HOUSE BILL No. 4186

 

January 31, 2007, Introduced by Rep. Cushingberry and referred to the Committee on Appropriations.

 

      A bill to amend 1978 PA 368, entitled

 

"Public health code,"

 

by amending section 20161 (MCL 333.20161), as amended by 2005 PA

 

187.

 

THE PEOPLE OF THE STATE OF MICHIGAN ENACT:

 

 1        Sec. 20161. (1) The department shall assess fees and other

 

 2  assessments for health facility and agency licenses and

 

 3  certificates of need on an annual basis as provided in this

 

 4  article. Except as otherwise provided in this article, fees and

 

 5  assessments shall be paid in accordance with the following

 

 6  schedule:

 

 


     (a) Freestanding surgical

outpatient facilities................$238.00 per facility.

     (b) Hospitals...................$8.28 per licensed bed.

     (c) Nursing homes, county

medical care facilities, and

hospital long-term care units........$2.20 per licensed bed.

     (d) Homes for the aged..........$6.27 per licensed bed.

     (e) Clinical laboratories.......$475.00 per laboratory.

     (f) Hospice residences..........$200.00 per license

10                                      survey; and $20.00 per

11                                      licensed bed.

12      (g) Subject to subsection

13 (13), quality assurance assessment

14 for nursing homes and hospital

15 long-term care units.................an amount resulting

16                                      in not more than 6%

17                                      of total industry

18                                      revenues.

19      (h) Subject to subsection

20 (14), quality assurance assessment

21 for hospitals........................at a fixed or variable

22                                      rate that generates

23                                      funds not more than the

24                                      maximum allowable under

25                                      the federal matching

26                                      requirements, after

27                                      consideration for the

28                                      amounts in subsection

29                                      (14)(a) and (i).

 

 

30        (2) If a hospital requests the department to conduct a

 


 1  certification survey for purposes of title XVIII or title XIX of

 

 2  the social security act, the hospital shall pay a license fee

 

 3  surcharge of $23.00 per bed. As used in this subsection, "title

 

 4  XVIII" and "title XIX" mean those terms as defined in section

 

 5  20155.

 

 6        (3) The base fee for a certificate of need is $1,500.00 for

 

 7  each application. For a project requiring a projected capital

 

 8  expenditure of more than $500,000.00 but less than $4,000,000.00,

 

 9  an additional fee of $4,000.00 shall be added to the base fee.

 

10  For a project requiring a projected capital expenditure of

 

11  $4,000,000.00 or more, an additional fee of $7,000.00 shall be

 

12  added to the base fee. The department of community health shall

 

13  use the fees collected under this subsection only to fund the

 

14  certificate of need program. Funds remaining in the certificate

 

15  of need program at the end of the fiscal year shall not lapse to

 

16  the general fund but shall remain available to fund the

 

17  certificate of need program in subsequent years.

 

18        (4) If licensure is for more than 1 year, the fees described

 

19  in subsection (1) are multiplied by the number of years for which

 

20  the license is issued, and the total amount of the fees shall be

 

21  collected in the year in which the license is issued.

 

22        (5) Fees described in this section are payable to the

 

23  department at the time an application for a license, permit, or

 

24  certificate is submitted. If an application for a license,

 

25  permit, or certificate is denied or if a license, permit, or

 

26  certificate is revoked before its expiration date, the department

 

27  shall not refund fees paid to the department.

 


 1        (6) The fee for a provisional license or temporary permit is

 

 2  the same as for a license. A license may be issued at the

 

 3  expiration date of a temporary permit without an additional fee

 

 4  for the balance of the period for which the fee was paid if the

 

 5  requirements for licensure are met.

 

 6        (7) The department may charge a fee to recover the cost of

 

 7  purchase or production and distribution of proficiency evaluation

 

 8  samples that are supplied to clinical laboratories pursuant to

 

 9  section 20521(3).

 

10        (8) In addition to the fees imposed under subsection (1), a

 

11  clinical laboratory shall submit a fee of $25.00 to the

 

12  department for each reissuance during the licensure period of the

 

13  clinical laboratory's license.

 

14        (9) The cost of licensure activities shall be supported by

 

15  license fees.

 

16        (10) The application fee for a waiver under section 21564 is

 

17  $200.00 plus $40.00 per hour for the professional services and

 

18  travel expenses directly related to processing the application.

 

19  The travel expenses shall be calculated in accordance with the

 

20  state standardized travel regulations of the department of

 

21  management and budget in effect at the time of the travel.

 

22        (11) An applicant for licensure or renewal of licensure

 

23  under part 209 shall pay the applicable fees set forth in part

 

24  209.

 

25        (12) Except as otherwise provided in this section, the fees

 

26  and assessments collected under this section shall be deposited

 

27  in the state treasury, to the credit of the general fund.

