NOTE: As provided in LFC policy, this report is
intended only for use by the standing finance committees of the
legislature. The Legislative Finance Committee does not assume
responsibility for the accuracy of the information in this report when used for
other purposes.
The most recent FIR
version (in HTML & Adobe PDF formats) is available on the Legislative
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F I S C A
L I M P A C T R E P O R T
SPONSOR:
|
Jennings
|
DATE TYPED:
|
03/10/03
|
HB
|
|
SHORT TITLE:
|
Indigent Health Care Reimbursement
|
SB
|
524/aSPAC/aSFC/aSFl#1
|
|
ANALYST:
|
Weber
|
|
|
|
|
|
|
|
|
APPROPRIATION
Appropriation
Contained
|
Estimated
Additional Impact
|
Recurring
or
Non-Rec
|
Fund
Affected
|
FY03
|
FY04
|
FY03
|
FY04
|
|
|
|
|
|
NFI
|
|
|
(Parenthesis
( ) Indicate Expenditure Decreases)
SOURCES
OF INFORMATION
Responses
Received From
Department
of Finance and Administration
Human
Services Department
Department
of health
Health
Policy Commission
SUMMARY
Synopsis of SFl Amendment #1
The Senate Floor Amendment makes the following
changes:
The Senate Floor Amendment for items 1 and 2 are the
same as items 3 and 4 of the Senate Finance Committee amendment. These changes restore the intent of the
original statute to have tiered allowable administrative costs dependent on the
size of the indigent fund.
Synopsis of SFC
Amendment
The Senate Finance Committee Amendment makes the
following changes:
- Strikes the Senate Public Affairs Committee Amendment 2. This is “On page 4, strike lines 20 through
25 in their entirety and insert in lieu thereof "based on medicaid fee-for-service reimbursement rates;".
- In the place of the
above insert “based on medicaid fee-for-service
reimbursement rates for hospitals, licensed medical doctors and
osteopathic physicians;”. This
change clarifies how allowable costs are to be determined.
- On page 8, lines 12
through 22 removes the brackets and line through. This leaves the original concept to
allow tiered administrative cost expenses based on the size of the fund.
- On page 8, line 14,
strikes shall not exceed. This
restores the original statute with tiered administrative cost percentages.
- On page 8, line 15,
strikes the semicolon.
- On page 10, between
lines 23 and 24, inserts the following new subsection.
“O.
shall, in carrying out the provisions of the Indigent Hospital and County Health
Care Act, comply with
the standards of the federal Health Insurance Portability
and Accountability Act of 1996;”
Synopsis of SPAC Amendment
The
Senate Public Affairs Committee Amendment makes the following changes;
- In the definition
for “cost”, alternate pricing structures are omitted, leaving only “based
on Medicaid reimbursement rates”.
- On page 7, strike
lines 3 through 5 entirely and insert “providing emergency services, as
determined by the board, in a hospital to an indigent patient”. This leaves the definition of emergency
up to the local board.
- On page 13, line 11
after the second “year” insert “based on a report prepared by the hospital
using a format jointly proscribed by the counties and hospitals that
provides aggregate data, including the number of indigent patients served
and the total cost of uncompensated care provided by the hospital”. This better defines reporting
requirements.
- On page 13, line 15
after the semicolon insert “provided that the agreements shall be in
compliance with federal regulations regarding intergovernmental transfers
and provider contributions and shall not include provisions for
reimbursements to counties of matching and sole community provider fund
allocations”. This provision better
defines the agreements.
- The remainder of
the changes is minor language refinements with the exception of deletion
of section F. that referred to audit requirements.
Synopsis
of Original Bill
Senate Bill 524 (SB 524) amends sections of NMSA 1978 which
govern payments to hospitals under the Indigent Hospital and County Health Care Act. SB 524 would not allow hospitals to be paid
from the fund for services rendered to an indigent patient that is eligible for
Medicaid. SB 524 would permit counties
to use Medicaid reimbursement rates as a basis for payments to eligible health
care service providers. SB 524 would
specify that counties be permitted administrative costs for County Indigent
Hospital Claims Funds up to ten percent of the amount of revenues in the fund,
and eliminates language that limits costs to less than ten percent under
certain circumstances.
SB 524 directs counties to confirm the amount of the sole
community provider payments authorized by each hospital in a fiscal year by
auditing the reported amounts in the same manner that that other state and county funds are
audited.
Significant
Issues
Currently, counties must conduct independent
cost analyses of health care providers to use as the basis for setting payments
under the Indigent
Hospital
and County Health Care Act. With enactment of the modifications in SB 524,
counties can rely on established Medicaid reimbursement levels, bypassing the
need for these extra analyses. This should permit significant administrative
savings for counties.
Currently,
hospitals certify expenditures used for match purposes associated with the Sole
Community Provider Fund. The provisions of SB 524 will permit counties to
verify through audit the expenditures certified by hospitals for match
purposes. This proposed change will improve accountability at the local level.
The
Indigent
Hospital
and County Health Care Act establishes a multi-step formula for calculating the
maximum permitted administrative costs that can be charged by counties to their
individual County Indigent Care Funds. The formula is stepped based upon the
amount of money in the Funds. The current formula allows the following
administrative expenses: 1) up to ten percent of the revenues in the fund under
$500,000, 2) eight percent of the amount of revenue in the fund from $500,000
to not over $1 million, and 3) four and one-half percent of the amount of the
revenues in the fund over $1 million.
The changes proposed in SB 524 will permit a 10% maximum administrative
limit for at all balance levels.
FISCAL IMPLICATIONS
No direct fiscal
implications are identified by any reporting agencies.
MW/yr:sb:njw:yr