Bill Text: IL SB3374 | 2023-2024 | 103rd General Assembly | Introduced

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Bill Title: Amends the Medical Assistance Article of the Illinois Public Aid Code. Requires the Department of Healthcare and Family Services to by rule implement a methodology to reimburse hospitals for inpatient stays extended beyond medical necessity due to the inability of the Department, the managed care organization (MCO) in which a medical assistance recipient is enrolled in, or the hospital discharge planner to find an appropriate placement after discharge from the hospital to the next level of care. Requires the Department to by rule implement a methodology effective for dates of service January 1, 2025 and later to reimburse hospitals for emergency department stays extended beyond medical necessity due to the inability of the Department, the MCO, or the hospital discharge planner to find an appropriate placement after discharge from the hospital setting to the next appropriate level of care. Provides that both methodologies shall provide reasonable compensation for the services provided attributable to the hours of the extended stay for which the prevailing rate methodology provides no reimbursement. Contains provisions concerning the rate for inpatient days of care; hourly rates of reimbursement for emergency department stays; a prohibition on MCOs restricting coverage due to delays caused by the Department or the MCOs in completing the pre-admission screening and resident review process; a prohibition on MCOs imposing authorization or documentation requirements and other conditions of reimbursement that are more restrictive than standards under the fee-for-service medical assistance program; sanctions on MCOs for noncompliance; and administrative rules. Effective immediately.

Spectrum: Partisan Bill (Democrat 2-0)

Status: (Introduced) 2024-05-14 - Added as Co-Sponsor Sen. Robert Peters [SB3374 Detail]

Download: Illinois-2023-SB3374-Introduced.html

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103RD GENERAL ASSEMBLY State of Illinois 2023 and 2024 SB3374 Introduced 2/7/2024, by Sen. Ann Gillespie SYNOPSIS AS INTRODUCED:
305 ILCS 5/14-13
Amends the Medical Assistance Article of the Illinois Public Aid Code. Requires the Department of Healthcare and Family Services to by rule implement a methodology to reimburse hospitals for inpatient stays extended beyond medical necessity due to the inability of the Department, the managed care organization (MCO) in which a medical assistance recipient is enrolled in, or the hospital discharge planner to find an appropriate placement after discharge from the hospital to the next level of care. Requires the Department to by rule implement a methodology effective for dates of service January 1, 2025 and later to reimburse hospitals for emergency department stays extended beyond medical necessity due to the inability of the Department, the MCO, or the hospital discharge planner to find an appropriate placement after discharge from the hospital setting to the next appropriate level of care. Provides that both methodologies shall provide reasonable compensation for the services provided attributable to the hours of the extended stay for which the prevailing rate methodology provides no reimbursement. Contains provisions concerning the rate for inpatient days of care; hourly rates of reimbursement for emergency department stays; a prohibition on MCOs restricting coverage due to delays caused by the Department or the MCOs in completing the pre-admission screening and resident review process; a prohibition on MCOs imposing authorization or documentation requirements and other conditions of reimbursement that are more restrictive than standards under the fee-for-service medical assistance program; sanctions on MCOs for noncompliance; and administrative rules. Effective immediately.
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A BILL FOR
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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 14-13 as follows:
(305 ILCS 5/14-13)
Sec. 14-13. Reimbursement for hospital inpatient stays
extended beyond medical necessity.
(a) The By October 1, 2019, the Department shall by rule
implement a methodology effective for dates of service July 1,
2019 and later to reimburse hospitals for inpatient stays
extended beyond medical necessity due to the inability of the
Department or the managed care organization in which a
recipient is enrolled or the hospital discharge planner to
find an appropriate placement after discharge from the
hospital to the next level of care, including, but not limited
to, care provided in a nursing facility, ICF/DD facility,
MC/DD facility, rehabilitation hospital or rehabilitation
unit, psychiatric hospital or psychiatric unit, long-term
acute care hospital, long-term services and supports waiver
setting, residence when home health care services are
required, or other post-acute or sub-acute care setting. The
Department shall evaluate the effectiveness of the current

