Bill Text: IL HB1868 | 2025-2026 | 104th General Assembly | Introduced

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Bill Title: Amends the Hospital Provider Funding Article of the Illinois Public Aid Code. In a provision requiring the Department of Healthcare and Family Services to create a pool of funding of at least $50,000,000 annually to be disbursed among safety-net hospitals that maintain perinatal designation from the Department of Public Health, provides that no safety-net hospital eligible for funds shall receive less than $5,000,000 annually.

Spectrum: Partisan Bill (Democrat 1-0)

Status: (Introduced) 2025-01-29 - Referred to Rules Committee [HB1868 Detail]

Download: Illinois-2025-HB1868-Introduced.html

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104TH GENERAL ASSEMBLY State of Illinois 2025 and 2026 HB1868 Introduced , by Rep. Kam Buckner SYNOPSIS AS INTRODUCED:
305 ILCS 5/5A-12.7
Amends the Hospital Provider Funding Article of the Illinois Public Aid Code. In a provision requiring the Department of Healthcare and Family Services to create a pool of funding of at least $50,000,000 annually to be disbursed among safety-net hospitals that maintain perinatal designation from the Department of Public Health, provides that no safety-net hospital eligible for funds shall receive less than $5,000,000 annually.
LRB104 09496 KTG 19557 b
A BILL FOR
HB1868 LRB104 09496 KTG 19557 b
AN ACT concerning public aid.
Be it enacted by the People of the State of Illinois,
represented in the General Assembly:
Section 5. The Illinois Public Aid Code is amended by
changing Section 5A-12.7 as follows:
(305 ILCS 5/5A-12.7)
(Section scheduled to be repealed on December 31, 2026)
Sec. 5A-12.7. Continuation of hospital access payments on
and after July 1, 2020.
(a) To preserve and improve access to hospital services,
for hospital services rendered on and after July 1, 2020, the
Department shall, except for hospitals described in subsection
(b) of Section 5A-3, make payments to hospitals or require
capitated managed care organizations to make payments as set
forth in this Section. Payments under this Section are not due
and payable, however, until: (i) the methodologies described
in this Section are approved by the federal government in an
appropriate State Plan amendment or directed payment preprint;
and (ii) the assessment imposed under this Article is
determined to be a permissible tax under Title XIX of the
Social Security Act. In determining the hospital access
payments authorized under subsection (g) of this Section, if a
hospital ceases to qualify for payments from the pool, the

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payments for all hospitals continuing to qualify for payments
from such pool shall be uniformly adjusted to fully expend the
aggregate net amount of the pool, with such adjustment being
effective on the first day of the second month following the
date the hospital ceases to receive payments from such pool.
(b) Amounts moved into claims-based rates and distributed
in accordance with Section 14-12 shall remain in those
claims-based rates.
(c) Graduate medical education.
(1) The calculation of graduate medical education
payments shall be based on the hospital's Medicare cost
report ending in Calendar Year 2018, as reported in the
Healthcare Cost Report Information System file, release
date September 30, 2019. An Illinois hospital reporting
intern and resident cost on its Medicare cost report shall
be eligible for graduate medical education payments.
(2) Each hospital's annualized Medicaid Intern
Resident Cost is calculated using annualized intern and
resident total costs obtained from Worksheet B Part I,
Columns 21 and 22 the sum of Lines 30-43, 50-76, 90-93,
96-98, and 105-112 multiplied by the percentage that the
hospital's Medicaid days (Worksheet S3 Part I, Column 7,
Lines 2, 3, 4, 14, 16-18, and 32) comprise of the
hospital's total days (Worksheet S3 Part I, Column 8,
Lines 14, 16-18, and 32).
(3) An annualized Medicaid indirect medical education

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(IME) payment is calculated for each hospital using its
IME payments (Worksheet E Part A, Line 29, Column 1)
multiplied by the percentage that its Medicaid days
(Worksheet S3 Part I, Column 7, Lines 2, 3, 4, 14, 16-18,
and 32) comprise of its Medicare days (Worksheet S3 Part
I, Column 6, Lines 2, 3, 4, 14, and 16-18).
(4) For each hospital, its annualized Medicaid Intern
Resident Cost and its annualized Medicaid IME payment are
summed, and, except as capped at 120% of the average cost
per intern and resident for all qualifying hospitals as
calculated under this paragraph, is multiplied by the
applicable reimbursement factor as described in this
paragraph, to determine the hospital's final graduate
medical education payment. Each hospital's average cost
per intern and resident shall be calculated by summing its
total annualized Medicaid Intern Resident Cost plus its
annualized Medicaid IME payment and dividing that amount
by the hospital's total Full Time Equivalent Residents and
Interns. If the hospital's average per intern and resident
cost is greater than 120% of the same calculation for all
qualifying hospitals, the hospital's per intern and
resident cost shall be capped at 120% of the average cost
for all qualifying hospitals.
(A) For the period of July 1, 2020 through
December 31, 2022, the applicable reimbursement factor
shall be 22.6%.

