BILL NUMBER: AB 1383 AMENDED
BILL TEXT
AMENDED IN ASSEMBLY APRIL 30, 2009
INTRODUCED BY Assembly Member Jones
FEBRUARY 27, 2009
An act relating to hospitals, to add and
repeal Articles 5.21 (commencing with Section 14167.1) and 5.22
(commencing with Section 14167.31) of, Chapter 7 of Part 3 of
Division 9 of the Welfare and Institutions Code, relating to
Medi-Cal, making an appropriation therefor, and declaring the
urgency thereof, to take effect immediately.
LEGISLATIVE COUNSEL'S DIGEST
AB 1383, as amended, Jones. Hospitals: quality assurance
fee. Medi-Cal: hospitals: supplemental payments:
coverage dividend fee.
Existing law establishes the Medi-Cal program, administered by the
State Department of Health Care Services, under which basic health
care services are provided to qualified low-income persons. Under
existing law, the Medi-Cal Hospital/Uninsured Care Demonstration
Project Act, specified hospital reimbursement methodologies are
applied in order to maximize the use of federal funds consistent with
federal Medicaid law and stabilize the distribution of funding for
hospitals that provide care to Medi-Cal beneficiaries and uninsured
patients.
This bill, until January 1, 2011, would require the department to
pay specified hospitals supplemental amounts for certain hospital
services. This bill would require the Director of Health Care
Services to promptly seek the federal approvals and waivers that may
be necessary to implement the supplemental payment and obtain federal
financial participation to the maximum extent possible for the
supplemental payments made pursuant to the above-described
provisions.
This bill would, until January 1, 2011, require the department to
calculate and impose a coverage dividend fee on certain hospitals, as
specified. This bill would require the director to seek federal
approval of the fee and provides that if approval is not obtained,
the provisions regarding the fee shall become inoperative. The bill
would provide that no hospital shall be required to pay the coverage
dividend fee to the department unless and until the state receives
and maintains federal approval of the fee from the federal Centers
for Medicare and Medicaid Services.
This bill would provide that for calendar quarters prior to
federal approval of the fee and for the calendar quarter when the
department receives notice of federal approval, a hospital shall
certify, under penalty of perjury, and to the best of its knowledge,
on a form provided by the department, that it has set aside in a
separate account an amount equal to the aggregate coverage dividend
fee for that hospital, as specified. The bill would require hospitals
to, within 30 days after federal approval, to pay the principal
amount of the coverage dividend fee set aside in a separate account
to the department.
By expanding the definition of the crime of perjury, this bill
would create a state-mandated local program.
This bill would require the department, within 10 days of
receiving federal approval, to send notice to providers, and publish
on its Internet Web site, certain information regarding the coverage
dividend fee. This bill would require, upon federal approval, that
within 45 days following the beginning of each calendar quarter,
commencing with the quarter in which the department receives federal
approval and ending with, and including, the calendar quarter ending
December 31, 2010, each hospital pay the department the coverage
dividend fee, as specified. This bill would authorize the department,
if a hospital fails to pay all or part of the coverage dividend fee
within 60 days of the date that payment is due, to deduct the unpaid
assessment and interest owed from any Medi-Cal payments to the
hospital until the full amount is recovered.
This bill would create the Coverage Dividend Revenue Fund in the
State Treasury and require the money collected from the coverage
dividend fee to be deposited into the fund. The money in the fund
would be continuously appropriated without regard to fiscal year for
the purpose of making the above-described supplemental reimbursement
or expanding health care coverage for children, with the supplemental
reimbursement taking priority over the expansion of health care
coverage for children.
The California Constitution requires the state to reimburse local
agencies and school districts for certain costs mandated by the
state. Statutory provisions establish procedures for making that
reimbursement.
This bill would provide that no reimbursement is required by this
act for a specified reason.
This bill would declare that it is to take effect immediately as
an urgency statute.
Existing law provides for the Medi-Cal program, administered by
the State Department of Health Care Services, under which health care
services are provided to qualified low-income persons. Existing law
prescribes procedures for Medi-Cal reimbursement at these facilities.
Existing law requires that, as a condition of Medi-Cal program
participation, and subject to federal approval, there be imposed a
quality assurance fee on skilled nursing facilities, with the moneys
collected from these fees to be used for specified purposes under the
Medi-Cal program to support quality improvement of long-term care,
as prescribed.
