 2011 2012, the period from October 1, 2009 2010

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through September 30, 2010 2011, and for any fiscal year ending after September 30, 2012 2013,

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the period from October 1, 2010 2011 through September 30, 20112012.

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     (2) "Medical assistance inpatient utilization rate for a hospital" means a fraction

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(expressed as a percentage) the numerator of which is the hospital's number of inpatient days

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during the base year attributable to patients who were eligible for medical assistance during the

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base year and the denominator of which is the total number of the hospital's inpatient days in the

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base year.

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     (3) "Participating hospital" means any nongovernment and nonpsychiatric hospital that:

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(i) was licensed as a hospital in accordance with chapter 17 of title 23 during the base year; (ii)

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achieved a medical assistance inpatient utilization rate of at least one percent (1%) during the

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base year; and (iii) continues to be licensed as a hospital in accordance with chapter 17 of title 23

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during the payment year.

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     (4) "Uncompensated care costs" means, as to any hospital, the sum of: (i) the cost

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incurred by such hospital during the base year for inpatient or outpatient services attributable to

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charity care (free care and bad debts) for which the patient has no health insurance or other third-

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party coverage less payments, if any, received directly from such patients; and (ii) the cost

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incurred by such hospital during the base year for inpatient or out-patient services attributable to

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Medicaid beneficiaries less any Medicaid reimbursement received therefor; multiplied by the

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uncompensated care index.

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     (5) "Uncompensated care index" means the annual percentage increase for hospitals

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established pursuant to § 27-19-14 for each year after the base year, up to and including the

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payment year, provided, however, that the uncompensated care index for the payment year ending

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September 30, 2007 shall be deemed to be five and thirty-eight hundredths percent (5.38%), and

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that the uncompensated care index for the payment year ending September 30, 2008 shall be

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deemed to be five and forty-seven hundredths percent (5.47%), and that the uncompensated care

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index for the payment year ending September 30, 2009 shall be deemed to be five and thirty-eight

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hundredths percent (5.38%), and that the uncompensated care index for the payment years ending

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September 30, 2010, September 30, 2011, September 30, 2012, and, September 30, 2013 and

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September 30, 2014 shall be deemed to be five and thirty hundredths percent (5.30%).

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     40-8.3-3. Implementation. -- (a) For the fiscal year commencing on October 1, 2010 and

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ending September 30, 2011, the department of human services shall submit to the Secretary of the

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U.S. Department of Health and Human Services a state plan amendment to the Rhode Island

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Medicaid state plan for disproportionate share hospital payments (DSH Plan) to provide:

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     (1) That the disproportionate share hospital payments to all participating hospitals not to

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exceed an aggregate limit of $125.4 million, to be allocated by the department to the Pool A, Pool

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C and Pool D components of the DSH Plan;

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     (2) That the Pool D allotment shall be distributed among the participating hospitals in

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direct proportion to the individual participating hospital's uncompensated care costs for the base

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year, inflated by the uncompensated care index to the total uncompensated care costs for the base

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year inflated by uncompensated care index for all participating hospitals. The disproportionate

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share payments shall be made on or before July 18, 2011 and are expressly conditioned upon

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approval on or before July 11, 2011 by the Secretary of the U.S. Department of Health and

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Human Services, or his or her authorized representative, of all Medicaid state plan amendments

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necessary to secure for the state the benefit of federal financial participation in federal fiscal year

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2011 for the disproportionate share payments.

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     (b)(a) For the fiscal year commencing on October 1, 2011 and ending September 30,

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2012, the executive office of health and human services shall submit to the Secretary of the U.S.

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Department of Health and Human Services a state plan amendment to the Rhode Island Medicaid

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state plan for disproportionate share hospital payments (DSH Plan) to provide:

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     (1) That the disproportionate share hospital payments to all participating hospitals, not to

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exceed an aggregate limit of $126.2 million, shall be allocated by the executive office of health

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and human services to the Pool A, Pool C and Pool D components of the DSH Plan; and,

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     (2) That the Pool D allotment shall be distributed among the participating hospitals in

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direct proportion to the individual participating hospital's uncompensated care costs for the base

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year, inflated by the uncompensated care index to the total uncompensated care costs for the base

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year inflated by uncompensated care index for all participating hospitals. The disproportionate

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share payments shall be made on or before July 16, 2012 and are expressly conditioned upon

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approval on or before July 9, 2012 by the Secretary of the U.S. Department of Health and Human

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Services, or his or her authorized representative, of all Medicaid state plan amendments necessary

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to secure for the state the benefit of federal financial participation in federal fiscal year 2012 for

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the disproportionate share payments.

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     (c)(b) For federal fiscal year 2013, commencing on October 1, 2012 and ending

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September 30, 2013, the executive office of health and human services shall submit to the

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Secretary of the U.S. Department of Health and Human Services a state plan amendment to the

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Rhode Island Medicaid state plan for disproportionate share hospital payments (DSH Plan) to

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provide:

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     (1) That the disproportionate share hospital payments to all participating hospitals, not to

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exceed an aggregate limit of $128.3 million, shall be allocated by the executive office of health

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and human services to the Pool A, Pool C and Pool D components of the DSH Plan; and,

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     (2) That the Pool D allotment shall be distributed among the participating hospitals in

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direct proportion to the individual participating hospital's uncompensated care costs for the base

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year, inflated by the uncompensated care index to the total uncompensated care costs for the base

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year inflated by uncompensated care index for all participating hospitals. The disproportionate

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share payments shall be made on or before July 15, 2013 and are expressly conditioned upon

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approval on or before July 8, 2013 by the Secretary of the U.S. Department of Health and Human

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Services, or his or her authorized representative, of all Medicaid state plan amendments necessary

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to secure for the state the benefit of federal financial participation in federal fiscal year 2013 for

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the disproportionate share payments.

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     (c) For federal fiscal year 2014, commencing on October 1, 2013 and ending September

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30, 2014, the executive office of health and human services shall submit to the Secretary of the

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U.S. Department of Health and Human Services a state plan amendment to the Rhode Island

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Medicaid state plan for disproportionate share hospital payments (DSH Plan) to provide:

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     (1) That the disproportionate share hospital payments to all participating hospitals, not to

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exceed an aggregate limit of $128.3 million, shall be allocated by the executive office of health

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and human services to the Pool A, Pool C and Pool D components of the DSH Plan; and,

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     (2) That the Pool D allotment shall be distributed among the participating hospitals in

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direct proportion to the individual participating hospital's uncompensated care costs for the base

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year, inflated by the uncompensated care index to the total uncompensated care costs for the base

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year inflated by uncompensated care index for all participating hospitals. The disproportionate

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share payments shall be made on or before July 14, 2014 and are expressly conditioned upon

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approval on or before July 7, 2014 by the Secretary of the U.S. Department of Health and Human

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Services, or his or her authorized representative, of all Medicaid state plan amendments necessary

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to secure for the state the benefit of federal financial participation in federal fiscal year 2014 for

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the disproportionate share payments.

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     (d) No provision is made pursuant to this chapter for disproportionate share hospital

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payments to participating hospitals for uncompensated care costs related to graduate medical

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education programs.

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     SECTION 2. This article shall take effect upon passage.