Vitale, Ruiz Bill to Increase Medicaid Resources Clears Senate

TRENTON – Legislation sponsored by Senate Health, Human Services and Senior Citizens Committee Chair Joseph F. Vitale and Senator M. Teresa Ruiz that would increase resources provided through Medicaid, and would establish county option hospital fee pilot program cleared the Senate today.

“While Medicaid is the safety net that prevents low-income New Jerseyans from falling through the cracks, county hospitals need to be well-funded and supported to properly deliver expert care to the community they serve,” said Senator Vitale (D-Middlesex). “This pilot program will expand the resources for Medicaid and funnel funds into those facilities that ensure the disadvantaged continue to receive the quality care they need.”

“Piloting this fee will allow us to explore the impact increased revenue for Medicaid can have on low income individuals around the state” said Senator Ruiz (D-Essex). “Medicaid is essential to the health of our disadvantaged communities, and this will help ensure they have access to the resources and care they need.”

This bill, S-2758, would establish a five-year County Option Hospital Fee Pilot Program in the Department of Human Services. The program would increase financial resources through the Medicaid program to support local hospitals and ensure that they continue to provide necessary services to low-income individuals. It would also provide participating counties with new fiscal resources.

The Commissioner of Human Services would authorize a maximum of seven counties to participate in the pilot program, and counties would have to meet certain qualifications to be considered eligible.

Counties interested would submit a report to the commissioner that would include the proposed fee and the expenditure plan. The commissioner would make the plan available to affected hospitals and they would have 21 days to comment on the plan.

The board of chosen freeholders, following the approval of the plan, could adopt an ordinance that would provide for the imposition of the fee. The county could exempt a hospital within its jurisdiction from the fee.

A participating county could transfer funds collected to the commissioner, who would then use the funds, along with any other federal funds generated therefrom, to increase Medicaid payments to its hospitals. The county could also retain the funds collected from the imposition of the fee, as well as the federal funds acquired through it, and use the funding to satisfy the purposes of the pilot program.

At least 75 percent of the funds collected from the imposition of the fee would have to be used to benefit local hospitals or local hospital-related providers within the county’s borders.

Hospitals subject to the fee would not be able to pass on the cost of the fee to any other party, or list it separately on any invoice or statement sent to any responsible party. No management care organization operating in the state would be authorized to retain any fund generated by the fee other than to offset increased administrative costs incurred as a result of the program.

Funds generated would not supplant or offset any current or future state funds allocated to a participating county. Payments distributed to hospitals pursuant to the bill would not supplant or offset any current or future funds paid to hospitals through other state or federal funding mechanisms or pools.

The bill would take effect immediately, subject to such actions by the federal government as are necessary to effectuate the purpose of the bill, and would expire five years after the effective date.

The bill was approved 21-16.