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(B) For the period of January 1, 2023 through
December 31, 2026, the applicable reimbursement factor
shall be 35% for all qualified safety-net hospitals,
as defined in Section 5-5e.1 of this Code, and all
hospitals with 100 or more Full Time Equivalent
Residents and Interns, as reported on the hospital's
Medicare cost report ending in Calendar Year 2018, and
for all other qualified hospitals the applicable
reimbursement factor shall be 30%.
(d) Fee-for-service supplemental payments. For the period
of July 1, 2020 through December 31, 2022, each Illinois
hospital shall receive an annual payment equal to the amounts
below, to be paid in 12 equal installments on or before the
seventh State business day of each month, except that no
payment shall be due within 30 days after the later of the date
of notification of federal approval of the payment
methodologies required under this Section or any waiver
required under 42 CFR 433.68, at which time the sum of amounts
required under this Section prior to the date of notification
is due and payable.
(1) For critical access hospitals, $385 per covered
inpatient day contained in paid fee-for-service claims and
$530 per paid fee-for-service outpatient claim for dates
of service in Calendar Year 2019 in the Department's
Enterprise Data Warehouse as of May 11, 2020.
(2) For safety-net hospitals, $960 per covered

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inpatient day contained in paid fee-for-service claims and
$625 per paid fee-for-service outpatient claim for dates
of service in Calendar Year 2019 in the Department's
Enterprise Data Warehouse as of May 11, 2020.
(3) For long term acute care hospitals, $295 per
covered inpatient day contained in paid fee-for-service
claims for dates of service in Calendar Year 2019 in the
Department's Enterprise Data Warehouse as of May 11, 2020.
(4) For freestanding psychiatric hospitals, $125 per
covered inpatient day contained in paid fee-for-service
claims and $130 per paid fee-for-service outpatient claim
for dates of service in Calendar Year 2019 in the
Department's Enterprise Data Warehouse as of May 11, 2020.
(5) For freestanding rehabilitation hospitals, $355
per covered inpatient day contained in paid
fee-for-service claims for dates of service in Calendar
Year 2019 in the Department's Enterprise Data Warehouse as
of May 11, 2020.
(6) For all general acute care hospitals and high
Medicaid hospitals as defined in subsection (f), $350 per
covered inpatient day for dates of service in Calendar
Year 2019 contained in paid fee-for-service claims and
$620 per paid fee-for-service outpatient claim in the
Department's Enterprise Data Warehouse as of May 11, 2020.
(7) Alzheimer's treatment access payment. Each
Illinois academic medical center or teaching hospital, as

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defined in Section 5-5e.2 of this Code, that is identified
as the primary hospital affiliate of one of the Regional
Alzheimer's Disease Assistance Centers, as designated by
the Alzheimer's Disease Assistance Act and identified in
the Department of Public Health's Alzheimer's Disease
State Plan dated December 2016, shall be paid an
Alzheimer's treatment access payment equal to the product
of the qualifying hospital's State Fiscal Year 2018 total
inpatient fee-for-service days multiplied by the
applicable Alzheimer's treatment rate of $226.30 for
hospitals located in Cook County and $116.21 for hospitals
located outside Cook County.
(d-2) Fee-for-service supplemental payments. Beginning
January 1, 2023, each Illinois hospital shall receive an
annual payment equal to the amounts listed below, to be paid in
12 equal installments on or before the seventh State business
day of each month, except that no payment shall be due within
30 days after the later of the date of notification of federal
approval of the payment methodologies required under this
Section or any waiver required under 42 CFR 433.68, at which
time the sum of amounts required under this Section prior to
the date of notification is due and payable. The Department
may adjust the rates in paragraphs (1) through (7) to comply
with the federal upper payment limits, with such adjustments
being determined so that the total estimated spending by
hospital class, under such adjusted rates, remains