This bill would declare the intent of the Legislature to enact
legislation that would impose a fee on hospitals in order to increase
federal financial participation in order to increase Medi-Cal
payments to hospitals.
This bill would also require the department to maximize federal
funding in Med-Cal payments to hospitals.
This bill would declare that it is to take effect immediately as
an urgency statute.
Vote: 2/3. Appropriation: no yes .
Fiscal committee: yes. State-mandated local program: no
yes .
THE PEOPLE OF THE STATE OF CALIFORNIA DO ENACT AS FOLLOWS:
SECTION 1. It is the intent of the Legislature
to enact legislation that would impose a fee to be paid by hospitals
that shall be used to increase federal financial participation in
order to increase Medi-Cal payments to hospitals.
SEC. 2. The State Department of Health Care
Services shall seek to maximize federal funding in Medi-Cal,
including funding for hospital reimbursement.
SECTION 1. Article 5.21 (commencing with Section
14167.1) is added to Chapter 7 of Part 3 of Division 9 of the
Welfare and Institutions Code , to read:
Article 5.21. Medi-Cal Hospital Provider Rate Stabilization
Act
14167.1. (a) "Designated public hospital" means any one of the
following hospitals:
(1) UC Davis Medical Center.
(2) UC Irvine Medical Center.
(3) UC San Diego Medical Center.
(4) UC San Francisco Medical Center.
(5) UC Los Angeles Medical Center, including Santa Monica/UCLA
Medical Center.
(6) LA County Harbor/UCLA Medical Center.
(7) LA County Olive View UCLA Medical Center.
(8) LA County Rancho Los Amigos National Rehabilitation Center.
(9) LA County University of Southern California Medical Center.
(10) Alameda County Medical Center.
(11) Arrowhead Regional Medical Center.
(12) Contra Costa Regional Medical Center.
(13) Kern Medical Center.
(14) Natividad Medical Center.
(15) Riverside County Regional Medical Center.
(16) San Francisco General Hospital.
(17) San Joaquin General Hospital.
(18) San Mateo Medical Center.
(19) Santa Clara Valley Medical Center.
(20) Ventura County Medical Center.
(b) "Federal upper payment limit" means the upper payment limit on
the applicable category of hospitals pursuant to federal law that
will be allowed for purposes of federal financial participation. The
federal upper payment limit for hospital outpatient services is as
set forth in Section 447.321 of Title 42 of the Code of Federal
Regulations. The federal upper payment limit for hospital inpatient
services is as set forth in Section 447.272 of Title 42 of the Code
of Federal Regulations.
(c) "Hospital inpatient services" means all services covered under
the Medi-Cal program and furnished by hospitals to patients who are
admitted as hospital inpatients and reimbursed on a fee-for-service
basis by the department directly or through its fiscal intermediary.
Hospital inpatient services include outpatient services furnished by
a hospital to a patient who is admitted to that hospital within 24
hours of the provision of the outpatient services that are related to
the condition for which the patient is admitted. Hospital inpatient
services include physician services only if the service is furnished
to a hospital inpatient, the physician is compensated by the hospital
for the service, and the service is billed to the Medi-Cal program
by the hospital under a provider number assigned to the hospital.
Hospital inpatient services do not include services for which a
managed care health plan is financially responsible.
(d) "Hospital outpatient services" means all services covered
under the Medi-Cal program furnished by hospitals to patients who are
registered as hospital outpatients and reimbursed by the department
on a fee-for-service basis directly or through its fiscal
intermediary. Hospital outpatient services include physician services
only if the service is furnished to a hospital outpatient, the
physician is compensated by the hospital for the service, and the
service is billed to the Medi-Cal program by the hospital under a
provider number assigned to the hospital. Hospital outpatient
services do not include services for which a managed health care plan
is financially responsible or services rendered by a hospital-based
federally qualified health center that receives reimbursement
pursuant to Section 14132.100.
(e) "Implementation date" means the later of the date this article
becomes effective or the date all federal approvals or waivers
necessary for the implementation of this article become effective.
(f) "Managed care inpatient day" means an acute inpatient day of
service covered under the Medi-Cal program for which a managed care
health plan is financially responsible and that is covered by a
written contract between a managed care health plan and a hospital or
a hospital system.