 


 1        (13) The quality assurance assessment collected under

 

 2  subsection (1)(g) and all federal matching funds attributed to

 

 3  that assessment shall be used only for the following purposes and

 

 4  under the following specific circumstances:

 

 5        (a) The quality assurance assessment and all federal

 

 6  matching funds attributed to that assessment shall be used to

 

 7  finance medicaid nursing home reimbursement payments. Only

 

 8  licensed nursing homes and hospital long-term care units that are

 

 9  assessed the quality assurance assessment and participate in the

 

10  medicaid program are eligible for increased per diem medicaid

 

11  reimbursement rates under this subdivision.

 

12        (b) Except as otherwise provided under subdivision (c),

 

13  beginning October 1, 2005, the quality assurance assessment is

 

14  based on the total number of patient days of care each nursing

 

15  home and hospital long-term care unit provided to nonmedicare

 

16  patients within the immediately preceding year and shall be

 

17  assessed at a uniform rate on October 1, 2005 and subsequently on

 

18  October 1 of each following year, and is payable on a quarterly

 

19  basis, the first payment due 90 days after the date the

 

20  assessment is assessed.

 

21        (c) Within 30 days after the effective date of the

 

22  amendatory act that added this subdivision September 30, 2005,

 

23  the department shall submit an application to the federal centers

 

24  for medicare and medicaid services to request a waiver pursuant

 

25  to 42 CFR 433.68(e) to implement this subdivision as follows:

 

26        (i) If the waiver is approved, the quality assurance

 

27  assessment rate for a nursing home or hospital long-term care

 


 1  unit with less than 40 licensed beds or with the maximum number,

 

 2  or more than the maximum number, of licensed beds necessary to

 

 3  secure federal approval of the application is $2.00 per

 

 4  nonmedicare patient day of care provided within the immediately

 

 5  preceding year or a rate as otherwise altered on the application

 

 6  for the waiver to obtain federal approval. If the waiver is

 

 7  approved, for all other nursing homes and long-term care units

 

 8  the quality assurance assessment rate is to be calculated by

 

 9  dividing the total statewide maximum allowable assessment

 

10  permitted under subsection (1)(g) less the total amount to be

 

11  paid by the nursing homes and long-term care units with less than

 

12  40 or with the maximum number, or more than the maximum number,

 

13  of licensed beds necessary to secure federal approval of the

 

14  application by the total number of nonmedicare patient days of

 

15  care provided within the immediately preceding year by those

 

16  nursing homes and long-term care units with more than 39, but

 

17  less than the maximum number of licensed beds necessary to secure

 

18  federal approval. The quality assurance assessment, as provided

 

19  under this subparagraph, shall be assessed in the first quarter

 

20  after federal approval of the waiver and shall be subsequently

 

21  assessed on October 1 of each following year, and is payable on a

 

22  quarterly basis, the first payment due 90 days after the date the

 

23  assessment is assessed.

 

24        (ii) If the waiver is approved, continuing care retirement

 

25  centers are exempt from the quality assurance assessment if the

 

26  continuing care retirement center requires each center resident

 

27  to provide an initial life interest payment of $150,000.00, on

 


 1  average, per resident to ensure payment for that resident's

 

 2  residency and services and the continuing care retirement center

 

 3  utilizes all of the initial life interest payment before the

 

 4  resident becomes eligible for medical assistance under the

 

 5  state's medicaid plan. As used in this subparagraph, "continuing

 

 6  care retirement center" means a nursing care facility that

 

 7  provides independent living services, assisted living services,

 

 8  and nursing care and medical treatment services, in a campus-like

 

 9  setting that has shared facilities or common areas, or both.

 

10        (d) Beginning October 1, 2007, the department shall no

 

11  longer assess or collect the quality assurance assessment or

 

12  apply for federal matching funds.

 

13        (e) Beginning May 10, 2002, the department of community

 

14  health shall increase the per diem nursing home medicaid

 

15  reimbursement rates for the balance of that year. For each

 

16  subsequent year in which the quality assurance assessment is

 

17  assessed and collected, the department of community health shall

 

18  maintain the medicaid nursing home reimbursement payment increase

 

19  financed by the quality assurance assessment.

 

20        (f) The department of community health shall implement this

 

21  section in a manner that complies with federal requirements

 

22  necessary to assure that the quality assurance assessment

 

23  qualifies for federal matching funds.

 

24        (g) If a nursing home or a hospital long-term care unit

 

25  fails to pay the assessment required by subsection (1)(g), the

 

26  department of community health may assess the nursing home or

 

27  hospital long-term care unit a penalty of 5% of the assessment

 


 1  for each month that the assessment and penalty are not paid up to

 

 2  a maximum of 50% of the assessment. The department of community

 

 3  health may also refer for collection to the department of

 

 4  treasury past due amounts consistent with section 13 of 1941 PA

 

 5  122, MCL 205.13.

