I
106TH CONGRESS
2D SESSION
H. R. 5621
To amend the Balanced Budget Act of 1997 to apply the Medicaid dispropor-
tionate share hospital payment transition rule to public hospitals in
all States.
IN THE HOUSE OF REPRESENTATIVES
NOVEMBER 1, 2000
Mr. RUSH introduced the following bill; which was referred to the Committee
on Commerce
A BILL
To amend the Balanced Budget Act of 1997 to apply the
Medicaid disproportionate share hospital payment transi-
tion rule to public hospitals in all States.
Be it enacted by the Senate and House of Representa-
tives of the United States of America in Congress assembled,
SECTION 1. SHORT TITLE.
This Act may be cited as the ‘‘Medicaid DSH Fair-
ness Act of 2000’’.
SEC. 2. EXPANSION OF APPLICATION OF MEDICAID DSH
TRANSITION RULE TO PUBLIC HOSPITALS IN
ALL STATES.
(a) APPLICATION TO PUBLIC HOSPITALS IN ALL
STATES.—
(1) IN GENERAL.—Section 4721(e) of the Bal-
anced Budget Act of 1997 (Public Law 105–33; 111
Stat. 514), as amended by section 607 of the Medi-
care, Medicaid, and SCHIP Balanced Budget Re-
finement Act of 1999 (Appendix F, 113 Stat.
1501A–321), as enacted into law by section
1000(a)(6) of Public Law 106–113, is amended—
(A) by striking ‘‘July 1, 1997’’ each place
it appears and inserting ‘‘October 1, 2000’’;
(B) by striking ‘‘the State of California’’
and inserting ‘‘hospitals owned or operated by
a State (as defined for purposes of title XIX of
such Act), or by an instrumentality or a unit of
government within a State (as so defined)’’;
(C) by redesignating paragraph (3) as
paragraph (4);
(D) by striking ‘‘and’’ at the end of para-
graph (2); and
(E) by inserting after paragraph (2), the
following new paragraph:
‘‘(3) ‘(as defined in subparagraph (B) but with-
out regard to clause (ii) of that subparagraph and
subject to subsection (d))’ were substituted for ‘(as
defined in subparagraph (B))’ in subparagraph (A)
of such section; and’’.
(2) SPECIAL RULE.—With respect to California,
section 4721(e) of the Balanced Budget Act of 1997
(Public Law 105–33; 111 Stat. 514) as amended by
section 607 of BBRA (113 Stat. 1501A–321) shall
be applied without regard to the amendments made
by paragraph (1).
(3) EFFECTIVE DATE.—The amendments made
by paragraph (1) take effect on July 1, 2002.
(b) APPLICATION TO CERTAIN STATES.—
(1) IN GENERAL.—Beginning with fiscal year
2002, notwithstanding section 1923(f) of the Social
Security Act (42 U.S.C. 1396r–4(f)) and subject to
paragraph (3), with respect to a State, payment ad-
justments made under title XIX of such Act (42
U.S.C. 1396 et seq.) after the application of section
4721(e) of the Balanced Budget Act of 1997 (as
amended by subsection (a)(1)) to any hospital de-
scribed in paragraph (2) located in the State shall
be made without regard to the DSH allotment limi-
tation for the State determined under section
1923(f) of that Act (42 U.S.C. 1396r–4(f)).
(2) HOSPITAL DESCRIBED.—A hospital is de-
scribed in this paragraph if the hospital—
(A) is described in section 4721(e) of the
Balanced Budget Act of 1997 (as amended by
subsection (a)(1));
(B) as of October 1, 2000—
(i) is in existence and operating as a
hospital described in such section (as so
amended); and
(ii) is not receiving disproportionate
share hospital payments from the State in
which it is located under title XIX of such
Act; and
(C) has a low-income utilization rate (as
defined in section 1923(b)(3) of the Social Se-
curity Act (42 U.S.C. 1396r–4(b)(3))) in excess
of 65 percent.
(3) LIMITATION ON EXPENDITURES.—
(A) IN GENERAL.—With respect to any fis-
cal year, the aggregate amount of Federal fi-
nancial participation that may be provided for
payment adjustments described in paragraph
(1) for that fiscal year may not exceed the
amount described in subparagraph (B) for the
fiscal year.
(B) AMOUNT
DESCRIBED.—The amount
described in this subparagraph for a fiscal year
is as follows:
(i) For fiscal year 2002, $15,000,000.
(ii) 
For 
fiscal 
year 
2003,
$176,000,000.
(iii) 
For 
fiscal 
year 
2004,
$270,000,000.
(iv) 
For 
fiscal 
year 
2005,
$330,000,000.
(v) For fiscal year 2006 and each fis-
cal year thereafter, $375,000,000.
(c) APPLICATION TO WAIVERS.—With respect to a
State medicaid program operating under a Statewide
waiver of the requirements of title XIX of the Social Secu-
rity Act (42 U.S.C. 1396 et seq.) under section 1115 of
such Act (42 U.S.C. 1315), to the extent that the amend-
ment made by subsection (a)(1) would modify the total
amount that the State would expend under such title in
a fiscal year if the State were not operating under such
a waiver, the Secretary of Health and Human Services
shall revise the budget neutrality baseline expenditure
limit applicable to the waiver to reflect the increase in
State expenditures under the medicaid program for such
fiscal year that would be incurred in the absence of the
waiver as a result of such amendment. Such modified
budget neutrality baseline expenditure limit shall take ef-
fect on the effective date described in subsection (a)(3).
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