II 

116TH CONGRESS 

2D SESSION S. 5077 

To amend title XIX of the Social Security Act to adjust the limitations 

on Medicaid disproportionate share hospital payments. 

IN THE SENATE OF THE UNITED STATES 

DECEMBER 20, 2020 

Mr. CORNYN introduced the following bill; which was read twice and referred 

to the Committee on Finance 

A BILL 

To amend title XIX of the Social Security Act to adjust 

the limitations on Medicaid disproportionate share hospital payments. 

1 Be it enacted by the Senate and House of Representa2 tives of the United States of America in Congress assembled, 

3 SECTION 1. SHORT TITLE. 

4 This Act may be cited as the ‘‘Children’s Hospital 

5 Protection Act’’. 

6 SEC. 2. MEDICAID SHORTFALL AND THIRD-PARTY PAY7 MENTS. 

8 (a) IN GENERAL.—Subsection (g) of section 1923 of 

9 the Social Security Act (42 U.S.C. 1396r–4) is amended 

10 to read as follows: 


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1 ‘‘(g) LIMIT ON AMOUNT OF PAYMENT TO HOS2 PITAL.— 

3 ‘‘(1) IN GENERAL.— 

4 ‘‘(A) AMOUNT OF ADJUSTMENT SUBJECT

5 TO UNCOMPENSATED COSTS.—A payment ad6 justment during a fiscal year shall not be con7 sidered to be consistent with subsection (c) with 

8 respect to a hospital (other than a hospital de9 scribed in paragraph (2)(B)) if the payment ad10 justment exceeds an amount equal to— 

11 ‘‘(i) the costs incurred during the year 

12 of furnishing hospital services by the hos13 pital to individuals described in subpara14 graph (B) minus— 

15 ‘‘(ii) the sum of— 

16 ‘‘(I) payments under this title 

17 (other than under this section) for 

18 such services; and 

19 ‘‘(II) payments by uninsured pa20 tients for such services. 

21 ‘‘(B) INDIVIDUALS DESCRIBED.—For pur22 poses of subparagraph (A), the individuals de23 scribed in this clause are the following: 

24 ‘‘(i) Individuals who are eligible for 

25 medical assistance under the State plan or 


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1 under a waiver of such plan and for whom 

2 the State plan or waiver is the primary 

3 payor for such services. 

4 ‘‘(ii) Subject to subparagraph (C), in5 dividuals who have no health insurance (or 

6 other source of third party coverage) for 

7 services provided during the year, as deter8 mined by the Secretary. 

9 ‘‘(C) EXCLUSION OF CERTAIN PAY10 MENTS.—For purposes of subparagraph (B)(ii), 

11 payments made to a hospital for services pro12 vided to indigent patients made by a State or 

13 a unit of local government within a State shall 

14 not be considered to be a source of third party 

15 coverage. 

16 ‘‘(2) APPLICATION OF LIMITS FOR CERTAIN

17 HOSPITALS.— 

18 ‘‘(A) IN GENERAL.—A payment adjust19 ment during a fiscal year shall not be consid20 ered to be consistent with subsection (c) with 

21 respect to a hospital described in subparagraph 

22 (B) if the payment adjustment exceeds the 

23 higher of— 


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1 ‘‘(i) the amount determined for the 

2 hospital and fiscal year under paragraph 

3 (1)(A); and 

4 ‘‘(ii) the amount determined for the 

5 hospital under paragraph (1)(A) as in ef6 fect on January 1, 2020. 

7 ‘‘(B) HOSPITALS DESCRIBED.—A hospital 

8 is described in this subparagraph for a fiscal 

9 year if, for the most recent cost reporting pe10 riod ending before such fiscal year, the hospital 

11 is in at least the 98th percentile of all hospitals 

12 with respect to the number of hospital days for 

13 such period that were made up of patients who 

14 (for such days) were entitled to benefits under 

15 part A of title XVIII and were entitled to sup16 plemental security income benefits under title 

17 XVI (excluding any State supplementary bene18 fits paid with respect to such patients).’’. 

19 (b) EFFECTIVE DATE.—The amendment made by 

20 this section shall take effect on October 1, 2021, and shall 

21 apply to payment adjustments made under section 1923 

22 of the Social Security Act (42 U.S.C. 1396r–4) during fis23 cal years beginning on or after such date. 

Æ 


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