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substantially similar to the total estimated spending under
the original rates set forth in this subsection.
(1) For critical access hospitals, as defined in
subsection (f), $750 per covered inpatient day contained
in paid fee-for-service claims and $750 per paid
fee-for-service outpatient claim for dates of service in
Calendar Year 2019 in the Department's Enterprise Data
Warehouse as of August 6, 2021.
(2) For safety-net hospitals, as described in
subsection (f), $1,350 per inpatient day contained in paid
fee-for-service claims and $1,350 per paid fee-for-service
outpatient claim for dates of service in Calendar Year
2019 in the Department's Enterprise Data Warehouse as of
August 6, 2021.
(3) For long term acute care hospitals, $550 per
covered inpatient day contained in paid fee-for-service
claims for dates of service in Calendar Year 2019 in the
Department's Enterprise Data Warehouse as of August 6,
2021.
(4) For freestanding psychiatric hospitals, $200 per
covered inpatient day contained in paid fee-for-service
claims and $200 per paid fee-for-service outpatient claim
for dates of service in Calendar Year 2019 in the
Department's Enterprise Data Warehouse as of August 6,
2021.
(5) For freestanding rehabilitation hospitals, $550

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per covered inpatient day contained in paid
fee-for-service claims and $125 per paid fee-for-service
outpatient claim for dates of service in Calendar Year
2019 in the Department's Enterprise Data Warehouse as of
August 6, 2021.
(6) For all general acute care hospitals and high
Medicaid hospitals as defined in subsection (f), $500 per
covered inpatient day for dates of service in Calendar
Year 2019 contained in paid fee-for-service claims and
$500 per paid fee-for-service outpatient claim in the
Department's Enterprise Data Warehouse as of August 6,
2021.
(7) For public hospitals, as defined in subsection
(f), $275 per covered inpatient day contained in paid
fee-for-service claims and $275 per paid fee-for-service
outpatient claim for dates of service in Calendar Year
2019 in the Department's Enterprise Data Warehouse as of
August 6, 2021.
(8) Alzheimer's treatment access payment. Each
Illinois academic medical center or teaching hospital, as
defined in Section 5-5e.2 of this Code, that is identified
as the primary hospital affiliate of one of the Regional
Alzheimer's Disease Assistance Centers, as designated by
the Alzheimer's Disease Assistance Act and identified in
the Department of Public Health's Alzheimer's Disease
State Plan dated December 2016, shall be paid an

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Alzheimer's treatment access payment equal to the product
of the qualifying hospital's Calendar Year 2019 total
inpatient fee-for-service days, in the Department's
Enterprise Data Warehouse as of August 6, 2021, multiplied
by the applicable Alzheimer's treatment rate of $244.37
for hospitals located in Cook County and $312.03 for
hospitals located outside Cook County.
(e) The Department shall require managed care
organizations (MCOs) to make directed payments and
pass-through payments according to this Section. Each calendar
year, the Department shall require MCOs to pay the maximum
amount out of these funds as allowed as pass-through payments
under federal regulations. The Department shall require MCOs
to make such pass-through payments as specified in this
Section. The Department shall require the MCOs to pay the
remaining amounts as directed Payments as specified in this
Section. The Department shall issue payments to the
Comptroller by the seventh business day of each month for all
MCOs that are sufficient for MCOs to make the directed
payments and pass-through payments according to this Section.
The Department shall require the MCOs to make pass-through
payments and directed payments using electronic funds
transfers (EFT), if the hospital provides the information
necessary to process such EFTs, in accordance with directions
provided monthly by the Department, within 7 business days of
the date the funds are paid to the MCOs, as indicated by the

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"Paid Date" on the website of the Office of the Comptroller if
the funds are paid by EFT and the MCOs have received directed
payment instructions. If funds are not paid through the
Comptroller by EFT, payment must be made within 7 business
days of the date actually received by the MCO. The MCO will be
considered to have paid the pass-through payments when the
payment remittance number is generated or the date the MCO
sends the check to the hospital, if EFT information is not
supplied. If an MCO is late in paying a pass-through payment or
directed payment as required under this Section (including any
extensions granted by the Department), it shall pay a penalty,
unless waived by the Department for reasonable cause, to the
Department equal to 5% of the amount of the pass-through
payment or directed payment not paid on or before the due date
plus 5% of the portion thereof remaining unpaid on the last day
of each 30-day period thereafter. Payments to MCOs that would
be paid consistent with actuarial certification and enrollment
in the absence of the increased capitation payments under this
Section shall not be reduced as a consequence of payments made
under this subsection. The Department shall publish and
maintain on its website for a period of no less than 8 calendar
quarters, the quarterly calculation of directed payments and
pass-through payments owed to each hospital from each MCO. All
calculations and reports shall be posted no later than the
first day of the quarter for which the payments are to be
issued.