(g) "Managed health care plan" means a health care delivery system
that manages the provision of health care and receives prepaid
capitated payments from the state in return for providing services to
Medi-Cal beneficiaries. Managed health care plans include, but are
not limited to, county organized health systems, prepaid health plans
and entities contracting with the department to provide services
pursuant to two-plan models, and geographic managed care. Entities
providing these services contract with the department pursuant to
Article 2.7 (commencing with Section 14087.3), Article 2.8
(commencing with Section 14087.5), or Article 2.91 (commencing with
Section 14089) of Chapter 7, or Article 1 (commencing with Section
14200) or Article 7 (commencing with Section 14490) of Chapter 8.
(h) "Nondesignated public hospital" means a public hospital that
is licensed pursuant to subdivision (a) of Section 1250 of the Health
and Safety Code, is not designated as a specialty hospital in the
hospital's annual financial disclosure report for the hospital's
latest fiscal year ending in 2008, and is defined in paragraph (25)
of subdivision (a) of Section 14105.98, excluding designated public
hospitals.
(i) "Outpatient base rates" means the Medi-Cal payment rates for
hospital outpatient services in effect on the date immediately
preceding the implementation date.
(j) "Private hospital" means a hospital licensed pursuant to
subdivision (a) of Section 1250 of the Health and Safety Code, is not
designated as a specialty hospital in the hospital's annual
financial disclosure report for the hospital's latest fiscal year
ending in 2008, and is a nonpublic hospital, nonpublic-converted
hospital, or converted hospital as those terms are defined in
paragraphs (26) to (28), inclusive, respectively, of subdivision (a)
of Section 14105.98.
(k) "Subject federal fiscal year" means a federal fiscal year that
ends after the implementation date and begins before the termination
date.
(l) "Termination date" means December 31, 2010.
14167.2. (a) Private hospitals shall be paid supplemental amounts
for hospital outpatient services that shall be in addition to any
other amounts payable to hospitals with respect to hospital
outpatient services and shall not affect any other payments to
hospitals.
(b) Medi-Cal rates for hospital outpatient services shall result
in aggregate payments equal to the federal upper payment limit.
14167.3. (a) Hospitals shall be paid supplemental amounts for
hospital inpatient services that shall be in addition to any other
amounts payable to hospitals with respect to hospital inpatient
services and shall not affect any other payments to hospitals.
(b) Medi-Cal rates for hospital inpatient services shall result in
aggregate payments equal to the federal upper payment limit.
14167.4. Private hospitals, nondesignated public hospitals, and
designated public hospitals shall be paid supplemental amounts for
hospital services furnished to managed care enrollees pursuant to
this section. The supplemental amounts shall be paid directly to the
hospitals by the department or its fiscal intermediary in addition to
any other amounts payable to hospitals with respect to hospital
services furnished to managed care enrollees and shall not affect any
other payments to hospitals.
14167.5. The amount of any payments made pursuant to this article
to private hospitals, including the amount of payments made pursuant
to Sections 14167.2, 14167.3, and 14167.4, shall not be included in
the calculation of the numerator or denominator of the low-income
percent of the OBRA limit for purposes of disproportionate share
hospital replacement fund payments to private hospitals made pursuant
to Section 14166.11.
14167.6. (a) The payments made pursuant to Sections 14167.2,
14167.3, and 14167.4 to hospitals for the 2008-09 federal fiscal year
shall be made on or before the later of August 31, 2009, or the 30th
day following the day on which federal approval is granted.
(b) The payments made pursuant to Sections 14167.2, 14167.3, and
14167.4 to hospitals for 2009-10 federal fiscal year shall be made on
a quarterly basis. The amounts payable to a hospital for each
quarter shall be one-fourth of the amount payable to the hospital for
the entire federal fiscal year. Payments to hospitals for each
quarter during the 2009-10 federal fiscal year shall be made on the
later of the last day of the second month of the quarter or the 30th
day following the day on which federal approval is granted.
(c) The payments made pursuant to Sections 14167.2, 14167.3, and
14167.4 to hospitals for the 2010-11 federal fiscal year shall be
made on or before the later of November 30, 2010, or the 30th day
following the day on which federal approval is granted.
14167.7. (a) Payment rates for hospital outpatient services
furnished by private hospitals and nondesignated public hospitals
before October 1, 2011, exclusive of amounts payable under this
article, shall not be reduced below the rates in effect on June 30,
2008.