 

 6        (h) The medicaid nursing home quality assurance assessment

 

 7  fund is established in the state treasury. The department of

 

 8  community health shall deposit the revenue raised through the

 

 9  quality assurance assessment with the state treasurer for deposit

 

10  in the medicaid nursing home quality assurance assessment fund.

 

11        (i) The department of community health shall not implement

 

12  this subsection in a manner that conflicts with 42 USC 1396b(w).

 

13        (j) The quality assurance assessment collected under

 

14  subsection (1)(g) shall be prorated on a quarterly basis for any

 

15  licensed beds added to or subtracted from a nursing home or

 

16  hospital long-term care unit since the immediately preceding July

 

17  1. Any adjustments in payments are due on the next quarterly

 

18  installment due date.

 

19        (k) In each fiscal year governed by this subsection,

 

20  medicaid reimbursement rates shall not be reduced below the

 

21  medicaid reimbursement rates in effect on April 1, 2002 as a

 

22  direct result of the quality assurance assessment collected under

 

23  subsection (1)(g).

 

24        (l) In fiscal year 2005-2006, $39,900,000.00 of the quality

 

25  assurance assessment collected pursuant to subsection (1)(g)

 

26  shall be appropriated to the department of community health to

 

27  support medicaid expenditures for long-term care services. These

 


 1  funds shall offset an identical amount of general fund/general

 

 2  purpose revenue originally appropriated for that purpose.

 

 3        (14) The quality assurance dedication is an earmarked

 

 4  assessment collected under subsection (1)(h). That assessment and

 

 5  all federal matching funds attributed to that assessment shall be

 

 6  used only for the following purpose and under the following

 

 7  specific circumstances:

 

 8        (a) To maintain the increased medicaid reimbursement rate

 

 9  increases as provided for in subdivision (c).

 

10        (b) The quality assurance assessment shall be assessed on

 

11  all net patient revenue, before deduction of expenses, less

 

12  medicare net revenue, as reported in the most recently available

 

13  medicare cost report and is payable on a quarterly basis, the

 

14  first payment due 90 days after the date the assessment is

 

15  assessed. As used in this subdivision, "medicare net revenue"

 

16  includes medicare payments and amounts collected for coinsurance

 

17  and deductibles.

 

18        (c) Beginning October 1, 2002, the department of community

 

19  health shall increase the hospital medicaid reimbursement rates

 

20  for the balance of that year. For each subsequent year in which

 

21  the quality assurance assessment is assessed and collected, the

 

22  department of community health shall maintain the hospital

 

23  medicaid reimbursement rate increase financed by the quality

 

24  assurance assessments.

 

25        (d) The department of community health shall implement this

 

26  section in a manner that complies with federal requirements

 

27  necessary to assure that the quality assurance assessment

 


 1  qualifies for federal matching funds.

 

 2        (e) If a hospital fails to pay the assessment required by

 

 3  subsection (1)(h), the department of community health may assess

 

 4  the hospital a penalty of 5% of the assessment for each month

 

 5  that the assessment and penalty are not paid up to a maximum of

 

 6  50% of the assessment. The department of community health may

 

 7  also refer for collection to the department of treasury past due

 

 8  amounts consistent with section 13 of 1941 PA 122, MCL 205.13.

 

 9        (f) The hospital quality assurance assessment fund is

 

10  established in the state treasury. The department of community

 

11  health shall deposit the revenue raised through the quality

 

12  assurance assessment with the state treasurer for deposit in the

 

13  hospital quality assurance assessment fund.

 

14        (g) In each fiscal year governed by this subsection, the

 

15  quality assurance assessment shall only be collected and expended

 

16  if medicaid hospital inpatient DRG and outpatient reimbursement

 

17  rates and disproportionate share hospital and graduate medical

 

18  education payments are not below the level of rates and payments

 

19  in effect on April 1, 2002 as a direct result of the quality

 

20  assurance assessment collected under subsection (1)(h), except as

 

21  provided in subdivision (h).

 

22        (h) The quality assurance assessment collected under

 

23  subsection (1)(h) shall no longer be assessed or collected after

 

24  September 30, 2008, or in the event that the quality assurance

 

25  assessment is not eligible for federal matching funds. Any

 

26  portion of the quality assurance assessment collected from a

 

27  hospital that is not eligible for federal matching funds shall be

 


 1  returned to the hospital.

 

 2        (i) In each fiscal year, 2005-2006, $42,400,000.00 of the

 

 3  quality assurance assessment collected pursuant to subsection

 

 4  (1)(h) shall be appropriated to the department of community

 

 5  health to support medicaid expenditures for hospital services and

 

 6  therapy. These funds shall offset an identical amount of general

 

 7  fund/general purpose revenue originally appropriated for that

 

 8  purpose.

 

 9        (15) The quality assurance assessment provided for under

 

10  this section is a tax that is levied on a health facility or

 

11  agency.

 

12        (16) As used in this section, "medicaid" means that term as

 

13  defined in section 22207.