HLS 13RS-881 ORIGINAL
Page 1 of 5
CODING: Words in struck through type are deletions from existing law; words underscored
are additions.
Regular Session, 2013
HOUSE BILL NO. 532
BY REPRESENTATIVES KLECKLEY AND LEGER
Prefiled pursuant to Article III, Section 2(A)(4)(b)(i) of the Constitution of Louisiana.
FUNDS/FUNDING: (Constitutional Amendment) Provides for a hospital stabilization
formula and assessment and creates the Hospital Stabilization Fund and provides for
uses of the fund
A JOINT RESOLUTION1
Proposing to add Article VII, Section 10.13 of the Constitution of Louisiana, to provide2
relative to health care funding; to provide for a hospital stabilization formula; to3
provide for a hospital assessment; to create the Hospital Stabilization Fund as a4
treasury fund; to provide for deposit, use, and investment of the fund; to provide for5
submission of the proposed amendment to the electors; and to provide for related6
matters.7
Section 1. Be it resolved by the Legislature of Louisiana, two-thirds of the members8
elected to each house concurring, that there shall be submitted to the electors of the state of9
Louisiana, for their approval or rejection in the manner provided by law, a proposal to10
amend Article VII, Section 10.13 of the Constitution of Louisiana, to read as follows:11
ยง10.13. Hospital stabilization formula and assessment; Hospital Stabilization Fund12
(A) Hospital Stabilization Formula. (1) The legislature may annually adopt13
a Hospital Stabilization Formula, hereafter referred to in this Section as "the14
formula", by concurrent resolution by a favorable vote of two-thirds of the elected15
members of each house. The formula shall, to the maximum extent possible enhance16
the economic viability of Louisiana hospitals and reduce shifting the cost of caring17
for Louisiana's needy residents to the state's insured residents.18 HLS 13RS-881 ORIGINAL
HB NO. 532
Page 2 of 5
CODING: Words in struck through type are deletions from existing law; words underscored
are additions.
(2) (a) The first formula established pursuant to Subparagraph (1) of this1
Paragraph shall define and establish as the base rate the payment levels under the2
Louisiana medical assistance program provided for in Title XIX of the Social3
Security Act, hereafter referred to as the "Medicaid Program", to hospitals, including4
rural hospitals, for inpatient and outpatient services in Fiscal Year 2012-2013. Each5
formula established thereafter shall apply a rate of inflation, which shall not be a6
negative rate, to the base rate from the previous formula adopted by the legislature.7
(b) Each formula shall also include and establish assessments to be paid by8
hospitals, and the basis on which such assessments shall be calculated, provided the9
amount of the assessments does not exceed the non-federal share of the rate10
enhancements.11
(c) Each formula shall also establish reimbursement rate enhancements under12
the Medicaid Program, or its successor, with the goal of achieving the maximum13
rates allowed for such payment by federal law and distributing such rate14
enhancements among hospitals subject to the assessment in proportion to the15
Medicaid Program services delivered. Rate enhancements may also be distributed16
for uninsured services delivered.17
(d) Each formula shall also include any additional provisions necessary to the18
implementation of the formula.19
(3) The base rate resulting from the formula shall not be paid from the20
Hospital Stabilization Fund.21
(4) The treasurer shall return any assessment to the hospital from which it22
was collected, and no further assessment shall be collected from any hospital, in a23
fiscal year in which any of the following occur:24
(a) The legislature fails to adopt a formula.25
(b) The Department of Health and Hospitals, or its successor or contractors,26
reduces or does not pay rate enhancements established in the current formula as27
adopted by the legislature.28 HLS 13RS-881 ORIGINAL
HB NO. 532
Page 3 of 5
CODING: Words in struck through type are deletions from existing law; words underscored
are additions.