(b) Rates payable to hospitals for hospital inpatient services
furnished before October 1, 2011, under contracts negotiated pursuant
to the Selective Provider Contracting Program shall not be reduced
below the contract rates in effect on June 1, 2009. This subdivision
shall not prohibit changes to the supplemental payments paid to
individual hospitals pursuant to Sections 14166.12, 14166.17, and
14166.23. The aggregate supplemental payments made pursuant to
Sections 14166.12, 14166.17, and 14166.23 for a state fiscal year
that ends after the implementation date and begins before the
termination date shall not be less than the aggregate payments made
pursuant to Sections 14166.12, 14166.17, and 14166.23 during the
2007-08 state fiscal year.
(c) Payments to private hospitals and nondesignated public
hospitals for hospital inpatient services furnished before October 1,
2011, that are not reimbursed pursuant to a contract negotiated
pursuant to the Selective Provider Contracting Program, exclusive of
amounts payable under this article, shall not be less than the amount
of payments that would have been made pursuant to the payment
methodology in effect on June 30, 2008.
(d) Payments to hospitals pursuant to Sections 14166.11 and
14166.16 for a state fiscal year that ends after the implementation
date and begins before the termination date shall not be less than
the payments due under the methodology set forth in those sections in
effect for the 2007-08 state fiscal year.
(e) Managed care health plans shall not take into account payments
made pursuant to this article in negotiating the amount of payments
to hospitals that are not made pursuant to this article.
14167.8. (a) The director shall promptly seek the federal
approvals or waivers as may be necessary to implement this article
and obtain federal financial participation to the maximum extent
possible for the payments made pursuant to this article.
(b) In implementing this article, the department may utilize the
services of the Medi-Cal fiscal intermediary through a change order
to the fiscal intermediary contract to administer this program,
consistent with the requirements of Sections 14104.6, 14104.7,
14104.8, and 14104.9. Contracts entered into with any Medicare fiscal
intermediary shall not be subject to Part 2 (commencing with Section
10100) of Division 2 of the Public Contract Code.
(c)Notwithstanding Section 14167.9, this article shall become
inoperative in the event, and on the effective date, of a final
judicial determination by any court of appellate jurisdiction or a
final determination by the federal Department of Health and Human
Services or the federal Centers for Medicare and Medicaid Services
that any element of this article cannot be implemented.
(d) In the event any hospital, or any party on behalf of a
hospital, shall initiate a case or proceeding in any state or federal
court in which the hospital seeks any relief of any sort whatsoever,
including, but not limited to, monetary relief, injunctive relief,
declaratory relief, or a writ, based in whole or in part on a
contention that any or all of this article is unlawful and may not be
lawfully implemented, all of the following shall apply:
(1) No payments shall be made to a hospital pursuant to this
article until the case or proceeding is finally resolved, including
the final disposition of all appeals.
(2) Any amount computed to be payable to a hospital pursuant to
this article for a subject federal fiscal year shall be withheld by
the department and shall be paid to the hospital only after the case
or proceeding is finally resolved, including the final disposition of
all appeals.
14167.9. This article shall remain in effect only until January
1, 2011,, and as of that date is repealed, unless a later enacted
statute, that is enacted before January 1, 2011, deletes or extends
that date.
SEC. 2. Article 5.22 (commencing with Section
14167.31) is added to Chapter 7 of Part 3 of Division 9 of the
Welfare and Institutions Code , to read:
Article 5.22. Hospital Coverage Dividend Fee Act
14167.31. For purposes of this article, "subject federal fiscal
year" means a federal fiscal year ending after the effective date of
federal approval of Article 5.21 (commencing with Section 14167.1)
and beginning before December 31, 2010.
14167.32. (a) There shall be imposed a coverage dividend fee that
is consistent with the principle of shared benefit and shared
responsibility.
(b) The coverage dividend fee shall be assessed on hospitals,
except for designated public hospitals, as defined in subdivision (a)
of Section 14167.1, starting on the day that this article becomes
effective and shall continue through and including December 31, 2010.
(c) The department shall calculate the amount of the aggregate
coverage dividend fee for each hospital within 10 days after the date
when this article becomes effective. Within two days of calculating
the aggregate coverage dividend fee, the department shall send notice
of the amount of the aggregate coverage dividend fee to each
hospital.