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reimbursement rate for inpatient hospital stays beyond medical
necessity.
(a-2) By October 1, 2024, the Department shall by rule
implement a methodology effective for dates of service January
1, 2025 and later to reimburse hospitals for emergency
department stays extended beyond medical necessity due to the
inability of the Department or the managed care organization
in which a recipient is enrolled or the hospital discharge
planner to find an appropriate placement after discharge from
the hospital setting to the next appropriate level of care,
including, but not limited to, care provided in a nursing
facility, ICF/DD facility, MC/DD facility, rehabilitation
hospital or rehabilitation unit, psychiatric hospital or
psychiatric unit, long-term acute care hospital, long-term
services and supports waiver setting, residence when home
health care services are required, or other post-acute or
sub-acute care setting.
(b) The methodology developed under subsection (a) shall
provide reasonable compensation for the services provided
attributable to the days of the extended stay for which the
prevailing rate methodology provides no reimbursement. The
Department may use a day outlier program to satisfy this
requirement. The methodology developed under subsection (a-2)
shall provide reasonable compensation for the services
provided attributable to the hours of the extended stay for
which the prevailing rate methodology provides no

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reimbursement. The reimbursement rate shall be set at a level
so as not to act as an incentive to avoid transfer to the
appropriate level of care needed or placement, after
discharge.
(b-5) Effective January 1, 2025, the Department shall set
the rate for inpatient days of care, referenced in subsection
(a), equal to the statewide average rate paid per day
including Medicaid High Volume Adjustment (MHVA) and the
Medicaid Percentage Adjustment (MPA), for inpatient services,
specific to each category of services, provided by all
Illinois hospitals, based on dates of service in State Fiscal
Year 2023. Effective January 1, 2026, the Department shall
update this rate for dates of service on or after January 1 of
each calendar year, based on dates of service from the State
fiscal year ending 18 months before the beginning of the new
calendar year.
(b-6) Effective January 1, 2025, and each January 1
thereafter, the Department shall set the hourly rate of
reimbursement for emergency department stays, referenced
subsection (a-2), equal to the inpatient rate established in
subsection (b-5) divided by 24, and shall pay for each hour the
patient is unable to be transferred to the next appropriate
level of care. Effective January 1, 2026, the Department shall
update this rate for dates of service on or after January 1 of
each calendar year, coinciding with the update required in
subsection (b-5).

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(c) For recipients who require a level of care described
in subsection (a) and subsection (a-2), the The Department
shall require managed care organizations to adopt this
methodology or an alternative methodology that pays at least
as much as the Department's adopted methodology unless
otherwise mutually agreed upon contractual language is
developed by the provider and the managed care organization
for a risk-based or innovative payment methodology.
(d) Days beyond medical necessity shall not be separately
eligible for per diem add-on payments under the MHVA or MPA
Medicaid High Volume Adjustment (MHVA) or the Medicaid
Percentage Adjustment (MPA) programs.
(e) For services covered by the fee-for-service program,
reimbursement under this Section shall only be made for stays
days beyond medical necessity that occur after the hospital
has notified the Department of the need for post-discharge
placement. The Department shall not restrict coverage under
this Section due to delays caused by the Department, or its
designated contractor, in completing the Pre-Admission
Screening and Resident Review process.
(f) For services covered by a managed care organization,
hospitals shall notify the appropriate managed care
organization of an admission within 24 hours of admission. For
every 24-hour period beyond the initial 24 hours after
admission that the hospital fails to notify the managed care
organization of the admission, reimbursement under this

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subsection shall be reduced by one day. Managed care
organizations (MCOs) shall not restrict coverage under this
Section due to delays caused by:
(1) The MCO or its designated contractor, or the
Department or its designated contractor, in completing the
Pre-Admission Screening and Resident Review process.
(2) Processing authorization requests, as submitted by
the provider, for post-acute care for enrollees who are
approved for discharge, including, but not limited to any
MCO action to extend the timeframe for issuing a
determination by changing the provider's request from
urgent to routine.
(g) The Department shall, by contract, prohibit the MCOs
from imposing authorization or documentation requirements,
exclusionary criteria, or other conditions of reimbursement
that are more restrictive than the standards adopted by the
Department for the fee-for-service program.
(h) The Department shall impose sanctions on an MCO for
violating provisions of this Section, including, but not
limited to, financial penalties, suspension of enrollment, or
termination of the MCO's contract with the Department.
(i) The Department shall adopt or amend administrative
rules, as necessary, to implement the provisions of this
Section.
(Source: P.A. 101-209, eff. 8-5-19; 102-4, eff. 4-27-21.)
Section 99. Effective date. This Act takes effect upon

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