SENATE BILL 17

56th legislature - STATE OF NEW MEXICO - second session, 2024

INTRODUCED BY

Elizabeth "Liz" Stefanics and Doreen Y. Gallegos

and Michael Padilla and Jason C. Harper and Martin Hickey

 

 

 

 

AN ACT

RELATING TO HEALTH CARE; ENACTING THE HEALTH CARE DELIVERY AND ACCESS ACT; IMPOSING ON CERTAIN HOSPITALS THE HEALTH CARE DELIVERY AND ACCESS ASSESSMENT; CREATING THE HEALTH CARE DELIVERY AND ACCESS FUND; CREATING THE HEALTH CARE DELIVERY AND ACCESS MEDICAID-DIRECTED PAYMENT PROGRAM; PROVIDING THAT REVENUE FROM THE ASSESSMENT BE USED AS ADDITIONAL REIMBURSEMENT TO CERTAIN HOSPITALS; PROVIDING A DISTRIBUTION TO THE HEALTH CARE DELIVERY AND ACCESS FUND; PROVIDING THAT THE TAX ADMINISTRATION ACT APPLIES TO AND GOVERNS THE HEALTH CARE DELIVERY AND ACCESS ACT; PROVIDING A DELAYED REPEAL; PROVIDING A CONTINGENT EFFECTIVE DATE; MAKING AN APPROPRIATION.

 

BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF NEW MEXICO:

     SECTION 1. [NEW MATERIAL] SHORT TITLE.--Sections 1 through 7 of this act may be cited as the "Health Care Delivery and Access Act".

     SECTION 2. [NEW MATERIAL] DEFINITIONS.--As used in the Health Care Delivery and Access Act:

          A. "assessed days" means the number of inpatient hospital days exclusive of medicare days for each eligible hospital, with data sources to be defined by the authority and updated no less frequently than every three years;

          B. "assessed outpatient revenue" means net patient revenue exclusive of medicare outpatient revenue for outpatient services, with data sources to be defined by the authority and updated no less frequently than every three years;

          C. "assessment" means the health care delivery and access assessment;

          D. "assessment amount" means the assessment amount owed by an eligible hospital;

          E. "assessment rate" means the amount per assessed day and the percentage of assessed outpatient revenue calculated by the authority;

          F. "authority" means the health care authority department;

          G. "average commercial rate" means the average rate paid by commercial insurers as provided by the centers for medicare and medicaid services;

          H. "centers for medicare and medicaid services" means the centers for medicare and medicaid services of the United States department of health and human services;

          I. "eligible hospital" means a non-federal facility licensed as a hospital by the department of health, excluding a state university teaching hospital or a state-owned special hospital;

          J. "general acute care hospital" means a hospital other than a special hospital;

          K. "hospital" means a facility providing emergency or urgent care, inpatient medical care and nursing care for acute illness, injury, surgery or obstetrics. "Hospital" includes a facility licensed by the department of health as a critical access hospital, rural emergency hospital, general hospital, long-term acute care hospital, psychiatric hospital, rehabilitation hospital, limited services hospital or special hospital;

          L. "inpatient hospital services" means services that:

                (1) are ordinarily furnished in a hospital for the care and treatment of inpatients;

                (2) are furnished under the direction of a physician, advanced practice clinician or dentist;

                (3) are furnished in an institution that:

                     (a) is maintained primarily for the care and treatment of patients;

                     (b) is licensed or formally approved as a hospital by an officially designated authority for state standard-setting;

                     (c) meets the requirements for participation in medicare as a hospital; and

                     (d) has in effect a utilization review plan, applicable to all medicaid patients, that meets federal requirements; and

                (4) are not skilled nursing facility services or immediate care facility services furnished by a hospital with a swing-bed approval;

          M. "managed care organization" means a person or organization that has entered into a comprehensive risk-based contract with the authority to provide health care services, including inpatient and outpatient hospital services, to medicaid beneficiaries;

          N. "medicaid" means the medical assistance program established pursuant to Title 19 of the federal Social Security Act and regulations promulgated pursuant to that act;

          O. "medicaid-directed payment program" means the health care delivery and access medicaid-directed payment program created pursuant to Section 5 of the Health Care Delivery and Access Act providing additional medicaid funding for hospital services provided through medicaid managed care organizations, as directed by the authority and approved by the centers for medicare and medicaid services;

          P. "medicare days" means the number of inpatient days provided by an eligible hospital during the year to patients covered under Title 18 of the federal Social Security Act;

          Q. "medicare outpatient revenue" means the amount of net revenue received by an eligible hospital for outpatient hospital services provided to patients covered under Title 18 of the federal Social Security Act;

          R. "net patient revenue" means total net revenue received by a hospital for inpatient and outpatient hospital services in a year, as determined by the authority;

          S. "New Mexico medicaid program" means the medicaid program established pursuant to Section 27-2-12 NMSA 1978;

          T. "outpatient hospital services" means preventive, diagnostic, therapeutic, rehabilitative or palliative services that are furnished:

                (1) to outpatients;

                (2) by or under the direction of a physician, advanced practice clinician or dentist; and

