HB2542 - 531R - House Bill Summary

Abstract

Relating to Health and the FY 2018 state budget.

Provisions

Arizona Department of Health Services

1. Establishes the Fund which consists of legislative appropriations.

a. Specifies that Fund monies are exempt from the lapsing of appropriations and continuously appropriated. (Sec. 1)

2. Requires the Director of ADHS to administer the Fund. (Sec. 1)

3. Permits Fund monies to be spent for public health emergency responses following a state of emergency declaration by the Governor. (Sec. 1)

4. Requires ADHS to:

a. Annually report any Fund expenditures to JLBC by September 1^st;

b. Submit a grant application to HHS for monies necessary to provide family planning services;

i. Grant application is to be submitted annually or on an otherwise applicable basis.

c. Emphasize in the application that the state is best suited to receive and distribute monies for the state; and

d. Distribute grant monies pursuant to the statutory requirements for family planning services monies. (Sec. 2)

5. Permits ADHS to use Health Research Account monies in an amount specified in the General Appropriations Act, for Alzheimer's disease research. (Sec. 24)

Arizona Health Care Cost Containment System

6. Requires AHCCCS to annually report to JLBC and OSPB on the use of emergency departments for non-emergency purposes by enrollees beginning December 1, 2017. (Sec. 3)

7. Adds occupational therapy on an outpatient basis as a covered service. (Sec. 4)

o AHCCCS currently provides coverage for occupational therapy services in an inpatient hospital setting to all enrollees. These services are covered by AHCCCS in an outpatient setting for enrollees under age 21 and members of ALTCS. (A.R.S. § 36-2907)

8. Adds emergency dental care and extractions for persons who are least 21 years of age or older as a covered service for up to $1,000. (Sec. 4)

9. Requires AHCCCS to report by November 1 of each year, rather than in 2016, on the technological feasibility and cost of applying 340B drug pricing to the Governor, Legislature and JLBC. (Sec. 5)

10. Removes the requirement that the Director of AHCCCS:

a. Notify specified elected officials if it is determined that CHIP monies are insufficient;

b. Stop processing new applications until sufficient funds are verified and the Governor consents to application processing to begin again; and

c. Establish, by rule, a grievance and appeal procedure if CHIP is terminated. (Sec. 7, 8)

11. Removes the requirement that AHCCCS provide at least 30 days' advance notice to members and contractors regarding CHIP termination. (Sec. 7)

12. Stipulates that if CHIP FMAP is less than 100%, AHCCCS must notify specified individuals and immediately stop processing new applications. (Sec. 7)

13. Extends the Safety Net Care Pool until December 31, 2020. (Sec. 9)

o Safety Net Care Pool is currently set to repeal on December 31, 2017.

14. Requires AHCCCS to transfer to the counties the portion necessary to comply with the Patient Protection and Affordable Care Act regarding the counties' proportional share of the state's contributions by December 31, 2018. (Sec. 14)

15. Permits AHCCCS to continue the risk contingency rate setting for all managed care organizations at funding levels imposed in 2010 for the contract year beginning October 1, 2017. (Sec. 19)

16. Allows AHCCCS to participate in any Special Disability Workload 1115 Demonstration Waiver offered by CMS. Specifies that any credits must be used in the FY when those credits are made available to fund the state share of any medical assistance expenditures that qualify for federal financial participation.

a. Requires AHCCCS to report the receipt of any credits to JLBC by December 31, 2017 and June 30, 2018. (Sec. 20)

17. Requires AHCCCS to submit reports to the Director of JLBC by January 2, 2018 on the availability of inpatient psychiatric treatment for adults, children and adolescents who receive services from RBHAs, which must include:

a. The number of available inpatient beds and the occupancy rates for those beds;

b. Expenditures on inpatient psychiatric treatment;

c. The total number of individuals who are sent out of state for inpatient psychiatric care; and

d. The prevalence of psychiatric boarding or the holding of psychiatric patients in emergency rooms for at least 24 hours before transferring the patient to a psychiatric facility. (Sec. 22)

