§ 2807-A — General hospital nineteen hundred eighty-six and nineteen hundred eighty-seven inpatient rates and charges

New York § 2807-A

• Jurisdiction: New York
• Law PBH: Public Health
• Art. 28: Hospitals

Text

§ 2807-a. General hospital nineteen hundred eighty-six and nineteen\nhundred eighty-seven inpatient rates and charges.\n 1. For the rate period from January first, nineteen hundred eighty-six\nthrough December thirty-first, nineteen hundred eighty-six and for the\nrate period from January first, nineteen hundred eighty-seven through\nDecember thirty-first, nineteen hundred eighty-seven, the rates of\npayment to general hospitals for services provided to persons eligible\nfor payments made by state governmental agencies and subscribers to\narticle forty-three insurance law corporations and subscribers of\norganizations organized under article forty-four of this chapter (unless\napplication is made to the commissioner under subdivision three of this\nsection) shall be based on the reimbursable operating costs used in\ndetermining payments for services provided during the rate period from\nJanuary first, nineteen hundred eighty-five through December\nthirty-first, nineteen hundred eighty-five. Such operating costs shall\ninclude the annualized cost impact of rate revisions or adjustments made\nwith respect to such services. In addition to the reimbursable operating\ncosts identified in accordance with this subdivision, payment rates by\ngovernmental agencies and article forty-three insurance law corporations\nshall be adjusted each year to reflect:\n (a) capital related expenses determined in accordance with subdivision\nseven of this section;\n (b) additional financial needs or revenue requirements in accordance\nwith subdivision eight of this section; and\n (c) projection of reimbursable costs identified in accordance with\nthis subdivision by a trend factor established by the panel of\neconomists as set forth in subdivision fourteen of this section.\n 2. For the rate period from January first, nineteen hundred\neighty-six through December thirty-first, nineteen hundred eighty-six\nand for the rate period from January first, nineteen hundred\neighty-seven through December thirty-first, nineteen hundred\neighty-seven, rates of payment pursuant to the provisions of the\nworkers' compensation law, the volunteer firefighters' benefit law and\nthe comprehensive motor vehicle insurance reparations act shall be\nestablished on the basis of one hundred twelve percent of the trended\nnineteen hundred eighty-one average operating reimbursable per diem\ninpatient cost of the hospital, plus the additions specified in\nsubdivisions seven and eight of this section and such revisions that may\nbe made pursuant to subdivisions eleven and fourteen of this section.\n 3. Nothing in this section shall prohibit the negotiation by health\nmaintenance organizations operating in accordance with the provisions of\narticle forty-three of the insurance law or article forty-four of this\nchapter, of agreements with general hospitals for rates of payment other\nthan those provided herein. Such contracts shall require approval by the\ncommissioner and must include provision for special benefit packages or\narrangements for providing inpatient services to encourage patient\nmanagement behavior that will minimize the length of patient stay, such\nas special admission arrangements, bed leasing or other inpatient\ncapitation arrangements.\n 4. Hospital inpatient services reimbursement provided to patients who\nare not beneficiaries or subscribers of corporations organized and\noperating in accordance with article forty-three of the insurance law,\neligible for payments made by state governmental agencies, eligible for\npayments as beneficiaries of subchapter XVIII of the federal social\nsecurity act, enrolled in organizations operating in accordance with the\nprovisions of article forty-four of this chapter, enrolled in a\nself-insured and self-administered group covered under the provisions of\nparagraph (b) of subdivision twelve of this section, or eligible for\npayments pursuant to the provisions of the workers' compensation law,\nthe volunteer firefighters' benefit law or the comprehensive motor\nvehicle insurance reparations act shall be at charges established by the\nhospital in accordance with subdivision twelve of this section.\n 5. Specialty hospitals shall receive reimbursement for general\nhospital inpatient services in accordance with the provisions of this\nsection unless other reimbursement methodologies are adopted by the\ncouncil and approved by the commissioner. In such event the allowances\nprovided in subdivision eight of this section shall be included in\ncertified and approved inpatient rates.\n 6. The establishment of separate rates of payment for patients who\nrequire different levels or types of care shall require a reallocation\nof costs to insure that costs are equitably allocated to service areas\nand appropriate rate adjustments are made.\n 7. Capital related expenses. Capital related inpatient expenses,\nincluding but not limited to straight line depreciation on buildings and\nnon-movable equipment, accelerated depreciation on movable equipment if\nrequested by the hospital, rentals and interest on capital debt (or for\nhospitals financed pursuant to article twenty-eight-b of this chapter,\nsuch expenses, including amortization in lieu of depreciation, as\ndetermined pursuant to the reimbursement regulations promulgated\npursuant to that article and article twenty-eight of this chapter),\nshall be included in rates established on a budget basis and\nsubsequently reconciled to actual expenses through appropriate audit\nprocedures. General hospitals shall submit to the commissioner, at least\none hundred twenty days prior to the commencement of each year, a\nschedule of capital related inpatient expenses for the forthcoming year.