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(f)(1) For purposes of allocating the funds included in
capitation payments to MCOs, Illinois hospitals shall be
divided into the following classes as defined in
administrative rules:
(A) Beginning July 1, 2020 through December 31, 2022,
critical access hospitals. Beginning January 1, 2023,
"critical access hospital" means a hospital designated by
the Department of Public Health as a critical access
hospital, excluding any hospital meeting the definition of
a public hospital in subparagraph (F).
(B) Safety-net hospitals, except that stand-alone
children's hospitals that are not specialty children's
hospitals and, for calendar years 2025 and 2026 only,
hospitals with over 9,000 Medicaid acute care inpatient
admissions per calendar year, excluding admissions for
Medicare-Medicaid dual eligible patients, will not be
included. For the calendar year beginning January 1, 2023,
and each calendar year thereafter, assignment to the
safety-net class shall be based on the annual safety-net
rate year beginning 15 months before the beginning of the
first Payout Quarter of the calendar year.
(C) Long term acute care hospitals.
(D) Freestanding psychiatric hospitals.
(E) Freestanding rehabilitation hospitals.
(F) Beginning January 1, 2023, "public hospital" means
a hospital that is owned or operated by an Illinois

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Government body or municipality, excluding a hospital
provider that is a State agency, a State university, or a
county with a population of 3,000,000 or more.
(G) High Medicaid hospitals.
(i) As used in this Section, "high Medicaid
hospital" means a general acute care hospital that:
(I) For the payout periods July 1, 2020
through December 31, 2022, is not a safety-net
hospital or critical access hospital and that has
a Medicaid Inpatient Utilization Rate above 30% or
a hospital that had over 35,000 inpatient Medicaid
days during the applicable period. For the period
July 1, 2020 through December 31, 2020, the
applicable period for the Medicaid Inpatient
Utilization Rate (MIUR) is the rate year 2020 MIUR
and for the number of inpatient days it is State
fiscal year 2018. Beginning in calendar year 2021,
the Department shall use the most recently
determined MIUR, as defined in subsection (h) of
Section 5-5.02, and for the inpatient day
threshold, the State fiscal year ending 18 months
prior to the beginning of the calendar year. For
purposes of calculating MIUR under this Section,
children's hospitals and affiliated general acute
care hospitals shall be considered a single
hospital.

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(II) For the calendar year beginning January
1, 2023, and each calendar year thereafter, is not
a public hospital, safety-net hospital, or
critical access hospital and that qualifies as a
regional high volume hospital or is a hospital
that has a Medicaid Inpatient Utilization Rate
(MIUR) above 30%. As used in this item, "regional
high volume hospital" means a hospital which ranks
in the top 2 quartiles based on total hospital
services volume, of all eligible general acute
care hospitals, when ranked in descending order
based on total hospital services volume, within
the same Medicaid managed care region, as
designated by the Department, as of January 1,
2022. As used in this item, "total hospital
services volume" means the total of all Medical
Assistance hospital inpatient admissions plus all
Medical Assistance hospital outpatient visits. For
purposes of determining regional high volume
hospital inpatient admissions and outpatient
visits, the Department shall use dates of service
provided during State Fiscal Year 2020 for the
Payout Quarter beginning January 1, 2023. The
Department shall use dates of service from the
State fiscal year ending 18 month before the
beginning of the first Payout Quarter of the

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subsequent annual determination period.
(ii) For the calendar year beginning January 1,
2023, the Department shall use the Rate Year 2022
Medicaid inpatient utilization rate (MIUR), as defined
in subsection (h) of Section 5-5.02. For each
subsequent annual determination, the Department shall
use the MIUR applicable to the rate year ending
September 30 of the year preceding the beginning of
the calendar year.
(H) General acute care hospitals. As used under this
Section, "general acute care hospitals" means all other
Illinois hospitals not identified in subparagraphs (A)
through (G).
(2) Hospitals' qualification for each class shall be
assessed prior to the beginning of each calendar year and the
new class designation shall be effective January 1 of the next
year. The Department shall publish by rule the process for
establishing class determination.
(3) Beginning January 1, 2024, the Department may reassign
hospitals or entire hospital classes as defined above, if
federal limits on the payments to the class to which the
hospitals are assigned based on the criteria in this
subsection prevent the Department from making payments to the
class that would otherwise be due under this Section. The
Department shall publish the criteria and composition of each
new class based on the reassignments, and the projected impact

