SB331 Alabama 2018 Session

Summary

Primary Sponsor

Tim MelsonSenator

Republican

Session

Regular Session 2018

Title

Rural Hospital Transformation and Stability Act, Ala. Rural Hospital Global Budget Board established, funding for rural hospitals accepted into program through global payment from certain insurers

Summary

SB 331 would create the Rural Hospital Transformation and Stability Act to establish a state board and pilot a global budget program that provides stable funding to eligible rural hospitals through fixed global payments.

What This Bill Does

It creates the Alabama Rural Hospital Global Budget Board and authorizes a pilot global budget program to support sustainability and transformation of rural health care. Eligible rural hospitals would receive stable funding through a global payment funded by participating public and private insurers and local communities, with the board setting payment amounts. Hospitals in the program must work toward agreed population health, access/quality, and financial targets, and participation is voluntary but subject to criteria and limits in early years; the program’s Medicaid participation would depend on CMS approval, and the board can terminate the program if it is ineffective or unsustainable.

Who It Affects

• Rural hospitals in Alabama that choose to participate; they would receive stable, global payments and must meet targets and criteria set by the board.
• Public and private payors, including counties/municipalities and communities that fund the global payments, and state/federal health plans (such as Medicaid, Medicare Advantage, and the largest state health plan) that may participate or be required to participate through the global budget model.

Key Provisions

• Establishes the Alabama Rural Hospital Global Budget Board and defines its composition, including state Medicaid and mental health commissioners, hospital and medical associations, representatives from participating hospitals, the University of Alabama at Birmingham, the Resource Center, the State Health Officer, a major health plan, and Medicare Advantage representation.
• Authorizes a pilot global budget program for rural hospitals, with the board setting global payments, participation criteria, and the number of hospitals allowed to participate in early years (no more than 2 in year 1 and no more than 5 in year 3).
• Defines Global Payment, Service Area, and Resource Center, and authorizes the board to adopt rules, establish payment amounts, and ensure participation by public and private payors.
• Participation is voluntary for hospitals, requiring nonprofit status, rural location, local funding agreement, acceptance of global payments, and agreement to meet specified health, access, quality, and financial targets, with possible continuation even if rural location criteria later change.
• Requires payors to participate in the global budget model and reimburse through global payments; Medicaid participation requires CMS approval, while other payors may participate; local governments fund at least 10% of the global payment or the hospital’s current tax revenue, with remaining funds from payors proportional to their service area population.
• Allows the board to terminate the program if it is ineffective or unsustainable and assigns financial responsibility for board costs to the Resource Center.

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

Subjects

Health Care