\nAny capital related inpatient expense generated by a capital expenditure\nwhich requires or required approval pursuant to this article, must have\nreceived such approval for the capital related expense to be included in\nthe rates established. The submitted budget may include the capital\nrelated inpatient expenses for all existing capital assets as well as\nestimates of capital related inpatient expenses for capital assets to be\nacquired or placed in use prior to the commencement of the rate year or\nduring the rate year provided all required approvals have been obtained.\nThe basis for determining capital related inpatient expenses shall be\nthe lesser of actual cost or the final amount specifically approved for\nthe construction of the capital asset. The council shall adopt, with the\napproval of the commissioner, regulations to:\n (a) identify by type the eligible capital related inpatient expenses;\n (b) safeguard the future financial viability of voluntary, non-profit\ngeneral hospitals by requiring funding of inpatient depreciation on\nbuilding and fixed and movable equipment;\n (c) provide authorization to adjust inpatient rates by advancing\npayment of depreciation as needed, in instances of capital debt related\nfinancial distress of a voluntary, non-profit general hospital; and\n (d) provide a methodology for the reimbursement treatment of sales.\n 8. Allowances. All rates established for the two years commencing on\nJanuary first, nineteen hundred eighty-six in accordance with\nsubdivisions one, two, three, four, five and six of this section shall\ninclude the allowances specified in paragraphs (a), (b), (c), (e) and\n(f) of this subdivision. The allowances shall be computed on the basis\nof the general hospitals' reimbursable inpatient costs after application\nof the trend factor. For the purposes of this subdivision and\nsubdivisions sixteen and twenty-four of this section, major public\ngeneral hospitals are defined as all state operated general hospitals,\nall general hospitals operated by the New York city health and hospitals\ncorporation as established by chapter one thousand sixteen of the laws\nof nineteen hundred sixty-nine as amended and all other public general\nhospitals having annual inpatient operating costs in excess of\ntwenty-five million dollars.\n (a) An allowance of one percent of the general hospitals' reimbursable\ninpatient costs computed in accordance with this section to be used at\nthe discretion of hospital governing boards.\n (b) For public general hospitals an additional allowance of up to two\npercent subject to the provisions of paragraph (d) of this subdivision.\n (c) For voluntary non-profit and private proprietary general hospitals\nan additional allowance up to one percent subject to the provisions of\nparagraph (d) of this subdivision.\n (d) The additional allowances in paragraphs (b) and (c) of this\nsubdivision shall be available to general hospitals receiving approval\nfrom the commissioner as to the acceptable use of the allowance which\nuses shall include but not be limited to retirement of short term\nnon-capital debt, meeting costs related to bad debts and charity care\nnot met by the distributions as specified in subdivisions sixteen and\ntwenty-four of this section, offsetting reductions in anticipated\nrevenue resulting from charge limits below those applicable to the\nparticular hospital immediately prior to the enactment of subdivision\ntwelve of this section, and needed improvement of current ratio.\nAllowances authorized by paragraphs (b) and (c) of this subdivision are\nnot to be considered as a substitute for operational funds that are\notherwise reimbursable or subject to appeal.\n (e) A percentage to reflect the needs for the financing of losses\nresulting from bad debts and the costs of charity care of general\nhospitals within article forty-three insurance law regions, or such\nother regions as adopted pursuant to subdivision fifteen of this\nsection, and within a statewide determination of financial resources to\nbe committed for this purpose. Regional needs shall be equal to the\ntotal of inpatient losses from bad debts reduced to cost and the\ninpatient costs of charity care increased by any deficit of such\nhospitals from providing ambulatory services, excluding any portion of\nsuch deficit resulting from governmental payments below average visit\ncosts, and revenues and expenses related to the provision of referred\nambulatory services. The regional amounts to be included in rates\napproved for the rate year commencing January first, nineteen hundred\neighty-six and for the rate year commencing January first, nineteen\nhundred eighty-seven will be equal to the result of the application of\nthe percentage of statewide need for voluntary non-profit, private\nproprietary and public general hospitals, other than major public\ngeneral hospitals, that can be met from available resources in regional\npools, created in accordance with subdivision fifteen of this section\ncomputed without consideration of inpatient uncollectible amounts, to\nthe regional need for voluntary non-profit, private proprietary and\npublic general hospitals, other than major public general hospitals,\nexpressed in dollars plus the dollar amount resulting from the\napplication