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on payments to each hospital under the new classes on its
website by November 15 of the year before the year in which the
class changes become effective.
(g) Fixed pool directed payments. Beginning July 1, 2020,
the Department shall issue payments to MCOs which shall be
used to issue directed payments to qualified Illinois
safety-net hospitals and critical access hospitals on a
monthly basis in accordance with this subsection. Prior to the
beginning of each Payout Quarter beginning July 1, 2020, the
Department shall use encounter claims data from the
Determination Quarter, accepted by the Department's Medicaid
Management Information System for inpatient and outpatient
services rendered by safety-net hospitals and critical access
hospitals to determine a quarterly uniform per unit add-on for
each hospital class.
(1) Inpatient per unit add-on. A quarterly uniform per
diem add-on shall be derived by dividing the quarterly
Inpatient Directed Payments Pool amount allocated to the
applicable hospital class by the total inpatient days
contained on all encounter claims received during the
Determination Quarter, for all hospitals in the class.
(A) Each hospital in the class shall have a
quarterly inpatient directed payment calculated that
is equal to the product of the number of inpatient days
attributable to the hospital used in the calculation
of the quarterly uniform class per diem add-on,

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multiplied by the calculated applicable quarterly
uniform class per diem add-on of the hospital class.
(B) Each hospital shall be paid 1/3 of its
quarterly inpatient directed payment in each of the 3
months of the Payout Quarter, in accordance with
directions provided to each MCO by the Department.
(2) Outpatient per unit add-on. A quarterly uniform
per claim add-on shall be derived by dividing the
quarterly Outpatient Directed Payments Pool amount
allocated to the applicable hospital class by the total
outpatient encounter claims received during the
Determination Quarter, for all hospitals in the class.
(A) Each hospital in the class shall have a
quarterly outpatient directed payment calculated that
is equal to the product of the number of outpatient
encounter claims attributable to the hospital used in
the calculation of the quarterly uniform class per
claim add-on, multiplied by the calculated applicable
quarterly uniform class per claim add-on of the
hospital class.
(B) Each hospital shall be paid 1/3 of its
quarterly outpatient directed payment in each of the 3
months of the Payout Quarter, in accordance with
directions provided to each MCO by the Department.
(3) Each MCO shall pay each hospital the Monthly
Directed Payment as identified by the Department on its

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quarterly determination report.
(4) Definitions. As used in this subsection:
(A) "Payout Quarter" means each 3 month calendar
quarter, beginning July 1, 2020.
(B) "Determination Quarter" means each 3 month
calendar quarter, which ends 3 months prior to the
first day of each Payout Quarter.
(5) For the period July 1, 2020 through December 2020,
the following amounts shall be allocated to the following
hospital class directed payment pools for the quarterly
development of a uniform per unit add-on:
(A) $2,894,500 for hospital inpatient services for
critical access hospitals.
(B) $4,294,374 for hospital outpatient services
for critical access hospitals.
(C) $29,109,330 for hospital inpatient services
for safety-net hospitals.
(D) $35,041,218 for hospital outpatient services
for safety-net hospitals.
(6) For the period January 1, 2023 through December
31, 2023, the Department shall establish the amounts that
shall be allocated to the hospital class directed payment
fixed pools identified in this paragraph for the quarterly
development of a uniform per unit add-on. The Department
shall establish such amounts so that the total amount of
payments to each hospital under this Section in calendar

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year 2023 is projected to be substantially similar to the
total amount of such payments received by the hospital
under this Section in calendar year 2021, adjusted for
increased funding provided for fixed pool directed
payments under subsection (g) in calendar year 2022,
assuming that the volume and acuity of claims are held
constant. The Department shall publish the directed
payment fixed pool amounts to be established under this
paragraph on its website by November 15, 2022.
(A) Hospital inpatient services for critical
access hospitals.
(B) Hospital outpatient services for critical
access hospitals.
(C) Hospital inpatient services for public
hospitals.
(D) Hospital outpatient services for public
hospitals.
(E) Hospital inpatient services for safety-net
hospitals.
(F) Hospital outpatient services for safety-net
hospitals.
(7) Semi-annual rate maintenance review. The
Department shall ensure that hospitals assigned to the
fixed pools in paragraph (6) are paid no less than 95% of
the annual initial rate for each 6-month period of each
annual payout period. For each calendar year, the

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Department shall calculate the annual initial rate per day
and per visit for each fixed pool hospital class listed in
paragraph (6), by dividing the total of all applicable
inpatient or outpatient directed payments issued in the
preceding calendar year to the hospitals in each fixed
pool class for the calendar year, plus any increase
resulting from the annual adjustments described in
subsection (i), by the actual applicable total service
units for the preceding calendar year which were the basis
of the total applicable inpatient or outpatient directed
payments issued to the hospitals in each fixed pool class
in the calendar year, except that for calendar year 2023,
the service units from calendar year 2021 shall be used.
(A) The Department shall calculate the effective
rate, per day and per visit, for the payout periods of
January to June and July to December of each year, for
each fixed pool listed in paragraph (6), by dividing
50% of the annual pool by the total applicable
reported service units for the 2 applicable
determination quarters.
(B) If the effective rate calculated in
subparagraph (A) is less than 95% of the annual
initial rate assigned to the class for each pool under
paragraph (6), the Department shall adjust the payment
for each hospital to a level equal to no less than 95%
of the annual initial rate, by issuing a retroactive

