HB605 Alabama 2013 Session

Summary

Primary Sponsor

Steve ClouseRepresentative

Republican

Session

Regular Session 2013

Title

Hospitals, private hospital assessments for Medicaid funding, extended until 2016, public hospitals exempt, intergovernmental transfer for Medicaid funding, Secs. 40-26B-70, 40-26B-71, 40-26B-73, 40-26B-77, 40-26B-78, 40-26B-79, 40-26B-80, 40-26B-82, 40-26B-84, 40-26B-88 am'd.; Sec. 40-26B-77.1 added

Summary

HB605 extends and changes the private hospital assessment and Medicaid funding program through 2016, and requires state-owned and public hospitals to make intergovernmental transfers to help pay for Medicaid inpatient and outpatient care.

What This Bill Does

It extends the private hospital assessment program for fiscal years 2014–2016 and sets the base year to 2011 with a 5.50% assessment rate. It adds a requirement that state-owned and publicly owned hospitals make intergovernmental transfers to the Medicaid Agency to fund payments for inpatient and outpatient care, with certified public expenditures used for uncompensated care and to pay disproportionate share (DSH) payments. It creates a Hospital Assessment Account to hold these funds, keep them separate from the General Fund, and use them to pay hospital access and base payments, while protecting against budget cuts and ensuring federal matching funds when possible. It also ties the program to federal participation and allows refunds if the program becomes impermissible or federal funding changes reduce Medicaid matching.

Who It Affects

• Privately operated hospitals – must pay a 5.50% assessment on net patient revenue for 2014–2016 and are eligible for hospital access payments up to the applicable upper payment limit, funded by the overall program.
• State-owned and public hospitals – must begin intergovernmental transfers to the Medicaid Agency (starting Oct 1, 2013) to help fund inpatient/outpatient care payments and access payments; their certified public expenditures are used for uncompensated care and DSHP.
• Medicaid Agency – administers the transfer mechanism to obtain federal matching funds, determines payment amounts (base and access payments), and uses funds to pay hospitals.
• Hospitals overall – potential changes to payment levels and the availability of federal matching funds; refunds to hospitals if funds are not needed or if the program ends due to federal rules.

Key Provisions

• Extend the private hospital assessment and Medicaid funding program through fiscal years 2014, 2015, and 2016; change the base year to fiscal year 2011 for calculating the assessment; set the assessment rate at 5.50% of net patient revenue for 2014–2016.
• Add Section 40-26B-77.1 requiring publicly owned and state-owned hospitals to make intergovernmental transfers to the Medicaid Agency starting October 1, 2013, equal to the amount needed for the federal match to pay hospitals for direct inpatient/outpatient care and access payments.
• Require that intergovernmental transfers support payments to state-owned/public hospitals and funding of inpatient/outpatient access payments, aligned with certified public expenditures for uncompensated care and DSHP payments.
• Create the Hospital Assessment Account in the Health Care Trust Fund; funds come from hospital assessments, interest/penalties, and other sources; the account is separate from the General Fund and cannot be used to replace other Medicaid funding.
• Allow balances in the Hospital Assessment Account to reduce future assessments or be refunded to hospitals if not needed, and ensure funds are used only for inpatient/outpatient payments or related reimbursements, and only to the extent federal matching funds are available.
• Prescribe base and outpatient payment calculations using specific Medicare Cost Report data (with staggered data years: 2007 for 2010–2011, 2009 for 2012–2013, and 2011 for 2014–2016), with hospitals required to provide reports if data are unavailable.
• Require that hospital access payments (inpatient and outpatient) be made on a quarterly basis and not used to offset other Medicaid payments; specify upper payment limit targets for publicly/state-owned and privately operated hospitals.
• Provide that the act has no effect if federal financial participation under Title XIX is unavailable; any pre-existing federal funds would be disbursed or refunded to hospitals proportionally if the assessment is halted.

AI-generated summary using openai/gpt-5-nano on Feb 24, 2026. May contain errors — refer to the official bill text for accuracy.

Subjects

Medicaid