of the ratio of major public general hospitals inpatient\nreimbursable costs within the region to total statewide general\ninpatient reimbursable cost (as computed on the basis of nineteen\nhundred eighty-four financial and statistical reports and excluding\ncosts related to services to beneficiaries of subchapter XVIII of the\nfederal social security act) to the statewide resources committed for\nthis purpose to regional pools computed without consideration of\ninpatient uncollectible amounts and the ratio of these total dollars to\nthe total regional reimbursable inpatient costs, excluding inpatient\ncosts related to services provided to beneficiaries of subchapter XVIII\nof the federal social security act, after application of the trend\nfactor. For each year of the two year period commencing on January\nfirst, nineteen hundred eighty-six the statewide amount to be available\nin regional pools for this purpose will equal four and one-half percent\nof the total hospital reimbursable inpatient cost, excluding inpatient\ncosts related to services provided to beneficiaries of subchapter XVIII\nof the federal social security act and inpatient uncollectible amounts,\nafter application of the trend factor. The allocations of resources made\navailable under this paragraph, as specified in subdivision sixteen of\nthis section may be changed only as follows: An annual review shall be\nconducted pursuant to rules and regulations adopted by the council and\napproved by the commissioner with respect to bad debt and charity care\nneed within each article forty-three insurance law region or such other\nregions as are adopted pursuant to subdivision fifteen of this section.\nIf within such a region there is a definitive finding as a result of\nsuch review that there has been a change in the proportional amounts of\nbad debts and charity care provided by (i) major public general\nhospitals and (ii) voluntary non-profit, private proprietary and public\ngeneral hospitals, other than major public general hospitals, the\nallocation of resources made available under this paragraph shall be\nadjusted pursuant to the rules and regulations adopted pursuant to this\nparagraph so as to reflect this change.\n (f) An additional allowance of fifty-eight hundredths of one percent\nshall be included in each rate established for each voluntary non-profit\nand private proprietary general hospital to be returned to a regional\npool and distributed in accordance with paragraph (b) of subdivision\nsixteen of this section.\n 10. Special provisions for payments by governmental agencies. In the\nevent that the allowances specified in subdivision eight of this section\nare not approved by the federal government for federal financial\nparticipation in payments made for beneficiaries eligible for medical\nassistance under subchapter XIX of the federal social security act,\nrates of payment by governmental agencies for the operating cost\ncomponent of general hospital inpatient services shall be based on the\nreimbursable operating costs used in determining payments for services\nprovided during the rate period from January first, nineteen hundred\neighty-five through December thirty-first, nineteen hundred eighty-five,\nincluding the annualized cost impact of rate revisions or adjustments\nmade with respect to such services, projected by a trend factor\ndetermined in accordance with subdivision fourteen of this section, and\nadjusted by a base period adjustment factor to reflect the difference\nbetween the actual regional increase in inpatient general hospital\noperating cost for those regions as established pursuant to subdivision\nfifteen of this section between cost reporting periods for nineteen\nhundred eighty-one and nineteen hundred eighty-four and the trend\nfactors developed to project costs for such period, provided, however,\nsuch base period adjustment factor shall not exceed an amount equal to\nthe percentage allowances calculated in accordance with paragraphs (a),\n(b), (c), (e) and (f) of subdivision eight of this section. The\ncommissioner shall assess all general hospitals within a region an\namount equal to the regional allowance percentage as determined in\naccordance with paragraph (e) of subdivision eight of this section\napplied to actual inpatient revenues received from providing inpatient\nservices to persons eligible for payments from state governmental\nagencies excluding inpatient revenues related to services provided to\nbeneficiaries of subchapter XVIII of the federal social security act.\nThe commissioner shall also assess an additional fifty-eight hundredths\nof one percent of actual inpatient revenues received by voluntary\nnon-profit and private proprietary general hospitals for services\nprovided to persons eligible for payments made by state governmental\nagencies excluding inpatient revenues related to services provided to\nbeneficiaries of subchapter XVIII of the federal social security act.\nSuch assessments shall be returned to regional pools in accordance with\nthe methodology contained in subdivision fifteen of this section and\ndistributed in accordance with the provisions of subdivision sixteen of\nthis section.\n 11. Adjustments. (a) For the period from January first, nineteen\nhundred eighty-six through December thirty-first, nineteen hundred\neighty-seven, the commissioner shall on his own initiative, or on the\nbasis of a request from a general hospital, adjust an established rate\nto reflect:\n (i) the reduction of costs related to the elimination of a general\nhospital inpatient service in instances where the costs of such service\nwere included in the rate established; and\n (ii) the correction of errors or omissions of data or in computation.