82R10636 CJC-F
By: Ellis S.B. No. 1819
A BILL TO BE ENTITLED
AN ACT
relating to charity care provided by certain nonprofit hospitals.
BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF TEXAS:
SECTION 1. Section 311.031(16), Health and Safety Code, is
amended to read as follows:
(16) "Unreimbursed costs" means the costs a hospital
incurs for providing individuals inpatient and outpatient services
for which the hospital does not receive reimbursement from any
source, including a third-party payor. The term does not include
payor discounts or contractual adjustments in reimbursements to
third-party payors or costs for which the hospital receives any
partial payment for the related service, [after subtracting
payments received from any source for such services] including but
not limited to the following: third-party insurance payments;
Medicare payments; Medicaid payments; Medicare education
reimbursements; payments from Tricare or the Civilian Health and
Medical Program of the Uniformed Services; state reimbursements for
education; payments from drug companies to pursue research; grant
funds for research; and disproportionate share payments. For
purposes of this definition, the term "costs" shall be calculated
by applying the cost to charge ratios, according to the hospital's
most recently filed Medicare cost report, [derived in accordance
with generally accepted accounting principles for hospitals] to
billed charges. For [The calculation of the cost to charge ratios
shall be based on the most recently completed and audited prior
fiscal year of the hospital or hospital system. Prior to January 1,
1996, for purposes of this definition, charitable contributions and
grants to a hospital, including transfers from endowment or other
funds controlled by the hospital or its nonprofit supporting
entities, shall not be subtracted from the costs of providing
services for purposes of determining unreimbursed costs. After
January 1, 1996, for] purposes of this definition, charitable
contributions and grants to a hospital, including transfers from
endowment or other funds controlled by the hospital or its
nonprofit supporting entities, shall not be subtracted from the
costs of providing services for purposes of determining the
unreimbursed costs of charity care and government-sponsored
indigent health care.
SECTION 2. Section 311.033(a), Health and Safety Code, is
amended to read as follows:
(a) A hospital shall submit to the department financial and
utilization data for that hospital, including data relating to the
hospital's:
(1) total gross revenue, including:
(A) Medicare gross revenue;
(B) Medicaid gross revenue;
(C) other revenue from state programs;
(D) revenue from local government programs;
(E) local tax support;
(F) charitable contributions;
(G) other third party payments;
(H) gross inpatient revenue; [and]
(I) gross outpatient revenue;
(J) disproportionate share hospitals payment
program revenue;
(K) upper payment limit supplemental payment
program revenue;
(L) tobacco settlement proceeds; and
(M) federal grant funding, including payments
made for care for undocumented persons;
(2) total deductions from gross revenue, including:
(A) contractual allowance; and
(B) any other deductions;
(3) charity care;
(4) bad debt expense;
(5) total admissions, including:
(A) Medicare admissions;
(B) Medicaid admissions;
(C) admissions under a local government program;
(D) charity care admissions; and
(E) any other type of admission;
(6) total discharges;
(7) total patient days;
(8) average length of stay;
(9) total outpatient visits;
(10) total assets;
(11) total liabilities;
(12) estimates of unreimbursed costs of subsidized
health services reported separately in the following categories:
(A) emergency care and trauma care;
(B) neonatal intensive care;
(C) free-standing community clinics;
(D) collaborative efforts with local government
or private agencies in preventive medicine, such as immunization
programs; and
(E) other services that satisfy the definition of
"subsidized health services" contained in Section 311.031(15)
[311.031(13)];
(13) donations;
(14) total cost of reimbursed and unreimbursed
research;
(15) total cost of reimbursed and unreimbursed
education separated into the following categories:
(A) education of physicians, nurses,
technicians, and other medical professionals and health care
providers;
(B) scholarships and funding to medical schools,
colleges, and universities for health professions education;
(C) education of patients concerning disease
management [diseases] and in-home [home] care in response to
community needs;
(D) community health education through promotion
and disease prevention [informational] programs, publications, and
outreach activities in response to community needs; and
(E) other educational services that satisfy the
definition of "education-related costs" under Section 311.031(6);
and
(16) charge description master or charge master.
SECTION 3. Section 311.042(2), Health and Safety Code, is
amended to read as follows:
(2) "Community benefits" means the unreimbursed cost
to a hospital of providing charity care, government-sponsored
indigent health care, donations, education, government-sponsored
program services, including unreimbursed costs resulting from
defined services covered by Medicare, Medicaid, Tricare, or the
Civilian Health and Medical Program of the Uniformed Services,
research, and subsidized health services. Community benefits
include community-based prevention programs and programs or
services to reduce health disparities in the community served by
the hospital by increasing the proportion of the population that
has access to health information and disease prevention that are
described by the Guide to Community Preventive Services published
by the Centers for Disease Control and Prevention of the United
States Public Health Service. The term does not include the cost to
the hospital of paying any taxes or other governmental assessments,
uncollected fees, or accounts written off as bad debt.
SECTION 4. Section 311.043(c), Health and Safety Code, is
amended to read as follows:
(c) Reductions in the amount of community benefits, which
include [includes] charity care and government-sponsored indigent
health care, provided by a nonprofit hospital shall be considered
reasonable when [the financial reserves of the hospital are reduced
to such a level that the hospital would be in violation of any
applicable bond covenants, when] necessary to prevent the hospital
from endangering its ability to continue operations, or if the
hospital, as a result of a natural or other disaster, is required
substantially to curtail its operations.
SECTION 5. This Act takes effect September 1, 2011.