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adjustment payment for the 6-month period under review
as identified in subparagraph (A).
(h) Fixed rate directed payments. Effective July 1, 2020,
the Department shall issue payments to MCOs which shall be
used to issue directed payments to Illinois hospitals not
identified in paragraph (g) on a monthly basis. Prior to the
beginning of each Payout Quarter beginning July 1, 2020, the
Department shall use encounter claims data from the
Determination Quarter, accepted by the Department's Medicaid
Management Information System for inpatient and outpatient
services rendered by hospitals in each hospital class
identified in paragraph (f) and not identified in paragraph
(g). For the period July 1, 2020 through December 2020, the
Department shall direct MCOs to make payments as follows:
(1) For general acute care hospitals an amount equal
to $1,750 multiplied by the hospital's category of service
20 case mix index for the determination quarter multiplied
by the hospital's total number of inpatient admissions for
category of service 20 for the determination quarter.
(2) For general acute care hospitals an amount equal
to $160 multiplied by the hospital's category of service
21 case mix index for the determination quarter multiplied
by the hospital's total number of inpatient admissions for
category of service 21 for the determination quarter.
(3) For general acute care hospitals an amount equal
to $80 multiplied by the hospital's category of service 22

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case mix index for the determination quarter multiplied by
the hospital's total number of inpatient admissions for
category of service 22 for the determination quarter.
(4) For general acute care hospitals an amount equal
to $375 multiplied by the hospital's category of service
24 case mix index for the determination quarter multiplied
by the hospital's total number of category of service 24
paid EAPG (EAPGs) for the determination quarter.
(5) For general acute care hospitals an amount equal
to $240 multiplied by the hospital's category of service
27 and 28 case mix index for the determination quarter
multiplied by the hospital's total number of category of
service 27 and 28 paid EAPGs for the determination
quarter.
(6) For general acute care hospitals an amount equal
to $290 multiplied by the hospital's category of service
29 case mix index for the determination quarter multiplied
by the hospital's total number of category of service 29
paid EAPGs for the determination quarter.
(7) For high Medicaid hospitals an amount equal to
$1,800 multiplied by the hospital's category of service 20
case mix index for the determination quarter multiplied by
the hospital's total number of inpatient admissions for
category of service 20 for the determination quarter.
(8) For high Medicaid hospitals an amount equal to
$160 multiplied by the hospital's category of service 21

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case mix index for the determination quarter multiplied by
the hospital's total number of inpatient admissions for
category of service 21 for the determination quarter.
(9) For high Medicaid hospitals an amount equal to $80
multiplied by the hospital's category of service 22 case
mix index for the determination quarter multiplied by the
hospital's total number of inpatient admissions for
category of service 22 for the determination quarter.
(10) For high Medicaid hospitals an amount equal to
$400 multiplied by the hospital's category of service 24
case mix index for the determination quarter multiplied by
the hospital's total number of category of service 24 paid
EAPG outpatient claims for the determination quarter.
(11) For high Medicaid hospitals an amount equal to
$240 multiplied by the hospital's category of service 27
and 28 case mix index for the determination quarter
multiplied by the hospital's total number of category of
service 27 and 28 paid EAPGs for the determination
quarter.
(12) For high Medicaid hospitals an amount equal to
$290 multiplied by the hospital's category of service 29
case mix index for the determination quarter multiplied by
the hospital's total number of category of service 29 paid
EAPGs for the determination quarter.
(13) For long term acute care hospitals the amount of
$495 multiplied by the hospital's total number of

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inpatient days for the determination quarter.
(14) For psychiatric hospitals the amount of $210
multiplied by the hospital's total number of inpatient
days for category of service 21 for the determination
quarter.
(15) For psychiatric hospitals the amount of $250
multiplied by the hospital's total number of outpatient
claims for category of service 27 and 28 for the
determination quarter.
(16) For rehabilitation hospitals the amount of $410
multiplied by the hospital's total number of inpatient
days for category of service 22 for the determination
quarter.
(17) For rehabilitation hospitals the amount of $100
multiplied by the hospital's total number of outpatient
claims for category of service 29 for the determination
quarter.
(18) Effective for the Payout Quarter beginning
January 1, 2023, for the directed payments to hospitals
required under this subsection, the Department shall
establish the amounts that shall be used to calculate such
directed payments using the methodologies specified in
this paragraph. The Department shall use a single, uniform
rate, adjusted for acuity as specified in paragraphs (1)
through (12), for all categories of inpatient services
provided by each class of hospitals and a single uniform