\n (b) General hospitals may request and the commissioner shall consider\nan adjustment to an established rate to reflect increased expenses or\nreconsideration of disallowed expenses based on:\n (i) justification of all or a portion of expenses not included in the\nrate resulting from the cost analysis process contained in subparagraph\n(i) of paragraph (a) of this subdivision;\n (ii) additional operational expenses related to approved construction\nor service changes;\n (iii) the addition of costs related to a state requirement for\nadditional services to be provided or additional costs to be incurred in\nmeeting state and federal requirements;\n (iv) additional expenses to permit a more efficient and economical\nmethod of delivering a service; and\n (v) increased costs for compensation of employees.\n (c) In determining the reasonableness or justification of an\nadjustment to an established rate related to subparagraph (v) of\nparagraph (b) of this subdivision, the commissioner shall consider:\n (i) the fiscal capability of the general hospital to finance such\nincreases from its own resources;\n (ii) the past history of the general hospital with respect to\ncompensation increases and allowed compensation trend factors; and\n (iii) the economy in the area in which the general hospital is\nlocated.\n (d) The commissioner shall adjust a prospectively established\ninpatient rate on the basis of subsequent data that demonstrates a\nsignificant cost influencing change in patient mix or volume of service.\nSuch adjustments shall be based on rules and regulations adopted by the\ncouncil and approved by the commissioner. Such rules and regulations for\na volume adjustment shall take into consideration only volume changes to\nother than beneficiaries of subchapter XVIII of the federal social\nsecurity act.\n (e) All appeals shall be submitted to the commissioner, who may submit\na copy of the appeal to interested parties for the purpose of providing\nan opportunity for comment within a specified time period.\n (f) The commissioner shall act upon all properly documented appeals\nfor adjustments concerning base year costs by November first of the\ncalendar year for which the rate is effective provided that all\ninformation necessary to determine whether an adjustment is justified is\nsubmitted by the facility prior to May first of such year. In the event\nsuch an appeal is filed by May first, but information necessary to\ndetermine whether an adjustment is justified is submitted after such\ndate, the commissioner shall act on the appeal within six months after\nreceiving the necessary information.\n (g) The commissioner shall consider an adjustment to a hospital's\nreported base year costs in instances where it is demonstrated that\nrecurring costs resulting from multi-year commitments beginning late in\na base year should be calculated on an annual basis in establishing a\nrate in order to avoid a significant inequity. In making such an\nadjustment the commissioner shall consider the offset of non-recurring\nbase year costs.\n 12. Hospital charge schedules. (a) Effective for the year commencing\nJanuary first, nineteen hundred eighty-six and thereafter each general\nhospital shall establish a charge schedule for available and authorized\nservices in accordance with a gross charge determination formula\nprovided by the commissioner which shall establish gross inpatient\ncharges such that the payment rate to be made on behalf of subscribers\nof article forty-three insurance law plans, adjusted for uncovered\nservices shall be at a discount which shall not exceed twelve percent of\nthe gross charge rate billed to or on behalf of charge paying patients.\nFor general hospitals subject to the provisions of paragraphs (a) and\n(b) of subdivision twenty-one of this section, the costs (including all\nallowances specified in subdivision eight of this section) of services\nprovided to charge paying patients shall not exceed a twelve percent\ndiscount from the gross charge rate billed to or on behalf of charge\npaying patients. In the event that a hospital's gross inpatient charges\nexceed the maximum inpatient charges computed in accordance with the\ngross charge determination formula prescribed by the commissioner,\ndirect repayment or adjustment of subsequent charges for inpatient\nservices shall be effectuated in accordance with regulations adopted by\nthe council and approved by the commissioner.\n (b) For the period January first, nineteen hundred eighty-six through\nDecember thirty-first, nineteen hundred eighty-seven, negotiated payment\nrate determination systems between self-insured and self-administered\ngroups and hospitals which were in effect on May first, nineteen hundred\neighty-five may continue.\n 13. Working capital. General hospitals may include as a financing or\nworking capital charge an addition of two percent of any valid claim not\npaid within thirty days of submission or determination of payor\nliability, whichever is later, and one percent per month thereafter.\nRevenues received from such financing or working capital charges shall\nnot be considered as a cost offset or as part of the hospital's gross\ninpatient charges. Financing or working capital charges shall not be\napplied to hospital billings to third party payors participating in a\nperiodic interim payment system.