18. Requires the report to separately include information for adults, children and adolescents. (Sec. 22)

19. States that it is the intent of the legislature that AHCCCS implement a program within the available appropriation relating to Proposition 204. (Sec. 25)

Arizona Department of Economic Security

20. Prohibits any transferred monies from capitated payments in the ALTCS Fund from being adjusted to pay non-Medicaid claims incurred by DDD. (Sec. 8)

21. Permits ADES to use unexpended and unencumbered monies from capitation payments in the ALTCS Fund for DDD state-only program expenses.

a. Requires ADES to submit an expenditure plan for review to JLBC.

b. Contains a retroactive date of June 30, 2017. (Sec. 18)

Counties

22. Sets the annual county ALTCS contributions for FY 2018 at $264,673,200.

a. Specifies county contributions and requires contributions to be deposited into the ALTCS Fund. (Sec. 10)

23. States that if the overall cost for ALTCS exceeds the amount specified in the FY 2018 General Appropriations Act, the treasurer must collect the difference between outlined county contributions and the counties' share of the state's actual contribution. (Sec. 10)

24. Requires the counties' share of the state's contributions to comply with federal maintenance of effort requirements. (Sec. 10)

25. Requires the Director of AHCCCS to notify the state treasurer of the counties' share of the state's contribution and report the amount to JLBC. (Sec. 10)

26. Specifies that the state treasurer must withhold an amount necessary to fulfill a county's requirement as outlined.

a. Prohibits the state treasurer from withholding distributions from HURF. (Sec. 10)

27. Continues to require counties to reimburse ADHS 31% of the costs for the commitment of a sexually violent person and excludes the county contributions from the county expenditure limitation.

a. Defines cost of commitment. (Sec. 11)

28. Requires ADHS to deposit reimbursements into the ASH Fund. (Sec. 11)

29. Requires counties to make reimbursements within 30 days after a request is made by ADHS. (Sec. 11)

30. Stipulates that if a county fails to reimburse ADHS, the superintendent of ASH must notify the state treasurer and that county's reimbursement amount will be withheld from any TPT that is to be distributed to the county. (Sec. 11)

31. Continues to require a city, town or county to reimburse ADHS for 100% of the costs of inpatient competency restoration treatment.

a. Excludes the county contributions from the county expenditure limitation.

b. Requires monies to be deposited into the ASH Fund. (Sec. 12)

32. Requires each city, town or county to make reimbursements to ADHS within 30 days of a request. (Sec. 12)

33. Stipulates that if a city, town or county fails to reimburse ADHS, the superintendent of ASH must notify the state treasurer and that county's reimbursement amount will be withheld from any TPT that is to be distributed to the county. (Sec. 12)

34. Permits a county to use any source of revenue designated by the county in order meet any statutory funding requirements for ALTCS and ASH Fund payments. (Sec. 11, 12)

35. Sets the annual county acute-care contributions at $46,813,400 for FY 2018 and states it is the intent of the Legislature that the Maricopa County contribution be reduced in each subsequent year according to the changes in the GDP price deflator.

a. Outlines each county's contribution amount.

b. Requires the state treasurer to recover the cost of any funding that was not provided by a county from other funds owed to that county, excluding HURF.

c. Specifies payment processes and requirements. (Sec. 15)

36. Sets the annual amount of TPT revenue to be withheld from the counties, except Maricopa, at $2,646,200 for the county contribution of disproportionate uncompensated care for hospitalization and medical care services administered by AHCCCS.

a. Outlines each county's contribution amount.

b. Specifies payment processes and requirements.

c. Excludes the county contributions from the county expenditure limitation. (Sec. 16)

37. Continues to exclude Proposition 204 administration costs from the county expenditure limitations. (Sec. 17)

ADHS and AHCCCS

38. Requires the Directors of ADHS and AHCCCS to submit a joint report on hospital charge master transparency to the Governor, Legislature and Secretary of State by January 1, 2018. (Sec. 21)