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rate, adjusted for acuity as specified in paragraphs (1)
through (12), for all categories of outpatient services
provided by each class of hospitals. The Department shall
establish such amounts so that the total amount of
payments to each hospital under this Section in calendar
year 2023 is projected to be substantially similar to the
total amount of such payments received by the hospital
under this Section in calendar year 2021, adjusted for
increased funding provided for fixed pool directed
payments under subsection (g) in calendar year 2022,
assuming that the volume and acuity of claims are held
constant. The Department shall publish the directed
payment amounts to be established under this subsection on
its website by November 15, 2022.
(19) Each hospital shall be paid 1/3 of their
quarterly inpatient and outpatient directed payment in
each of the 3 months of the Payout Quarter, in accordance
with directions provided to each MCO by the Department.
(20) Each MCO shall pay each hospital the Monthly
Directed Payment amount as identified by the Department on
its quarterly determination report.
Notwithstanding any other provision of this subsection, if
the Department determines that the actual total hospital
utilization data that is used to calculate the fixed rate
directed payments is substantially different than anticipated
when the rates in this subsection were initially determined

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for unforeseeable circumstances (such as the COVID-19 pandemic
or some other public health emergency), the Department may
adjust the rates specified in this subsection so that the
total directed payments approximate the total spending amount
anticipated when the rates were initially established.
Definitions. As used in this subsection:
(A) "Payout Quarter" means each calendar quarter,
beginning July 1, 2020.
(B) "Determination Quarter" means each calendar
quarter which ends 3 months prior to the first day of
each Payout Quarter.
(C) "Case mix index" means a hospital specific
calculation. For inpatient claims the case mix index
is calculated each quarter by summing the relative
weight of all inpatient Diagnosis-Related Group (DRG)
claims for a category of service in the applicable
Determination Quarter and dividing the sum by the
number of sum total of all inpatient DRG admissions
for the category of service for the associated claims.
The case mix index for outpatient claims is calculated
each quarter by summing the relative weight of all
paid EAPGs in the applicable Determination Quarter and
dividing the sum by the sum total of paid EAPGs for the
associated claims.
(i) Beginning January 1, 2021, the rates for directed
payments shall be recalculated in order to spend the

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additional funds for directed payments that result from
reduction in the amount of pass-through payments allowed under
federal regulations. The additional funds for directed
payments shall be allocated proportionally to each class of
hospitals based on that class' proportion of services.
(1) Beginning January 1, 2024, the fixed pool directed
payment amounts and the associated annual initial rates
referenced in paragraph (6) of subsection (f) for each
hospital class shall be uniformly increased by a ratio of
not less than, the ratio of the total pass-through
reduction amount pursuant to paragraph (4) of subsection
(j), for the hospitals comprising the hospital fixed pool
directed payment class for the next calendar year, to the
total inpatient and outpatient directed payments for the
hospitals comprising the hospital fixed pool directed
payment class paid during the preceding calendar year.
(2) Beginning January 1, 2024, the fixed rates for the
directed payments referenced in paragraph (18) of
subsection (h) for each hospital class shall be uniformly
increased by a ratio of not less than, the ratio of the
total pass-through reduction amount pursuant to paragraph
(4) of subsection (j), for the hospitals comprising the
hospital directed payment class for the next calendar
year, to the total inpatient and outpatient directed
payments for the hospitals comprising the hospital fixed
rate directed payment class paid during the preceding

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calendar year.
(j) Pass-through payments.
(1) For the period July 1, 2020 through December 31,
2020, the Department shall assign quarterly pass-through
payments to each class of hospitals equal to one-fourth of
the following annual allocations:
(A) $390,487,095 to safety-net hospitals.
(B) $62,553,886 to critical access hospitals.
(C) $345,021,438 to high Medicaid hospitals.
(D) $551,429,071 to general acute care hospitals.
(E) $27,283,870 to long term acute care hospitals.
(F) $40,825,444 to freestanding psychiatric
hospitals.
(G) $9,652,108 to freestanding rehabilitation
hospitals.
(2) For the period of July 1, 2020 through December
31, 2020, the pass-through payments shall at a minimum
ensure hospitals receive a total amount of monthly
payments under this Section as received in calendar year
2019 in accordance with this Article and paragraph (1) of
subsection (d-5) of Section 14-12, exclusive of amounts
received through payments referenced in subsection (b).
(3) For the calendar year beginning January 1, 2023,
the Department shall establish the annual pass-through
allocation to each class of hospitals and the pass-through
payments to each hospital so that the total amount of