\n 14. Trend factors. (a) The commissioner in accordance with the\nmethodology developed by the consultants pursuant to paragraph (b) of\nthis subdivision shall establish trend factors to project for the\neffects of inflation. The factors shall be applied to the appropriate\nportion of reimbursable costs as defined in subdivision one of this\nsection, or, if effective, subdivision ten of this section. The\nmethodology for developing the trend factor shall include the\nappropriate external price indicators and shall also include the data\nfrom major collective bargaining agreements as reported quarterly by the\nfederal department of labor, bureau of labor statistics, for\nnon-supervisory employees.\n (b) The methodology shall be developed by four independent consultants\nwith expertise in health economics appointed by the commissioner. Not\nlater than September first of each year, the consultants shall provide\nto the commissioner and the council, the methodology to be used to\ndetermine the trend factors for the subsequent twelve month period\ncommencing January first. The commissioner shall monitor the actual\nprice movement during this twelve month period of the external price\nindicators used in the methodology, shall report the results of the\nmonitoring to the consultants, and shall implement, semi-annually, the\nrecommendations of the consultants for adjustments to the trend factor,\nprovided, however, that adjustments, except for the final adjustment of\nthe trend factor, shall not be required unless such adjustment would\nresult in the weighted average of the operating cost component of the\nrates differing by more than one-half of one percent from that which was\npreviously determined.\n 15. Regional and statewide pools, general. Funds will be made\navailable in regional pools for regional distributions through the\nsubmissions by general hospitals of the allowances included in rates and\ncharges in accordance with paragraphs (e) and (f) of subdivision eight\nof this section and, if effective, the amount of the assessment in\naccordance with subdivision ten of this section. Funds will be made\navailable for distribution from a statewide pool in accordance with the\nassessments authorized in subdivision twenty-three of this section. The\nregions are established as the article forty-three insurance plan\nregions, with the exception that the southern sixteen counties shall be\ndivided into three regions for the purposes of subdivisions eight and\nsixteen of this section with separate regions consisting of Richmond,\nManhattan, Bronx, Queens and Kings counties; Nassau and Suffolk\ncounties, and Delaware, Columbia, Ulster, Sullivan, Orange, Dutchess,\nPutnam, Rockland and Westchester counties. Such regions shall be the\nsame regions established and in effect January first, nineteen hundred\neighty-five. The council with the approval of the commissioner may\ncombine regions, with the exception of the above specified regions for\nthe southern sixteen counties, upon application of the article\nforty-three insurance law plans involved and a demonstration that\nsignificant inequities would not occur. The commissioner is authorized\nto contract with the article forty-three insurance law plans to receive\nfunds for the pools and distribute such funds. In the event contracts\nwith the article forty-three insurance law plans are effectuated, the\ncommissioner shall conduct annual audits of the receipt and distribution\nof the pooled funds. In order for general hospitals to participate in\nthe distribution of funds from the pools the general hospital must\nimplement collection policies and procedures approved by the\ncommissioner.\n 16. Regional pools. Funds accumulated in regional pools, including\nincome from invested funds, shall be distributed in accordance with the\nfollowing methodology and sequence:\n (a) Funds accumulated in regional pools, including income from\ninvested funds, from the allowance specified in paragraph (e) of\nsubdivision eight of this section and, if effective, the assessment\nagainst all general hospitals as authorized in subdivision ten of this\nsection shall be distributed as follows:\n (i) Each eligible major public general hospital as defined in\nsubdivision eight of this section shall receive a portion of its bad\ndebt and charity care need equal to the result of the application of\nits percentage of statewide inpatient reimbursable costs excluding costs\nrelated to services to beneficiaries of subchapter XVIII of the federal\nsocial security act, developed on the basis of nineteen hundred\neighty-four financial and statistical reports to the total of all\nregional pools.\n (ii) Funds remaining in the regional pools after distribution in\naccordance with subparagraph (i) of this paragraph shall be distributed\nproportionately to voluntary non-profit, private proprietary and public\ngeneral hospitals, other than major public general hospitals, on the\nbasis of need within the region as defined in paragraph (e) of\nsubdivision eight of this section.\n (b) Funds accumulated in regional pools, including income from\ninvested funds, created by the allowance specified in paragraph (f) of\nsubdivision eight of this section and, if effective, the fifty-eight\nhundredths of one percent assessment against voluntary non-profit and\nprivate proprietary general hospitals as authorized by subdivision ten\nof this section, shall be available for distribution by the commissioner\nin accordance with rules adopted by the council to assist in offsetting\nlosses resulting from bad debts and the costs of charity care of\nvoluntary non-profit and private proprietary general hospitals\nexperiencing severe fiscal hardship because of insufficient resources to\nfinance such losses and costs. Such losses and costs may include losses\nand costs incurred prior to the year used in determining hospital need\npursuant to paragraph (e) of subdivision eight of this section. Amounts\nto be distributed shall be determined after consideration of amounts to\nbe distributed from regional pools in accordance with paragraph (a) of\nthis subdivision and from the statewide pool in accordance with\nsubparagraph (iii) of paragraph (a) of subdivision twenty-four of this\nsection.