LEGISLATIVE SERVICES AGENCY
OFFICE OF FISCAL AND MANAGEMENT ANALYSIS
FISCAL IMPACT STATEMENT
LS 6492 NOTE PREPARED:
BILL NUMBER: SB 487 BILL AMENDED:
SUBJECT: Hospital Assessment Fee.
FIRST AUTHOR: Sen. Charbonneau BILL STATUS: As Introduced
FIRST SPONSOR:
FUNDS AFFECTED:XGENERAL IMPACT: State & Local
XDEDICATED
XFEDERAL
Summary of Legislation: The bill extends the expiration of the Hospital Assessment Fee (HAF) until June
30, 2027.
Effective Date: Upon passage.
Explanation of State Expenditures:
Explanation of State Revenues: Hospital Assessment Fee (HAF): The bill extends the sunset date for the
HAF and the Incremental HAF by two years to FY 2027. These fees generated approximately $1.6 B in FY
2024, and leveraged an estimated $5.7 B in federal funds dedicated to Medicaid expenditures.
HAF Incremental HAF* Total
Provider Fee $1.1 B $0.5 B $1.6 B
FY 2024 State Revenue (from
fees and federal match)
$2.6 B $4.6 B $7.2 B
Federal Funds Leveraged $1.5 B $4.2 B $5.7 B
*90% Federal Match Rate
Of the total HAF revenue, 71.5% is used to increase Medicaid hospital reimbursement up to specified limits.
The remaining 28.5% of the HAF revenue is distributed to the state General Fund to offset other Medicaid
costs incurred by the state. Unused funds in this allocation are distributed to the Hospital Medicaid Fee Fund.
Revenue from the Incremental HAF is deposited in the Incremental Hospital Fee Fund and is used, along
with other state funds, to fund the state share of the Medicaid expansion population receiving services within
the Healthy Indiana Plan.
Explanation of Local Expenditures: Hospital Assessment Fee (HAF): Local government-owned hospitals
SB 487 1 would continue to be assessed the HAF.
Explanation of Local Revenues: Hospital Assessment Fee (HAF): Local government-owned hospitals
would continue to receive enhanced reimbursement up to their hospital specific limit.
State Agencies Affected: Office of Medicaid Policy and Planning, Family and Social Services
Administration.
Local Agencies Affected: Locally owned hospitals.
Information Sources: PeopleSoft Financials FY 2021-FY 2024;
Legislative Services Agency, Indiana Handbook of Taxes, Revenues, and Appropriations, FY 2024.
Fiscal Analyst: Karen Rossen, 317-234-2106.
SB 487 2