39. Requires the joint report to include:

a. A summary of the current charge master reporting process;

b. A summary of hospital billed charges compared to costs;

c. Examples of how charge masters or hospital prices are reported and used in other states; and

d. Recommendations to improve use of hospital charge master information, including reporting and oversight changes. (Sec. 21)

Hospitals Disproportionate Share (DSH) Payments

40. Sets the annual DSH Payment amount for the District in FY 2018 in the amount of $108,874,800.

a. Requires District to provide a certified public expense form for the amount of qualifying DSH expenditures made to AHCCCS by May 1, 2018 for all state plan years as required by the AHCCCS Section 1115 waiver.

b. States that if the certification is equal to or less than $108,874,800, and AHCCCS determines the revised amount is correct, they must:

i. Notify the Governor and Legislature; and

ii. Distribute $4,202,300 to the District and deposit the federal financial participation balance in the GF.

c. Stipulates that if the certification is for an amount less than $108,874,800 and AHCCCS determines the revised amount is not correct, they must:

i. Notify the Governor and Legislature; and

ii. Deposit the total amount of the federal financial participation in the GF.

d. States that if the certification is for an amount greater than $108,874,800, AHCCCS must distribute $4,202,300 to the District and deposit $71,890,300 of the federal financial participation in the GF.

e. Permits AHCCCS to make additional DSH payments to the District pursuant to statute. (Sec. 13)

41. Sets the annual DSH Payment amount for ASH in FY 2018 in the amount of $28,474,900.

a. Requires ASH to provide a certified public expense form for the amount of qualifying DSH expenditures made on behalf of AZ to AHCCCS by March 1, 2018.

b. Requires AHCCCS to assist ASH in determining the amount of qualifying DSH expenditures.

c. Requires AHCCCS to distribute the entire amount of federal financial participation to the GF.

d. Stipulates that if the certification is less than $28,474,900, AHCCCS must:

i. Notify the Governor and Legislature; and

ii. Distribute the entire amount of federal financial participation in the GF.

e. States that the certified public expense form must contain the total amount of qualifying DSH expenditures and the amount limited by federal law. (Sec. 13)

42. Sets the annual DSH Payment amount for private qualifying DSH hospitals in FY 2018 in the amount of $884,800.

a. Requires AHCCCS to make payments to hospitals consistent with the specified appropriation and the terms of the Section 1115 waiver.

b. Specifies that DSH payments are limited to:

i. Qualifying DSH hospitals as defined by federal law; and

ii. Hospitals which contain at least 300 beds and are located in Yuma County. (Sec. 13)

43. States that after DSH distributions are made, allocations of DSH payments must be made first to qualifying private hospitals located outside of the Phoenix and Tucson statistical metropolitan areas and then to qualifying hospitals within those areas. (Sec. 13)

Miscellaneous

44. Permits Health Services Lottery Fund monies to be used for the purposes specified in the General Appropriations Act. (Sec. 23)

45. Makes technical and conforming changes. (Sec. 3, 4, 7, 8, 9)

Legend (Continued):

ADHS – Arizona Department of Health Services

ADES – Arizona Department of Economic Security

AHCCCS – Arizona Health Care Cost Containment System

ALTCS – Arizona Long-Term Care System

APS – Adult Protective Services

ASH – Arizona State Hospital

CHIP – Children's Health Insurance Program

CMS – Centers for Medicare and Medicaid Services

DDD – Division of Developmental Disabilities

District – Maricopa County Special Health Care District

DSH – Disproportionate Share Payments

FMAP – Federal Medical Assistance Percentage

Fund – Public Health Emergencies Fund

HHS – United States Departmnet of Health and Human Services

HURF – Highway User Revenue Fund

JLBC – Joint Legislative Budget Committee

OSPB – Governor's Office of Strategic Planning and Budgeting

RBHA – Regional Behavioral Health Authority

TPT – Transaction Privilege Tax

Amendments – BOLD and ~~Stricken~~ (Committee)

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