\n (c) Any balance in the portion of regional pools created by the\nallowance in paragraph (f) of subdivision eight of this section, and if\neffective, the fifty-eight hundredths of one percent assessment as\nauthorized by subdivision ten of this section, including income from\ninvested funds, after distribution in accordance with paragraph (b) of\nthis subdivision shall be distributed to voluntary non-profit and\nprivate proprietary general hospitals within the region on a basis\nrelated to specific hospital need as defined in paragraph (e) of\nsubdivision eight of this section.\n 20. Unit of service. For the rate period from January first, nineteen\nhundred eighty-six through December thirty-first, nineteen hundred\neighty-six and for the rate period from January first, nineteen hundred\neighty-seven through December thirty-first, nineteen hundred\neighty-seven the unit of service on which payment is made to general\nhospitals for inpatient services shall be the unit of service in effect\nduring the rate period from January first, nineteen hundred eighty-five\nthrough December thirty-first, nineteen hundred eighty-five unless\nspecifically provided otherwise in this section or modified pursuant to\na subsequent chapter.\n 21. Provisions for article forty-three insurance law corporations and\narticle forty-four of this chapter organizations. Except as provided in\nparagraphs (a) and (b) of this subdivision, general hospital charges for\ninpatient and outpatient services to subscribers or beneficiaries of\ncontracts entered into pursuant to the provisions of article forty-three\nof the insurance law or to members of a comprehensive health services\nplan operating pursuant to the provisions of article forty-four of this\nchapter for patient services rendered shall not exceed the rates of\npayment approved by the superintendent of financial services or approved\nor certified by the commissioner, whichever is applicable and required\nby this section, for payments by such article forty-three insurance law\ncorporations or article forty-four of this chapter organizations. No\ngeneral hospital may demand or request any charge for such covered\nservices in addition to the charges or rates authorized by this article.\n (a) Any general hospital which terminated its contract with an article\nforty-three insurance law corporation or a comprehensive health services\nplan after October first, nineteen hundred seventy-six and prior to May\nfirst, nineteen hundred seventy-eight, may not charge subscribers or\nbeneficiaries of contracts entered into pursuant to the provisions of\narticle forty-three of the insurance law, or members of a comprehensive\nhealth services plan operating pursuant to the provisions of article\nforty-four of this chapter, amounts in excess of the schedule of charges\nestablished by such hospital for patient services in accordance with the\nprovisions of subdivision twelve of this section.\n (b) Any general hospital which has notified in writing an article\nforty-three insurance law corporation or a comprehensive health services\nplan prior to June first, nineteen hundred seventy-eight of its\nintention to terminate its contract with such corporation or plan in\naccordance with the terms of such contract, except a general hospital\nsubject to the provisions of paragraph (a) of this subdivision may not\ncharge a subscriber or beneficiary of a contract entered into pursuant\nto the provisions of article forty-three of the insurance law, or a\nmember of a comprehensive health services plan operating pursuant to the\nprovisions of article forty-four of this chapter, after the effective\ndate of termination of such contract, amounts in excess of the schedule\nof charges established by such hospital for patient services in\naccordance with the provisions of subdivision twelve of this section.\n (c) No general hospital shall refuse to provide patient services to\nsuch subscribers or beneficiaries solely on the grounds of such\nsubscription or membership.\n 22. Restitution authorization. In enforcing the provisions of\nsubdivisions twelve and twenty-one of this section, the commissioner\nmay, in addition to the penalties and injunctions set forth in section\ntwelve of this chapter, order that any general hospital provide\nrestitution for any overpayments made by any party. Any hospital may\nrequest a formal hearing pursuant to the provisions of section twelve-a\nof this chapter in the event the hospital does not consent to any order\nof the commissioner hereunder. The commissioner may direct that such a\nhearing be held without any request by a hospital.