HLS 21RS-897 ENGROSSED
2021 Regular Session
HOUSE BILL NO. 453
BY REPRESENTATIVE DESHOTEL
Prefiled pursuant to Article III, Section 2(A)(4)(b)(i) of the Constitution of Louisiana.
MEDICAID: Provides relative to a program of hospital assessments and intergovernmental
transfers for health services financing
1 AN ACT
2To amend and reenact R.S. 40:1248.1(6), 1248.3(3), 1248.4(D), 1248.5(A), 1248.7(C)(1),
3 1248.8(C) and (D), and 1248.11(A) and to enact R.S. 40:1248.1(7) and 1248.3(4)
4 through (6), relative to financing of health services delivered through the medical
5 assistance program of this state known as Medicaid; to provide relative to a program
6 of local hospital assessments and intergovernmental transfers within Medicaid; to
7 provide for definitions applicable to the program; to authorize participation in the
8 program by hospitals in certain geographic areas; to revise provisions relative to
9 special accounts of local governments associated with the program known as local
10 provider participation funds; to revise provisions relative to rural institutional
11 providers; to authorize governing bodies of parishes participating in the program to
12 form hospital assessment districts; and to provide for related matters.
13Be it enacted by the Legislature of Louisiana:
14 Section 1. R.S. 40:1248.1(6), 1248.3(3), 1248.4(D), 1248.5(A), 1248.7(C)(1),
151248.8(C) and (D), and 1248.11(A) are hereby amended and reenacted and R.S.
1640:1248.1(7) and 1248.3(4) through (6) are hereby enacted to read as follows:
17 §1248.1. Definitions
18 As used in this Subpart, the following terms have the meaning ascribed to
19 them in this Section:
20 * * *
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1 (6) "Rural institutional provider" means a an acute care hospital, other than
2 one defined in R.S. 40:1189.3, that is licensed by the department, has no more than
3 sixty hospital beds on November 1, 2020, and meets any of the following criteria:
4 (a) Is located in a municipality with a population of not less than seven
5 thousand persons and not more than seven thousand five hundred persons according
6 to the most recent federal decennial census and in a parish with a population of not
7 less than thirty thousand thirty-three thousand five hundred persons and not more
8 than thirty-five thousand persons according to the most recent federal decennial
9 census.
10 (b) Is located in a municipality with a population of not less than ten
11 thousand persons and not more than ten thousand five hundred persons according to
12 the most recent federal decennial census and in a parish with a population of not less
13 than eighty thousand persons and not more than ninety thousand persons according
14 to the most recent federal decennial census.
15 (c) Is located in a municipality with a population of not less than three
16 thousand persons and not more than three thousand five hundred persons according
17 to the most recent federal decennial census and in a parish with a population of not
18 less than thirty thousand persons and not more than thirty-five thousand persons a
19 parish with a population of not less than forty-six thousand persons and not more
20 than forty-seven thousand persons according to the most recent federal decennial
21 census.
22 (d) Is located in parish with a population of not less than forty thousand
23 persons and not more than forty-two thousand persons according to the most recent
24 federal decennial census.
25 (7) "Medicaid payment program" means a program of Medicaid payments
26 authorized under the Medicaid state plan which is designated by the governing body
27 of the parish and that benefits rural institutional providers or other hospitals in the
28 parish.
29 * * *
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HB NO. 453
1 §1248.3. Applicability
2 The provisions of this Subpart shall apply exclusively to the following
3 parishes:
4 * * *
5 (3) Any parish in which a rural institutional provider is located with a
6 population of not less than forty-two thousand persons and not more than forty-five
7 thousand persons according to the most recent federal decennial census.
8 (4) Any parish with a population of not less than thirty-three thousand five
9 hundred persons and not more than thirty-five thousand persons according to the
10 most recent federal decennial census.
11 (5) Any parish with a population of not less than eighty thousand persons
12 and not more than ninety thousand persons according to the most recent federal
13 decennial census.
14 (6) Any parish with a population of not less than fifty-two thousand three
15 hundred persons and not more than fifty-two thousand seven hundred persons
16 according to the most recent federal decennial census.