(d) For calendar quarters prior to federal approval of the
implementation of this article and for the calendar quarter when the
department receives notice of federal approval of the implementation
of this article, the following provisions shall apply:
(1) For the calendar quarters, and partial quarters thereof,
between the day that this article becomes effective and September 30,
2009, inclusive, the following provisions shall apply:
(A) If this article becomes effective on or before June 30, 2009,
the following provisions shall apply:
(i) On the later of 10 days after this article becomes effective
or May 15, 2009, each hospital shall certify, under penalty of
perjury, and to the best of its knowledge, on a form provided by the
department, that it has set aside in a separate account an amount
equal to the aggregate coverage dividend fee for that hospital
divided by the number of days from the date that this article becomes
effective to September 30, 2009, inclusive, multiplied by the number
of days from the date that this article becomes effective to June
30, 2009, inclusive.
(ii) On or before August 15, 2009, each hospital shall certify,
under penalty of perjury, and to the best of its knowledge, on a form
provided by the department, that it has set aside in a separate
account an amount equal to the aggregate coverage dividend fee for
that hospital divided by the number of days from the date that this
article becomes effective to September 30, 2009, inclusive,
multiplied by the number of days from July 1, 2009, to September 30,
2009, inclusive.
(B) If this article is enacted on or after July 1, 2009, on the
later of 10 days after this article becomes effective or August 15,
2009, each hospital shall certify, under penalty of perjury, and to
the best of its knowledge, on a form provided by the department, that
it has set aside in a separate account an amount equal to the
aggregate coverage dividend fee for that hospital.
(2) For each calendar quarter beginning on or after October 1,
2009, and ending on or before September 30, 2010, within 45 days
following the beginning of each calendar quarter, each hospital shall
certify, under penalty of perjury, and to the best of its knowledge,
on a form provided by the department, that it has set aside in a
separate account an amount equal to the aggregate coverage dividend
fee for that hospital divided by four.
(3) For the calendar quarter beginning October 1, 2010, on or
before November 15, 2010, each hospital shall certify, under penalty
of perjury, and to the best of its knowledge, on a form provided by
the department, that it has set aside in a separate account an amount
equal to the aggregate coverage dividend fee for that hospital.
(4) All certifications required by this subdivision shall include
a certification from each hospital that it has maintained any
coverage dividend fee amounts previously set aside in a separate
account in that separate account, and that within 30 days after
federal approval of the implementation of this article, the hospital
shall pay the principal amount of the coverage dividend fee set aside
in a separate account to the department pursuant to paragraph (2) of
subdivision (e).
(e) Upon federal approval of the implementation of this article,
all of the following shall become operative:
(1) Within 10 days following the notice of approval by the federal
government of the implementation of this article, the department
shall send notice to providers, and publish on its Internet Web site
the following information:
(A) The date that the state received notice of federal approval of
the implementation of this article.
(B) The percentage of the fee that shall be collected to meet the
federal upper payment limit, as defined in subdivision (b) of Section
14167.1.
(C) A notice to each hospital subject to the coverage dividend fee
stating all of the following:
(i) That the hospital shall, within 30 days after the date the
department received notice of federal approval of the implementation
of this article, pay the principal amounts of the coverage dividend
fee set aside in a separate account to the department multiplied by
the percentage of the fee that will be collected to meet the federal
upper payment limit as described in subparagraph (B).
(ii) The total amount of the fee that will be payable by the
hospital on the date described in clause (i).
(2) Within 30 days after the date the department receives notice
of federal approval, each hospital shall pay the principal amount of
the coverage dividend fee the hospital has certified pursuant to
subdivision (d) that the hospital has set aside in a separate account
to the department multiplied by the percentage of the fee that shall
be collected to meet the federal upper payment limit as described in
subparagraph (B) of paragraph (1). Any money set aside in a separate
account in excess of the amount the hospital is obligated to pay to
the department may be returned to the general accounts of each
hospital.
(3) Subdivision (d) shall become inoperative beginning the first
day of the first calendar quarter following the quarter in which the
department receives notice of approval by the federal government of
the implementation of this article.
(4) Within 45 days following the beginning of each calendar
quarter, commencing with the quarter in which the department receives
notice of federal approval and ending with, and including, the
calendar quarter ending December 31, 2010, each hospital shall pay to
the department the amounts that the hospital would have certified to
pay for the relevant quarter pursuant to subdivision (d) multiplied
by the percentage of the fee that will be collected to meet the
federal upper payment limit described in subparagraph (B) of
paragraph (1).