(c) The appropriations provided for in Subparagraph (B)(2) of this Section1
are reduced.2
(B) Appropriation. (1) The legislature shall annually appropriate an amount3
necessary to fund the base rate for hospitals established in the most recent formula4
adopted by the legislature.5
(2) The legislature shall annually appropriate the anticipated balance of the6
Hospital Stabilization Fund solely to fund the rate enhancements to hospitals as7
provided in the most recent formula adopted by the legislature.8
(3) Notwithstanding Article VII, Section 10(F) of this constitution, neither9
the governor nor the legislature may reduce the appropriation funding the base rate10
or the rate enhancements to satisfy a budget deficit, except the governor may reduce11
the appropriation to the base rate if the following occur:12
(a) Such reduction is consented to in writing by two-thirds of the elected13
members of each house in a manner provided by law; and14
(b) Such reduction does not exceed the average reduction of those made to15
the appropriations for other providers under the Medicaid Program, or its successor.16
(C) Hospital Stabilization Fund. There is hereby established as a special fund17
in the state treasury the Hospital Stabilization Fund, hereafter referred to as "the18
fund". After compliance with the requirements of Article VII, Section 9(B) of this19
constitution relative to the Bond Security and Redemption Fund, the treasurer shall20
deposit all proceeds from the assessment collected in the amounts established in the21
Hospital Stabilization Formula provided for in this Section. The monies in the fund22
shall be invested in the same manner as monies in the state general fund and all23
interest earned on the investment of the fund shall be deposited in and credited to the24
fund. Appropriations from the fund shall be restricted to funding the rate25
enhancements established in the Hospital Stabilization Formula adopted by the26
legislature for the fiscal year in which the assessment is collected. Any amounts27
remaining in the fund at the end of a fiscal year shall be refunded to the participating28
hospitals in proportion to the assessments paid.29 HLS 13RS-881 ORIGINAL
HB NO. 532
Page 4 of 5
CODING: Words in struck through type are deletions from existing law; words underscored
are additions.
Section 2. Be it further resolved that this proposed amendment shall be submitted1
to the electors of the state of Louisiana at the statewide election to be held on November 4,2
2014.3
Section 3. Be it further resolved that on the official ballot to be used at the election,4
there shall be printed a proposition, upon which the electors of the state shall be permitted5
to vote YES or NO, to amend the Constitution of Louisiana, which proposition shall read as6
follows:7
Do you support an amendment to authorize the legislature to establish a8
formula to calculate payments made to hospitals for Medicaid9
reimbursement of health care services; by creating the Hospital Stabilization10
Fund; and by depositing assessments paid by hospitals into the fund to11
support the enhancement of Louisiana hospital reimbursement? (Adds Article12
VII, Section 10.13)13
DIGEST
The digest printed below was prepared by House Legislative Services. It constitutes no part
of the legislative instrument. The keyword, one-liner, abstract, and digest do not constitute
part of the law or proof or indicia of legislative intent. [R.S. 1:13(B) and 24:177(E)]
Kleckley HB No. 532
Abstract: Provides for the legislature to establish a formula for funding hospitals by
establishing rate increases for hospitals; by establishing an assessment on hospitals;
by creating the Hospital Stabilization fund to deposit assessments, and using the
monies in the fund for rate enhancements.
Proposed constitutional amendment provides for an annual Hospital Stabilization formula
by concurrent resolution by a favorable vote of two-thirds of the elected members of each
house. The formula includes:
(1) A base rate that is the payment levels under the Medicaid Program to hospitals
for inpatient and outpatient services in FY 2012-2013 in the first year and each
subsequent formula applies a rate of inflation to the base rate from the previous fiscal
year.
(2) Assessments to be paid by Louisiana hospitals, provided the amount of the
assessment does not exceed the non-federal share of the rate enhancement.
(3) Reimbursement rate enhancements for those hospitals subject to an assessment
provided for in the formula.
(4) Any additional provisions necessary to the implementation of the formula. HLS 13RS-881 ORIGINAL
HB NO. 532
Page 5 of 5
CODING: Words in struck through type are deletions from existing law; words underscored
are additions.
Proposed constitutional amendment provides that the base rate shall not be paid from the
Hospital Stabilization Fund.
Proposed constitutional amendment provides that no assessments shall be collected from any
hospital in a fiscal year in which any of the following occur:
(1) The legislature fails to adopt a formula.
(2) The Department of Health and Hospitals reduces or does not pay rate
enhancements established in the current formula.
(3) The appropriations provided for in proposed constitutional amendment are
reduced.
Proposed constitutional amendment provides for annual appropriation of an amount
necessary to fund the base rate for hospitals and appropriate the balance of the Hospital
Stabilization Fund created in the proposed constitutional amendment for rate enhancements.
Proposed constitutional amendment provides for reductions to the appropriations if the
reduction is consented to in writing by two-thirds of the elected members of each house in
a manner provided by law and does not exceed the average reduction of those made to the
appropriations for other providers under the Medicaid Program.
Proposed constitutional amendment creates the Hospital Stabilization Fund and provides
appropriations only for funding the rate enhancement established in the Hospital
Stabilization Formula for the fiscal year in which the assessment is collected. Any amounts
remaining in the fund at the end of a fiscal year shall be refunded to the participating
hospitals in proportion to the assessments paid.
Provides for submission of the proposed amendment to the voters at the statewide election
to be held November 4, 2014.
(Adds Const. Art. VII, Section 10.13)