17 §1248.4. Parish healthcare provider participation program
18 * * *
19 D. Any parishes authorized by R.S. 40:1248.3 to establish a local provider
20 participation fund may, upon agreement of the governing authorities of each parish,
21 establish a single fund for the benefit of those parishes and a local hospital
22 assessment applicable to the institutional providers in those parishes. The governing
23 bodies of parishes authorized by R.S. 40:1248.3 to establish a local provider
24 participation fund are authorized and empowered, upon their own initiative, to form
25 and create one or more hospital assessment districts within the respective parishes,
26 or, with agreement among governing bodies of parishes concerned, to combine two
27 or more parishes into a single hospital assessment district with such names as the
28 governing bodies of the parishes may designate. The governing bodies of the
29 parishes are further authorized and empowered, upon their own initiative, to alter the
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HB NO. 453
1 boundaries of any hospital assessment district, provided that no such boundary
2 change shall cause an impairment of the obligations of any contract of the hospital
3 assessment district.
4 §1248.5. Powers and duties of parishes; limitations; inspection of provider records
5 A. The governing body of a parish may require a local hospital assessment
6 payment authorized by this Subpart from an any institutional provider in the parish.
7 The requirement for payment shall be implemented in the manner provided for in
8 this Section.
9 * * *
10 §1248.7. Local provider participation fund; authorized uses
11 * * *
12 C. Monies in the local provider participation fund may be used only for one
13 or more of the following purposes:
14 (1) To fund intergovernmental transfers from a parish to the state to provide
15 the nonfederal share of a Medicaid payment program of Medicaid payments for the
16 benefit of rural institutional providers or other hospitals in the parish authorized
17 under the Medicaid state plan.
18 * * *
19 §1248.8. Local hospital assessment payments; basis; calculation
20 * * *
21 C. A parish that collects a local hospital assessment payment authorized by
22 this Subpart shall set the amount of the local hospital assessment payment. The
23 amount of the local hospital assessment payment required of each paying hospital
24 may not exceed an amount that, when added to the amount of the local hospital
25 assessment payments required from all other paying hospitals in the parish, and the
26 amount of any assessment, local hospital assessment payment, or tax imposed by the
27 state, equals an amount of revenue that exceeds six percent of the aggregate net
28 patient revenue of all paying hospitals in the parish the difference between the
29 maximum allowable amount under 42 CFR 433.68(f).
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1 D. Subject to the maximum payment amount prescribed in Subsection C of
2 this Section, a parish that collects a local hospital assessment payment authorized by
3 this Subpart shall set local hospital assessment payments in amounts that in the
4 aggregate will generate sufficient revenue to cover the administrative expenses of the
5 parish for activities provided for in this Subpart and to fund the nonfederal share of
6 a Medicaid base rate payment program; except that the amount of revenue from local
7 hospital assessment payments used for administrative expenses of the parish for
8 activities provided for in this Subpart in a year may not exceed five percent of the
9 total revenue generated from the local hospital assessment payment or twenty
10 thousand dollars, whichever is greater.
11 * * *
12 §1248.11. Rural institutional providers; enhanced reimbursement
13 A. Upon request from a parish in which a rural institutional provider is
14 located, the department shall attempt in good faith to execute a cooperative endeavor
15 agreement for the use of local provider participation fund proceeds. The parish
16 request shall be in writing and a copy shall be provided to the House and Senate
17 health and welfare committees. If the department fails to execute a cooperative
18 endeavor agreement within ninety days of receipt of the parish request, it shall report
19 to the House and Senate health and welfare committees, within one hundred days of
20 the parish request, the status of the efforts and the reason for the failure to meet the
21 deadline. Notwithstanding any law to the contrary, by September 1, 2020, or as soon
22 thereafter as such a cooperative endeavor agreement is effective or, upon failure to
23 agree on such a cooperative endeavor agreement, within one hundred fifty days of
24 the parish notice unless the department's status report is accepted by an affirmative
25 vote of both the House and Senate health and welfare committees, the department
26 shall file a Medicaid state plan amendment with the Centers for Medicare and
27 Medicaid Services, referred to hereafter in this Section as "CMS", amending the
28 Medicaid state plan provisions governing hospital reimbursement to provide that a
29 rural institutional provider, as defined in R.S. 40:1248.1, shall be reimbursed at a rate
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1 which equals or approximates the lesser of the rural institutional provider's average
2 commercial rate as determined by the state's Medicaid actuary or one hundred ten
3 percent, or, if a reduction is required by CMS, the maximum amount acceptable to
4 CMS, but in no case less than one hundred percent, of the appropriate reasonable
5 cost of providing hospital inpatient and outpatient services, including but not limited
6 to services provided in a rural health clinic licensed as part of a rural hospital. The
7 new rural hospital payment methodology shall utilize prospective rates
8 approximating costs the reimbursement provided in this Section at the time of
9 service for inpatient acute care and psychiatric services. To ensure that rural hospital
10 outpatient services, including those reimbursed on a cost basis and those reimbursed
11 on a fee schedule, are reimbursed in the aggregate at one hundred ten percent of the
12 reasonable costs or such lesser amounts as approved by CMS, but in no case less
13 than one hundred percent of their reasonable costs as provided in this Section, the
14 department shall pay an interim rate for cost-based outpatient services at one
15 hundred ten percent of reasonable cost approximating the reimbursement provided
16 in this Section during the year and for fee-based services paid on a claim-by-claim
17 basis, and the department shall make quarterly estimates of Medicaid base rate
18 payments required to bring reimbursement to the hospital for such services up to one
19 hundred percent of reasonable costs the reimbursement provided in this Section and
20 immediately remit such payments to the hospital, and at final settlement pay such
21 amounts as are necessary to ensure that all outpatient services in the aggregate, both
22 cost-based and fee schedule, are paid at one hundred ten percent of reasonable costs
23 the reimbursement provided in this Section.