\n 23. Bad debt and charity care assessments. The commissioner shall\ncreate a bad debt and charity care statewide pool through assessments\nwhich shall be charged to general hospitals to reflect the needs for the\nfinancing of losses resulting from bad debts and the costs of charity\ncare. Such assessments will be submitted to a statewide pool as\ndesignated by the commissioner and distributed on a monthly basis in\naccordance with subdivision twenty-four of this section. The bad debt\nand charity care assessments shall be:\n (a) Three and eight-tenths percent aggregate assessment of each\ngeneral hospital's gross revenue received for inpatient hospital service\nprovided during the period July first, nineteen hundred eighty-six\nthrough December thirty-first nineteen hundred eighty-six composed of\nthe following: (i) an assessment of three and eight hundredths percent\nto be allocated to a statewide bad debt and charity care account in the\nstatewide pool and distributed in accordance with paragraph (a) of\nsubdivision twenty-four of this section, (ii) an assessment of\nthirty-eight hundredths of one percent to be allocated to a statewide\nfinancially distressed hospital account in the statewide pool and\ndistributed in accordance with paragraph (b) of subdivision twenty-four\nof this section, and (iii) an assessment of thirty-four hundredths of\none percent to be allocated to a statewide transition account in the\nstatewide pool and distributed in accordance with paragraph (c) of\nsubdivision twenty-four of this section;\n (b) One and nine-tenths percent aggregate assessment of each general\nhospital's gross revenue received for inpatient hospital service\nprovided during the period January first, nineteen hundred eighty-seven\nthrough December thirty-first, nineteen hundred eighty-seven composed of\nthe following: (i) an assessment of one and fifty-four hundredths\npercent to be allocated to a statewide bad debt and charity care account\nin the statewide pool and distributed in accordance with paragraph (a)\nof subdivision twenty-four of this section, (ii) an assessment of\nnineteen hundredths of one percent to be allocated to a statewide\nfinancially distressed hospital account in the statewide pool and\ndistributed in accordance with paragraph (b) of subdivision twenty-four\nof this section, and (iii) an assessment of seventeen hundredths of one\npercent to be allocated to a statewide transition account in the\nstatewide pool and distributed in accordance with paragraph (c) of\nsubdivision twenty-four of this section;\n (c) Provided, however, there shall be no assessment against those\nvoluntary non-profit and private proprietary general hospitals which\nqualify for distributions made in accordance with paragraph (b) of\nsubdivision sixteen of this section and paragraph (b) of subdivision\ntwenty-four of this section.\n (d) For the purposes of this subdivision and subdivision twenty-four\nof this section, gross revenue received is defined as all monies\nreceived for or on account of inpatient hospital service, provided,\nhowever, that gross revenue received shall not include distributions\nfrom regional and statewide pools established in accordance with this\nsection and shall not include the component of rates of payment related\nto the allowances provided in accordance with subdivision eight or, if\neffective, the base period adjustment factor provided in accordance with\nsubdivision ten of this section.\n 24. Statewide pool distribution. (a) Funds accumulated in the\nstatewide bad debt and charity care account in the statewide pool,\nincluding income from invested funds, shall be distributed in accordance\nwith the following methodology:\n (i) There shall be set aside within such account, from accumulated\nfunds, from the total allocation to the statewide bad debt and charity\ncare account of the assessment of three and eight hundredths percent of\ngross revenue received in accordance with subparagraph (i) of paragraph\n(a) of subdivision twenty-three of this section an amount equal to\neighty-six hundredths of one percent of gross revenue received, as\ndefined in paragraph (d) of subdivision twenty-three of this section,\nand from the total allocation to the statewide bad debt and charity care\naccount of the assessment of one and fifty-four hundredths percent of\ngross revenue received in accordance with subparagraph (i) of paragraph\n(b) of subdivision twenty-three of this section an amount equal to\nforty-three hundredths of one percent of gross revenue received, as\ndefined in paragraph (d) of subdivision twenty-three of this section.\nEach eligible major public general hospital, as defined in subdivision\neight of this section, shall receive from such funds a portion of its\nbad debt and charity care need equal to the result of the application of\nits percentage of statewide major public general hospital gross revenue\nreceived to such funds.\n (ii) Any funds within the statewide bad debt and charity care account\nset aside for major public general hospitals and not distributed in\naccordance with subparagraph (i) of this paragraph shall be distributed\nin accordance with subparagraph (iii) of this paragraph.\n (iii) Funds remaining in the statewide bad debt and charity care\naccount, after allocation in accordance with subparagraph (i) of this\nparagraph, including funds available pursuant to subparagraph (ii) of\nthis paragraph, and including income from invested funds, shall be\ndistributed proportionately on a statewide basis to voluntary\nnon-profit, private proprietary and public general hospitals, other than\nmajor public general hospitals, on the basis of need as defined in\nparagraph (e) of subdivision eight of this section. Amounts to be\ndistributed shall be determined after consideration of amounts to be\ndistributed from regional pools in accordance with paragraph (a) of\nsubdivision sixteen of this section.