§ 40-26B-71 — Assessment

Alabama § 40-26B-71

• Jurisdiction: Alabama
• Title 40: Revenue and Taxation
• Ch. 26B: Providers of Medical Services Privilege Tax
• Art. 5: Hospital Funding Program

Text

(a) For state fiscal years 2026, 2027, and 2028, an assessment is imposed on each privately operated hospital in the amount of 6.00 percent of net patient revenue in fiscal year 2023, which shall be reviewed and hospital cost reports updated annually, subject to limitations in this article on the use of funds in the Hospital Assessment Account. The assessment is a cost of doing business as a privately operated hospital in the State of Alabama. Annually, the Medicaid Agency shall make a determination of whether changes in federal law or regulation have adversely affected hospital Medicaid reimbursement during the most recently completed fiscal year, or a reduction in payment rates has occurred. If the agency determines that adverse impact to hospital Medicaid reimbursement has occurred, or will occur, the agency shall report its findings to the Chair of the House Ways and Means General Fund Committee who shall propose an amendment to this article during any legislative session prior to the start of the upcoming fiscal year from the year the report was made, to address the adverse impact. The assessment imposed on each private hospital under this section shall be reduced pro rata, if the total disproportionate share allotment for all hospitals is reduced before or during the 2028 fiscal year, as a result of any action by the Medicaid Agency or the Centers for Medicare and Medicaid Services, and only to the extent that the Hospital Assessment Account is more than necessary to fund some or all hospital payments under this article.
(b)(1) For state fiscal years 2026, 2027, and 2028, net patient revenue shall be determined using the data from each private hospital’s fiscal year ending 2023, 2024, or 2025 Medicare Cost Report contained in the Centers for Medicare and Medicaid Services’ Healthcare Cost Report Information System, which shall be reviewed and the hospital cost reports updated annually subject to limitations in this article on the use of funds in the Hospital Assessment Account. The Medicare Cost Report for 2023, 2024, and 2025 for each private hospital, which shall be reviewed and updated annually, shall be used for fiscal years 2026, 2027, and 2028, respectively. If the Medicare Cost Report is not available in the Centers for Medicare and Medicaid Services’ Healthcare Cost Report Information System, the hospital shall submit a copy to the department to determine the hospital’s net patient revenue for the most recent fiscal year.
(2) If a privately operated hospital commenced operations after the due date for a 2023 Medicare Cost Report, the hospital shall submit its most recent Medicare Cost Report to the department in order to allow the department to determine the hospital’s net patient revenue.
(c) This article does not authorize a unit of county or local government to license for revenue or impose a tax or assessment upon hospitals or a tax or assessment measured by the income or earnings of a hospital.

Legislative History

(Act 2009-549, p. 1454, §2; Act 2011-615, p. 1383, §1; Act 2013-246, p. 595, §1; Act 2016-299, p. 749, §1; Act 2017-382, p. 1224, §1; Act 2018-543, §1; Act 2019-278, §1; Act 2022-127, §1; Act 2025-371, §1.)