24 * * *
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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)]
HB 453 Engrossed 2021 Regular Session Deshotel
Abstract: Expands eligibility for a hospital assessment and intergovernmental transfer
program within Medicaid and revises other provisions pertaining to the program.
Present law provides that, for its purposes, "rural institutional provider" means a hospital,
other than one defined in the Rural Hospital Preservation Act (R.S. 40:1189.3 of present
law), that is licensed by the Louisiana Department of Health (LDH), has no more than 60
beds on Nov. 1, 2020, and meets any of the following criteria:
(1)Is located in a municipality with a population of between 7,000 and 7,500 according
to the most recent federal decennial census and in a parish with a population of
between 30,000 and 35,000 according to that census (Ville Platte in Evangeline
Parish).
(2)Is located in a municipality with a population of between 10,000 and 10,500
according to the most recent federal decennial census and in a parish with a
population of between 80,000 and 90,000 according to that census (Eunice in St.
Landry Parish).
(3)Is located in a municipality with a population of between 3,000 and 3,500 according
to the most recent federal decennial census and in a parish with a population of
between 30,000 and 35,000 according to that census (Mamou in Evangeline Parish
and Welsh in Jefferson Davis Parish).
Proposed law revises present law to provide that, for its purposes, "rural institutional
provider" means an acute care hospital, other than one defined in the Rural Hospital
Preservation Act (R.S. 40:1189.3 of present law), that is licensed by LDH and meets any of
the following criteria:
(1)Is located in a parish with a population of between 33,500 and 35,000 according to
the most recent federal decennial census (Evangeline Parish).
(2)Is located in a parish with a population of between 80,000 and 90,000 according to
the most recent federal decennial census (St. Landry Parish).
(3)Is located in a parish with a population of between 46,000 and 47,000 according to
the most recent federal decennial census (Lincoln Parish).
(4)Is located in a parish with a population of between 40,000 and 42,000 according to
the most recent federal decennial census (Webster Parish).
Present law applies exclusively to the following five parishes:
(1)Any parish with a population of not less than 40,000 persons and not more than
42,000 persons according to the most recent federal decennial census (Webster
Parish).
(2)Any parish with a population of not less than 46,000 persons and not more than
47,000 persons according to the most recent federal decennial census (Lincoln
Parish).
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(3)Any parish in which a rural institutional provider, as defined by present law, is
located (Evangeline, Jefferson Davis, and St. Landry parishes).
Proposed law revises present law such that present law and proposed law would apply
exclusively to the following six parishes:
(1)Any parish with a population of not less than 40,000 persons and not more than
42,000 persons according to the most recent federal decennial census (Webster
Parish).
(2)Any parish with a population of not less than 46,000 persons and not more than
47,000 persons according to the most recent federal decennial census (Lincoln
Parish).
(3)Any parish with a population of not less than 42,000 persons and not more than
45,000 persons according to the most recent federal decennial census (Avoyelles
Parish).
(4)Any parish with a population of between 33,500 and 35,000 according to the most
recent federal decennial census (Evangeline Parish).
(5)Any parish with a population of between 80,000 and 90,000 according to the most
recent federal decennial census (St. Landry Parish).
(6)Any parish with a population of not less than 52,300 persons and not more than
52,700 persons according to the most recent federal decennial census (Vernon
Parish).