                (3) by an institution that:

                     (a) is licensed or formally approved as a hospital by an officially designated authority for state standard-setting; and

                     (b) meets the requirements for participation in medicare as a hospital;

          U. "quality incentive payments" means the portion of the medicaid-directed payment program paid to hospitals based on value-based quality measurements and performance evaluation criteria, as established by the authority pursuant to Section 5 of the Health Care Delivery and Access Act;

          V. "rehabilitation hospital" means a facility licensed as a rehabilitation hospital by the department of health;

          W. "rural emergency hospital" means a facility licensed as a rural emergency hospital by the department of health;

          X. "rural hospital" means a hospital that is located in a county that has a population of one hundred twenty-five thousand or fewer according to the most recent federal decennial census;

          Y. "secretary" means the secretary of health care authority;

          Z. "small urban hospital" means a hospital that is located in a county that has a population greater than one hundred twenty-five thousand and that has fewer than fifteen licensed inpatient beds as of January 1, 2024;

          AA. "special hospital" means a facility licensed as a special hospital by the department of health; and

          BB. "uniform rate increase" means the portion of the medicaid-directed payment program paid to hospitals as a uniform dollar or percentage increase.

     SECTION 3. [NEW MATERIAL] HEALTH CARE DELIVERY AND ACCESS ASSESSMENT--RATE AND CALCULATION--NOTIFICATION.--

          A. Except as otherwise provided in this section, an assessment is imposed on inpatient hospital services and outpatient hospital services provided by an eligible hospital. The assessment rate shall be annually calculated by the authority pursuant to Subsection D of this section and the taxation and revenue department shall collect the assessment. The inpatient assessment shall be based on assessed days and the outpatient assessment shall be based on assessed outpatient revenue. The assessment provided by this section may be referred to as the "health care delivery and access assessment".

          B. The rate of the assessment on a rural hospital and special hospital shall be reduced by fifty percent, and the rate of the assessment on a small urban hospital shall be reduced by ninety percent; provided that the amount of the assessment qualifies for a waiver of the uniformity requirement for provider assessment from the centers for medicare and medicaid services. The authority may adjust these percentages and establish eligibility requirements as necessary to qualify for the waiver.

          C. The assessment shall not be imposed for any period for which the centers for medicare and medicaid services has not approved a necessary waiver or other applicable authorization required to ensure that the assessment is a permissible source of non-federal funding for medicaid program expenditures, or for which the centers for medicare and medicaid services has not approved the distribution of the medicaid-directed payment program payments.

          D. The authority shall annually calculate the assessment amount to be paid by each eligible hospital and shall annually notify the taxation and revenue department and all hospitals of the applicable rates. The authority shall calculate the assessment amount by applying the assessment rate to an eligible hospital's assessed days and assessed outpatient revenue so that total revenue from the assessment will equal the lesser of:

                (1) the amount needed, in combination with other funds deposited or expected to be deposited in the health care delivery and access fund for the subsequent fiscal year, including unexpended and unencumbered money in the fund, to provide sufficient funding for:

                     (a) the non-federal share of medicaid-directed payment program payments for inpatient and outpatient hospital services for eligible hospitals at a level such that the total reimbursement for medicaid managed care patients, including any other inpatient or outpatient hospital directed payments, is equivalent to the average commercial rate or such other maximum level as may be set by the centers for medicare and medicaid services; and

                     (b) the purposes of the health care delivery and access fund; or

                (2) the amount specified in Section 1903(w)(4)(C)(ii) of the federal Social Security Act, above which an indirect guarantee is determined to exist, with such amount determined each year based on the most recent available net patient revenue data.

          E. The authority shall notify an eligible hospital of its applicable assessment amount pursuant to the following schedule:

                (1) by November 1, 2024 for the period beginning on July 1, 2024 and ending on December 31, 2024; and

                (2) by November 1 of the preceding calendar year for each calendar year thereafter.

          F. The assessment imposed for the six-month period identified in Paragraph (1) of Subsection E of this section shall be based on assessed days and assessed outpatient revenue for a full year.

          G. The authority may require hospitals, regardless of whether they are eligible hospitals, to report information or data necessary to implement and administer the Health Care Delivery and Access Act. If the authority requires such reporting, it shall specify the frequency and due dates.

          H. The authority shall determine how the assessment is applied to newly created hospitals and hospitals that are merged, acquired or closed.

          I. A hospital shall not specifically list the cost of the assessment on any invoice, claim or statement sent to a patient, insurer, self-insured employer program or other responsible party.

     SECTION 4. [NEW MATERIAL] HEALTH CARE DELIVERY AND ACCESS FUND--CREATED.--

          A. The "health care delivery and access fund" is created as a nonreverting fund in the state treasury. The fund consists of distributions, appropriations, transfers, gifts, grants, donations, bequests and income from investment of the fund. The authority shall administer the fund. Money in the fund is appropriated to the authority for the purposes of the fund provided in Subsection B of this section. Expenditures from the fund shall be by warrant of the secretary of finance and administration pursuant to vouchers signed by the secretary of health care authority or the secretary's authorized representative.

          B. Money in the health car