\n (b) Funds accumulated in the statewide financially distressed general\nhospital account in the statewide pool, including income from invested\nfunds, shall be distributed or retained in accordance with the following\nmethodology:\n (i) Funds in the statewide financially distressed general hospital\naccount, including income from invested funds, shall be made available\non a statewide basis for distribution by the commissioner in accordance\nwith rules and regulations adopted by the council and approved by the\ncommissioner to assist voluntary non-profit and private proprietary\ngeneral hospitals experiencing severe fiscal hardship because of\ninsufficient resources to finance losses resulting from bad debts and\nthe costs of charity care, and to meet reasonable and necessary costs\nrelated to securing financing of capital improvement projects for such\ngeneral hospitals. Such losses and costs may include losses and costs\nincurred prior to the year used in determining hospital need pursuant to\nparagraph (e) of subdivision eight of this section. Amounts to be\ndistributed shall be determined after consideration of amounts to be\ndistributed from regional pools in accordance with subdivision sixteen\nof this section and from the statewide bad debt and charity care account\nin accordance with subparagraph (iii) of paragraph (a) of this\nsubdivision. The commissioner, in accordance with rules and regulations\nadopted by the council and approved by the commissioner, may allocate a\nportion of the accumulated funds for the purpose of securing financing\nof capital improvement projects for such general hospitals.\n (ii) Any balance remaining in the statewide financially distressed\ngeneral hospital account, including income from invested funds, not\nincluding that portion of accumulated funds allocated for the purpose of\nsecuring financing of capital improvement projects, after distribution\nin accordance with subparagraph (i) of this paragraph shall be\ndistributed to voluntary non-profit, private proprietary and public\ngeneral hospitals, other than major public general hospitals, on a basis\nrelated to need as defined in paragraph (e) of subdivision eight of this\nsection.\n (c) (i) Funds accumulated in the statewide transition account in the\nstatewide pool, including income from invested funds, shall be\ndistributed to voluntary non-profit, private proprietary and public\ngeneral hospitals that have high percentages of gross revenue received\nfrom payors whose rates and maximum charges are determined in accordance\nwith this section compared to total gross revenue received. For purposes\nof this subparagraph, major public general hospitals operated by the New\nYork city health and hospitals corporation as established by chapter one\nthousand sixteen of the laws of nineteen hundred sixty-nine as amended\nshall be considered on a consolidated basis. Rules for such distribution\nwill be those adopted by the state hospital review and planning council\nand approved by the commissioner.\n (ii) Any balance remaining in the statewide transition account,\nincluding income from invested funds, after distribution in accordance\nwith subparagraph (i) of this paragraph shall be distributed to\nvoluntary non-profit, private proprietary and public general hospitals,\nother than major public general hospitals, on a basis related to need as\ndefined in paragraph (e) of subdivision eight of this section.\n 25. Maximum distributions. No general hospital may receive in total\nfrom the distributions made in accordance with paragraphs (a) and (c) of\nsubdivision sixteen of this section and paragraph (a), subparagraph (ii)\nof paragraph (b) and subparagraph (ii) of paragraph (c) of subdivision\ntwenty-four of this section an amount which exceeds its need for\nfinancing losses related to bad debts and the costs of charity care as\ndefined in paragraph (e) of subdivision eight of this section.\n 26. Undistributed funds. Any funds, including income from invested\nfunds, remaining in the statewide pool after distributions in accordance\nwith paragraphs (a), (b) and (c) of subdivision twenty-four of this\nsection shall be distributed proportionately to voluntary non-profit,\nprivate proprietary and public general hospitals, excluding major public\ngeneral hospitals, on the basis of hospital specific assessments\nsubmitted to the pool.\n 27. Payment of assessments. Payments by or on behalf of general\nhospitals of funds due for the bad debt and charity care assessments\npursuant to subdivision twenty-three of this section shall be made on a\ntime schedule established by the council, subject to the approval of the\ncommissioner, by regulation. Upon receipt of notification from the\ncommissioner, the comptroller or a fiscal intermediary designated by the\ndirector of the budget shall withhold from the amount of any payment to\nbe made by the state to a general hospital the amount of any arrearage\nresulting from such general hospital's failure to make a timely payment\nof the bad debt and charity care assessments. Upon withholding such\namount, the comptroller or a designated fiscal intermediary shall pay\nthe commissioner, or his designee, such amount withheld. Any general\nhospital in arrears resulting from failure to make a timely payment\nshall not be eligible for a distribution from the statewide pool in\naccordance with subdivision twenty-four of this section until such\narrearage is satisfied.\n 28. Reimbursement rates. The assessments pursuant to subdivision\ntwenty-three of this section shall not be an allowable cost in the\ndetermination of general hospital inpatient reimbursement rates in\naccordance with this section and section twenty-eight hundred seven of\nthis chapter.\n