Present law authorizes eligible parishes to collect local hospital assessment payments and
create special accounts known as "local provider participation funds". Provides that monies
in such funds may consist of these assessment payments and other funding as authorized by
present law. Stipulates that the monies in local provider participation funds may only be
used for certain purposes including the funding of intergovernmental transfers from a parish
to the state to provide the nonfederal share of Medicaid payments for the benefit of rural
institutional providers or other hospitals in the parish authorized under the state Medicaid
plan. Proposed law retains present law.
Proposed law repeals present law providing that any parishes authorized by present law to
establish a local provider participation fund may, upon agreement of the governing
authorities of each parish, establish a single fund for the benefit of those parishes and a local
hospital assessment applicable to the institutional providers in those parishes.
Proposed law provides that the governing bodies of parishes authorized by proposed law to
establish a local provider participation fund are authorized and empowered, upon their own
initiative, to form and create one or more hospital assessment districts within the respective
parishes; or, with agreement among governing bodies of parishes concerned, to combine two
or more parishes into a single hospital assessment district. Authorizes the governing bodies
of the parishes to alter the boundaries of any hospital assessment district, provided that no
such boundary change shall cause an impairment of the obligations of any contract of the
hospital assessment district.
Proposed law revises present law to stipulate that the amount of the local hospital assessment
payment required of each paying hospital may not exceed the difference between the
maximum allowable amount under federal Medicaid regulations (42 CFR 433.68(f)).
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HB NO. 453
Proposed law revises present law relative to requests by rural institutional providers, as
defined in present law, to execute cooperative endeavor agreements (CEAs) with LDH for
the use of local provider participation fund proceeds to do all of the following:
(1)Require that such requests be in writing with copies provided to the legislative
committees on health and welfare.
(2)Provide that if LDH fails to execute a CEA within 90 days of receipt of a parish
request, LDH shall report to the legislative committees on health and welfare, within
100 days of the parish request, the status of the efforts and the reason for the failure
to meet the deadline.
(3)Provide that as soon as a CEA is effective or, upon failure to agree on such
agreement, within 150 days of the parish notice unless LDH's status report is
accepted by an affirmative vote of both legislative committees on health and welfare,
LDH shall file a Medicaid state plan amendment with the federal Medicaid agency
(CMS) amending the Medicaid state plan provisions governing hospital
reimbursement to provide that a rural institutional provider shall be reimbursed at a
rate which equals or approximates the lesser of the rural institutional provider's
average commercial rate as determined by the state's Medicaid actuary or 110%, or,
if a reduction is required by CMS, the maximum amount acceptable to CMS, but in
no case less than 100%, of the appropriate reasonable cost of providing hospital
inpatient and outpatient services, including but not limited to services provided in a
rural health clinic licensed as part of a rural hospital.
(Amends R.S. 40:1248.1(6), 1248.3(3), 1248.4(D), 1248.5(A), 1248.7(C)(1), 1248.8(C) and
(D), and 1248.11(A); Adds R.S. 40:1248.1(7) and 1248.3(4)-(6))
Summary of Amendments Adopted by House
The Committee Amendments Proposed by House Committee on Health and Welfare to
the original bill:
1. Revise present law to stipulate that the amount of the local hospital assessment
payment required of each paying hospital may not exceed the difference between
the maximum allowable amount under federal Medicaid regulations (42 CFR
433.68(f)).
2. Revise present law relative to requests by rural institutional providers, as defined
in present law, to execute cooperative endeavor agreements (CEAs) with the La.
Department of Health (LDH) for the use of local provider participation fund
proceeds to require that such requests be in writing with copies provided to the
legislative committees on health and welfare.
3. Provide that if LDH fails to execute a CEA within 90 days of receipt of a parish
request, the department shall report to the legislative committees on health and
welfare, within 100 days of the parish request, the status of the efforts and the
reason for the failure to meet the deadline.
4. Provide that as soon as a CEA is effective or, upon failure to agree on such
agreement, within 150 days of the parish notice unless LDH's status report is
accepted by an affirmative vote of both legislative committees on health and
welfare, LDH shall file a Medicaid state plan amendment with the federal
Medicaid agency (CMS) amending the Medicaid state plan provisions governing
hospital reimbursement to provide that a rural institutional provider shall be
reimbursed at a rate which equals or approximates the lesser of the rural
institutional provider's average commercial rate as determined by the state's
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Medicaid actuary or 110%, or, if a reduction is required by CMS, the maximum
amount acceptable to CMS, but in no case less than 100%, of the appropriate
reasonable cost of providing hospital inpatient and outpatient services, including
but not limited to services provided in a rural health clinic licensed as part of a
rural hospital.
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