(5) The coverage dividend fee, as paid pursuant to this
subdivision, shall be paid by each hospital subject to the fee and
paid to the department for deposit in the Coverage Dividend Revenue
Fund created pursuant to Section 14167.35. Deposits into the fund may
be accepted at any time and shall be credited toward the fiscal year
for which they were assessed.
(f) (1) Subdivision (h) shall become inoperative if either of the
following situations occur:
(A) The federal Centers for Medicare and Medicaid Services denies
approval for the implementation of Article 5.21 (commencing with
Section 14167.1) or this article and the methodology specified in
Article 5.21 (commencing with Section 14167.1) or this article may
not be modified by consulting with the hospital community to obtain
federal approval without violating the intent of Article 5.21
(commencing with Section 14167.1) or this article or modified in a
way that is consistent with the conditions of implementation set
forth in subdivisions (a) and (c) of Section 14167.36.
(B) The federal Centers for Medicare and Medicaid Services does
not approve the implementation of Article 5.21 (commencing with
Section 14167.1) or this article on or before January 1, 2012.
(2) If subdivision (h) becomes inoperative pursuant to this
subdivision, each hospital subject to the coverage dividend fee shall
be released from any certifications made pursuant to subdivision (d)
and any amounts previously set aside in a separate account and any
interest incurred on those amounts may be returned to the general
accounts of each hospital.
(g) In no case shall the aggregate fees collected on an annual
fiscal year basis pursuant to this section exceed the maximum
percentage of the annual aggregate net patient revenue for hospitals
subject to the fee that is prescribed pursuant to federal law and
regulations as necessary to preclude a finding that an indirect
guarantee has been created.
(h) Interest shall be assessed on coverage dividend fees not paid
on the date due at the same rate at which the department assesses
interest on Medi-Cal program overpayments to hospitals that are not
repaid when due. Interest shall begin to accrue the day after the
date the payment was due and shall be deposited in the Coverage
Dividend Revenue Fund.
(i) When a hospital fails to pay all or part of the coverage
dividend fee within 60 days of the date that payment is due, the
department may deduct the unpaid assessment and interest owed from
any Medi-Cal payments to the hospital until the full amount is
recovered. Any deduction shall be made only after written notice to
the hospital and may be taken over a period of time. All amounts
deducted by the department pursuant to this subdivision shall be
deposited in the Coverage Dividend Revenue Fund.
(j) In
accordance with the provisions of the Medicaid state plan, the
payment of the coverage dividend fee shall be considered as an
allowable cost for Medi-Cal cost reporting and reimbursement
purposes.
(k) The department shall work in consultation with the hospital
community to implement the coverage dividend fee.
(l) The department shall offer to enter into a contract with each
hospital subject to the coverage dividend fee, or to amend existing
contracts with the hospital, that obligates the department to use the
proceeds of the coverage dividend fee solely for the purposes set
forth in this article and to comply with all of its obligations set
forth in Article 5.21 (commencing with Section 14167.1) and this
article, including, but not limited to, its obligation to continue
prior reimbursement levels. Each contract shall also provide that the
hospital's obligation to pay the coverage dividend fee shall be
contingent on the department performing its obligations under the
contract. Each contract shall be binding on the department and
enforceable by the hospitals regardless of whether the hospitals have
given adequate consideration in return for the department's
obligations.
14167.35. (a) The Coverage Dividend Revenue Fund is hereby
created in the State Treasury. Interest earned on deposits in the
fund shall be retained in the fund for purposes specified in
subdivision (c).
(b) All fees and interest required to be paid to the state
pursuant to this article shall be paid in the form of remittances
payable to the department. The department shall directly transmit the
payments to the Treasurer to be deposited in the Coverage Dividend
Revenue Fund.
(c) All funds in the Coverage Dividend Revenue Fund, together with
any interest, and penalties, shall be used only for the following
purposes in the following order of priority, subject to the
requirements of subdivision (d):
(1) To make increased payments to hospitals pursuant to Article
5.21 (commencing with Section 14167.1).
(2) To pay for the expansion of health care coverage for children
beyond existing levels.
(d) No portion of the Coverage Dividend Revenue Fund shall be used
in support of the administration of the department except that these
fees may be used in combination with federal funds to fund the
actual cost of collecting the fee.
(e) Notwithstanding Section 13340 of the Government Code, the
Coverage Dividend Revenue Fund shall be continuously appropriated for
the purposes described in subdivision (c) without regard to fiscal
year.
