II

106TH CONGRESS

2D SESSION S. 3255

To amend the Balanced Budget Act of 1997 to apply the medicaid disproportionate share hospital payment transition rule to public hospitals in

all States.

IN THE SENATE OF THE UNITED STATES

OCTOBER 27 (legislative day, SEPTEMBER 22), 2000

Mr. DASCHLE (for Mr. DURBIN (for himself, Mr. MOYNIHAN, and Mr. SCHUMER)) introduced the following bill; which was read twice and referred

to the Committee on Finance

A BILL

To amend the Balanced Budget Act of 1997 to apply the

medicaid disproportionate share hospital payment transition rule to public hospitals in all States.

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 ‘‘Medicaid DSH Fair5 ness Act of 2000’’.
2

•S 3255 IS

1 SEC. 2. EXPANSION OF APPLICATION OF MEDICAID DSH

2 TRANSITION RULE TO PUBLIC HOSPITALS IN

3 ALL STATES.

4 (a) APPLICATION TO PUBLIC HOSPITALS IN ALL

5 STATES.—

6 (1) IN GENERAL.—Section 4721(e) of the Bal7 anced Budget Act of 1997 (Public Law 105–33; 111

8 Stat. 514), as amended by section 607 of the Medi9 care, Medicaid, and SCHIP Balanced Budget Re10 finement Act of 1999 (Appendix F, 113 Stat.

11 1501A–321), as enacted into law by section

12 1000(a)(6) of Public Law 106–113, is amended—

13 (A) by striking ‘‘July 1, 1997’’ each place

14 it appears and inserting ‘‘October 1, 2000’’;

15 (B) by striking ‘‘the State of California’’

16 and inserting ‘‘hospitals owned or operated by

17 a State (as defined for purposes of title XIX of

18 such Act), or by an instrumentality or a unit of

19 government within a State (as so defined)’’;

20 (C) by redesignating paragraph (3) as

21 paragraph (4);

22 (D) by striking ‘‘and’’ at the end of para23 graph (2); and

24 (E) by inserting after paragraph (2), the

25 following new paragraph:
3

•S 3255 IS

1 ‘‘(3) ‘(as defined in subparagraph (B) but with2 out regard to clause (ii) of that subparagraph and

3 subject to subsection (d))’ were substituted for ‘(as

4 defined in subparagraph (B))’ in subparagraph (A)

5 of such section; and’’.

6 (2) SPECIAL RULE.—With respect to California,

7 section 4721(e) of the Balanced Budget Act of 1997

8 (Public Law 105–33; 111 Stat. 514) as amended by

9 section 607 of BBRA (113 Stat. 1501A–321) shall

10 be applied without regard to the amendments made

11 by paragraph (1).

12 (3) EFFECTIVE DATE.—The amendments made

13 by paragraph (1) take effect on July 1, 2002.

14 (b) APPLICATION TO CERTAIN STATES.—

15 (1) IN GENERAL.—Beginning with fiscal year

16 2002, notwithstanding section 1923(f) of the Social

17 Security Act (42 U.S.C. 1396r–4(f)) and subject to

18 paragraph (3), with respect to a State, payment ad19 justments made under title XIX of such Act (42

20 U.S.C. 1396 et seq.) after the application of section

21 4721(e) of the Balanced Budget Act of 1997 (as

22 amended by subsection (a)(1)) to any hospital de23 scribed in paragraph (2) located in the State shall

24 be made without regard to the DSH allotment limi-
4

•S 3255 IS

1 tation for the State determined under section

2 1923(f) of that Act (42 U.S.C. 1396r–4(f)).

3 (2) HOSPITAL DESCRIBED.—A hospital is de4 scribed in this paragraph if the hospital—

5 (A) is described in section 4721(e) of the

6 Balanced Budget Act of 1997 (as amended by

7 subsection (a)(1));

8 (B) as of October 1, 2000—

9 (i) is in existence and operating as a

10 hospital described in such section (as so

11 amended); and

12 (ii) is not receiving disproportionate

13 share hospital payments from the State in

14 which it is located under title XIX of such

15 Act; and

16 (C) has a low-income utilization rate (as

17 defined in section 1923(b)(3) of the Social Se18 curity Act (42 U.S.C. 1396r–4(b)(3))) in excess

19 of 65 percent.

20 (3) LIMITATION ON EXPENDITURES.—

21 (A) IN GENERAL.—With respect to any fis22 cal year, the aggregate amount of Federal fi23 nancial participation that may be provided for

24 payment adjustments described in paragraph

25 (1) for that fiscal year may not exceed the
5

•S 3255 IS

1 amount described in subparagraph (B) for the

2 fiscal year.

3 (B) AMOUNT DESCRIBED.—The amount

4 described in this subparagraph for a fiscal year

5 is as follows:

6 (i) For fiscal year 2002, $15,000,000.

7 (ii) For fiscal year 2003,

8 $176,000,000.

9 (iii) For fiscal year 2004,

10 $270,000,000.

11 (iv) For fiscal year 2005,

12 $330,000,000.

13 (v) For fiscal year 2006 and each fis14 cal year thereafter, $375,000,000.

15 (c) APPLICATION TO WAIVERS.—With respect to a

16 State medicaid program operating under a Statewide

17 waiver of the requirements of title XIX of the Social Secu18 rity Act (42 U.S.C. 1396 et seq.) under section 1115 of

19 such Act (42 U.S.C. 1315), to the extent that the amend20 ment made by subsection (a)(1) would modify the total

21 amount that the State would expend under such title in

22 a fiscal year if the State were not operating under such

23 a waiver, the Secretary of Health and Human Services

24 shall revise the budget neutrality baseline expenditure

25 limit applicable to the waiver to reflect the increase in
6

•S 3255 IS

1 State expenditures under the medicaid program for such

2 fiscal year that would be incurred in the absence of the

3 waiver as a result of such amendment. Such modified

4 budget neutrality baseline expenditure limit shall take ef5 fect on the effective date described in subsection (a)(3).

Æ