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 2/3 of the elected members of each house in the first
resolution. The resolution requires a favorable vote of a majority of the elected members of each
house in subsequent years. Further, the resolution shall be referred to the standing committees
of the legislature that receive the general appropriation bill. The formula provided for in the
resolution 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 La. hospitals, provided the amount of the assessment does not
exceed the nonfederal 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.
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 2/3 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 Nov. 4, 2014.
(Adds Const. Art. VII, ยง10.13)
Summary of Amendments Adopted by House
Committee Amendments Proposed by House Committee on Appropriations to the original
bill.
1. Changed the vote necessary for approval of the resolution establishing the formula
from two-thirds of elected members to a majority, except the resolution for the first
formula which shall require a favorable vote of 2/3 of the elected members of each
house.
2. Required the resolution providing for the formula be referred to the standing
committees of the legislature that receive the general appropriation bill.
3. Added that the formula provide for the preservation and protection of rural hospitals
as provided for by law.
4. Clarified that rate enhancements established in the formula will be distributed among
hospitals for hospital services and deletes the provision that the rate enhancements
will be distributed in proportion to the Medicaid services delivered.