(f) The department shall request approval from the federal Centers
for Medicare and Medicaid Services for the implementation of this
article. In making this request, the department shall seek specific
approval from the federal Centers for Medicare and Medicaid Services
to exempt providers identified in this article as exempt from the
fees specified, including the submission, as may be necessary, of a
request for waiver of the broad based requirement, waiver of the
uniform tax requirement, or both, pursuant to Section 433.68(e)(1)
and (e)(2) of Title 42 of the Code of Federal Regulations.
(g) Any methodology specified in Article 5.21 (commencing with
Section 14167.1) and this article may be modified by the department,
in consultation with the hospital community, to the extent necessary
to meet the requirements of federal law or regulations or to obtain
federal approval, provided the modifications do not violate the
intent of Article 5.21 (commencing with Section 14167.1) or this
article and are not inconsistent with the conditions of
implementation set forth in subdivisions (a) and (c) of Section
14167.36.
(h) The department, in consultation with the hospital community,
shall make retrospective adjustments, as necessary, to the amounts
calculated pursuant to Section 14167.32 in order to ensure compliance
with the federal limits set forth in Section 433.68 of Title 42 of
the Code of Federal Regulations or elsewhere in federal law.
14167.36. (a) This article shall only be implemented so long as
the following conditions are met:
(1) The coverage dividend fee is established in a manner
consistent with this article.
(2) The coverage dividend fee is deposited, including any interest
on the fee after collection by the department, in a segregated fund
apart from the General Fund.
(3) The proceeds of the coverage dividend fee, including any
interest, penalties, and related federal reimbursement, are only used
for the purposes set forth in this article.
(b) No hospital shall be required to pay the coverage dividend fee
to the department unless and until the state receives and maintains
federal approval of the coverage dividend fee and Article 5.21
(commencing with Section 14167.1) from the federal Centers for
Medicare and Medicaid Services.
(c) Hospitals shall be required to pay the coverage dividend fee
to the department as set forth in this article only as long as all of
the following conditions are met:
(1) The federal Centers for Medicare and Medicaid Services allows
the use of the coverage dividend fee as set forth in this article.
(2) The Medi-Cal Provider Rate Stabilization Act (Article 5.21
(commencing with Section 14167.1)) is enacted and remains in effect
and hospitals are reimbursed the increased rates beginning on the
implementation date, as defined in subdivision (e) of Section
14167.1.
(3) The full amount of the coverage dividend fee assessed and
collected pursuant to this article remains available only for the
purposes specified in this article.
(d) Notwithstanding subdivisions (a), (b), and (c) of this section
and Section 14167.38, in the event of a final judicial determination
made by any state or federal court that is not appealed, or by a
court of appellate jurisdiction that is not further appealed, in any
action by any party, or a final determination by the administrator of
the federal Centers for Medicare and Medicaid Services, that the
coverage dividend fee assessed and collected pursuant to this article
cannot be implemented, this article shall become inoperative.
14167.37. (a) The director shall seek federal approval of each
element of this article. If after seeking federal approval, federal
approval is not obtained, this article shall become inoperative.
(b) Each and every report or informational submission required
from providers pursuant to this article shall contain a legal
verification to be signed by the provider verifying under penalty of
perjury that the information provided is true and correct, and that
any information in supporting documents submitted by the provider is
true and correct.
14167.38. This article shall remain in effect only until January
1, 2011, and as of that date is repealed, unless a later enacted
statute, that is enacted before January 1, 2011, deletes or extends
that date.
SEC. 3. No reimbursement is required by this act
pursuant to Section 6 of Article XIII B of the California
Constitution because the only costs that may be incurred by a local
agency or school district will be incurred because this act creates a
new crime or infraction, eliminates a crime or infraction, or
changes the penalty for a crime or infraction, within the meaning of
Section 17556 of the Government Code, or changes the definition of a
crime within the meaning of Section 6 of Article XIII B of the
California Constitution.
SEC. 3. SEC. 4. This act is an
urgency statute necessary for the immediate preservation of the
public peace, health, or safety within the meaning of Article IV of
the Constitution and shall go into immediate effect. The facts
constituting the necessity are:
In order to make the necessary statutory changes to increase
Medi-Cal payments to hospitals and improve access'
access, at the earliest possible time, so as to allow
this act to be operative as soon as approval from the United
States Center federal Centers for Medicare and
Medicaid Services is obtained by the State Department of Health Care
Services, it is necessary that this act take effect immediately.