SB189 Alabama 2023 Session

Summary

Primary Sponsor

Greg AlbrittonSenator

Republican

Session

Regular Session 2023

Title

Relating to Medicaid; to amend Section 40-26B-26, Code of Alabama 1975, to revise the circumstances under which the Alabama Medicaid Agency may revise the ceiling for the Medicaid reimbursement rate to nursing facilities during a given fiscal year; and to make nonsubstantive, technical revisions to update the existing code language to current style.

Summary

SB189 lets Alabama Medicaid adjust nursing facility reimbursement ceilings mid-year for unforeseen cost increases and adds new quality incentives and special payment provisions.

What This Bill Does

The bill authorizes the Medicaid Agency to revise the annual ceiling for nursing facility reimbursements during a fiscal year when facilities cannot be reimbursed for increases in allowable costs due to unforeseen circumstances. It keeps the existing reimbursement framework but specifies how ceilings are calculated for operating and direct patient care costs and sets limits on how much ceilings can rise each year. It also creates optional enhancements and a quality incentive program, and adds provisions related to asset value adjustments and data accuracy in rate setting. The act takes effect after passage and governor approval, with certain provisions applying to rates and payments starting around 2020-2023 timelines described in the text.

Who It Affects

• Medicaid-participating nursing facilities: may receive mid-year adjustments to their rate ceilings, guidance on costCenter calculations, and eligibility for new special reimbursement and quality incentive programs.
• Nursing home residents enrolled in Medicaid: could be affected indirectly through changes in reimbursement levels, funding for quality incentives, and potential improvements in care standards.

Key Provisions

• Authorizes the Alabama Medicaid Agency to revise the annual ceiling for nursing facility reimbursement during a fiscal year if facilities cannot be reimbursed for increases in allowable costs due to unforeseen circumstances such as emergencies, new laws or regulations, or a statewide catastrophic event.
• Ceiling calculations defined: operating cost center ceiling is the median plus 5%; direct patient care cost center ceiling is the median plus 10% and the provider's actual allowable cost per patient day plus 11% or the established ceiling plus 11%, whichever is less; inflation index used without trend factor variance.
• Annual ceiling increases are limited by a rule that the increase over the previous year's ceiling cannot exceed the product of the previous year's ceiling times (Medicaid Inflation Index plus 4%).
• Special reimbursement model allows enhanced payments for dedicated ventilator units meeting specific requirements (eg., power, gases, 24/7 staff, physician oversight).
• Enhancement for rural hospital-connected nursing facilities under governmental authority, up to Medicare upper limits, not restricted by the standard rate rules.
• Quality incentive program requiring at least $5,000,000 per scoring period; payments are based on performance in CMS quality measures and NRC or equivalent satisfaction surveys; facilities must improve or rank at/above national average to earn points.
• Recalculation of current asset value for rate setting beginning July 1, 2020, with adjustments (including a specified percentage increase) that affect future rate calculations; resulting rate increases become effective October 1, 2020, and not before.
• Provisions to ensure data accuracy in cost reporting and allowances for corrections detected during audits.
• Effective date: the act becomes effective on the first day of the third month after passage and governor approval.

AI-generated summary using openai/gpt-5-nano on Feb 22, 2026. May contain errors — refer to the official bill text for accuracy.

Subjects

Medicaid, circumstances for revising reimbursement rates to nursing facilities revised