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payments to each hospital under this Section in calendar
year 2023 is projected to be substantially similar to the
total amount of such payments received by the hospital
under this Section in calendar year 2021, adjusted for
increased funding provided for fixed pool directed
payments under subsection (g) in calendar year 2022,
assuming that the volume and acuity of claims are held
constant. The Department shall publish the pass-through
allocation to each class and the pass-through payments to
each hospital to be established under this subsection on
its website by November 15, 2022.
(4) For the calendar years beginning January 1, 2021
and January 1, 2022, each hospital's pass-through payment
amount shall be reduced proportionally to the reduction of
all pass-through payments required by federal regulations.
Beginning January 1, 2024, the Department shall reduce
total pass-through payments by the minimum amount
necessary to comply with federal regulations. Pass-through
payments to safety-net hospitals, as defined in Section
5-5e.1 of this Code, shall not be reduced until all
pass-through payments to other hospitals have been
eliminated. All other hospitals shall have their
pass-through payments reduced proportionally.
(k) At least 30 days prior to each calendar year, the
Department shall notify each hospital of changes to the
payment methodologies in this Section, including, but not

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limited to, changes in the fixed rate directed payment rates,
the aggregate pass-through payment amount for all hospitals,
and the hospital's pass-through payment amount for the
upcoming calendar year.
(l) Notwithstanding any other provisions of this Section,
the Department may adopt rules to change the methodology for
directed and pass-through payments as set forth in this
Section, but only to the extent necessary to obtain federal
approval of a necessary State Plan amendment or Directed
Payment Preprint or to otherwise conform to federal law or
federal regulation.
(m) As used in this subsection, "managed care
organization" or "MCO" means an entity which contracts with
the Department to provide services where payment for medical
services is made on a capitated basis, excluding contracted
entities for dual eligible or Department of Children and
Family Services youth populations.
(n) In order to address the escalating infant mortality
rates among minority communities in Illinois, the State shall,
subject to appropriation, create a pool of funding of at least
$50,000,000 annually to be disbursed among safety-net
hospitals that maintain perinatal designation from the
Department of Public Health. No safety-net hospital eligible
for funds under this subsection shall receive less than
$5,000,000 annually. The funding shall be used to preserve or
enhance OB/GYN services or other specialty services at the

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receiving hospital, with the distribution of funding to be
established by rule and with consideration to perinatal
hospitals with safe birthing levels and quality metrics for
healthy mothers and babies.
(o) In order to address the growing challenges of
providing stable access to healthcare in rural Illinois,
including perinatal services, behavioral healthcare including
substance use disorder services (SUDs) and other specialty
services, and to expand access to telehealth services among
rural communities in Illinois, the Department of Healthcare
and Family Services shall administer a program to provide at
least $10,000,000 in financial support annually to critical
access hospitals for delivery of perinatal and OB/GYN
services, behavioral healthcare including SUDS, other
specialty services and telehealth services. The funding shall
be used to preserve or enhance perinatal and OB/GYN services,
behavioral healthcare including SUDS, other specialty
services, as well as the explanation of telehealth services by
the receiving hospital, with the distribution of funding to be
established by rule.
(p) For calendar year 2023, the final amounts, rates, and
payments under subsections (c), (d-2), (g), (h), and (j) shall
be established by the Department, so that the sum of the total
estimated annual payments under subsections (c), (d-2), (g),
(h), and (j) for each hospital class for calendar year 2023, is
no less than:

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(1) $858,260,000 to safety-net hospitals.
(2) $86,200,000 to critical access hospitals.
(3) $1,765,000,000 to high Medicaid hospitals.
(4) $673,860,000 to general acute care hospitals.
(5) $48,330,000 to long term acute care hospitals.
(6) $89,110,000 to freestanding psychiatric hospitals.
(7) $24,300,000 to freestanding rehabilitation
hospitals.
(8) $32,570,000 to public hospitals.
(q) Hospital Pandemic Recovery Stabilization Payments. The
Department shall disburse a pool of $460,000,000 in stability
payments to hospitals prior to April 1, 2023. The allocation
of the pool shall be based on the hospital directed payment
classes and directed payments issued, during Calendar Year
2022 with added consideration to safety net hospitals, as
defined in subdivision (f)(1)(B) of this Section, and critical
access hospitals.
(Source: P.A. 102-4, eff. 4-27-21; 102-16, eff. 6-17-21;
102-886, eff. 5-17-22; 102-1115, eff. 1-9-23; 103-102, eff.
6-16-23; 103-593, eff. 6-7-24; 103-605, eff. 7-1-24.)