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Budget Summary FY2009

Outside Section 88
Data Current as of:  6/22/2009




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Health Safety Net Trust Fund to Hospitals and Community Health Centers

SECTION 88.   (a) Notwithstanding any general or special law to the contrary, on or before October 1, 2008 and without further appropriation, the comptroller shall transfer from the General Fund to the Health Safety Net Trust Fund, established pursuant to section 36 of chapter 118G of the General Laws and in this subsection referred to as the fund, the greater of $45,000,000 or one-twelfth of the total expenditures to hospitals and community health centers required pursuant to subsection (b), for the purpose of making initial gross payments to qualifying acute care hospitals for the hospital fiscal year beginning October 1, 2008. These payments shall be made to hospitals before, and in anticipation of, the payment by hospitals of their gross liability to the fund. The comptroller shall transfer from the fund to the General Fund not later than June 30, 2009, the amount of the transfer authorized by this subsection and any allocation thereof as certified by the director of the health safety net office.

(b) Notwithstanding any general or special law to the contrary, the comptroller shall, in consultation with the state treasurer, the secretary of administration and finance and the secretary of health and human services, develop a schedule for transferring funds among the General Fund, the Commonwealth Care Trust Fund established pursuant to section 2OOO of chapter 29 of the General Laws, and the Health Safety Net Trust Fund established pursuant to section 36 of chapter 118G of the General Laws. Not less than $1,117,561,456 shall be transferred from the General Fund to the Commonwealth Care Trust Fund and not less than $62,996,382 shall be transferred from the Commonwealth Care Trust Fund to the Health Safety Net Trust Fund. The hospital fiscal year 2009 payment amount to each hospital shall be funded by the Health Safety Net Trust Fund. Payments may be made either as safety net care payments under the Commonwealth's 1115 waiver, or as an adjustment to Title XIX service rate payments, or a combination thereof. The executive office of health and human services and the health safety net office may use other federally permissible funding mechanisms available for public service hospitals, as defined in 114.1 CMR 36.02, to reimburse up to $70,000,000 of uncompensated care at the hospitals using sources distinct from the funding made available to the Health Safety Net Trust Fund. The executive office of health and human services shall make expenditures required for fiscal year 2009 under section 122 of chapter 58 of the acts of 2006. The schedule shall provide for transfers in increments considered appropriate to meet the cash flow needs of these funds. The transfers shall not begin before July 1, 2008 and shall be completed on or before June 30, 2009. The secretary of administration and finance, in consultation with the secretary of health and human services and the executive director of the commonwealth health insurance connector, shall on a quarterly basis evaluate the revenue needs of the health safety net program funded by the Health Safety Net Trust Fund and the Commonwealth Care subsidized health insurance program funded from the Commonwealth Care Trust Fund, and if necessary, transfer monies between these funds for the purpose of ensuring that sufficient revenues are available to support projected program expenditures. The secretary of health and human services in consultation with the secretary of administration and finance and the executive director of the commonwealth health insurance connector shall submit a quarterly report to the house and senate committees on ways and means and joint committee on healthcare financing which shall include, but not be limited to, the projected and actual expenditures and revenues for the Commonwealth Care Trust Fund and any transfers made between the Health Safety Net Trust Fund and the Commonwealth Care Trust Fund.

(c) Notwithstanding any general or special law to the contrary, the comptroller shall, in consultation with the office of the state treasurer, the executive office of administration and finance and the executive office of health and human services, develop a schedule and make a series of transfers not to exceed $346,000,000 from the General Fund to the MassHealth provider payment account in the Medical Assistance Trust Fund, established pursuant to section 2QQQ of chapter 29 of the General Laws, if the comptroller has determined that General Fund revenues are sufficient to accommodate the schedule of transfers. These funds may be expended only for services provided during state or federal fiscal year 2009, and no amounts previously or subsequently transferred into the Medical Assistance Trust Fund may be expended on payments described in the 1115 demonstration waiver for services provided during state fiscal year 2009 or payments described in the state plan for services provided during federal fiscal year 2009. All payments from the Medical Assistance Trust Fund shall be subject to the availability of federal financial participation, shall be made only in accordance with federally-approved payment methods, shall be consistent with federal funding requirements and all federal payment limits as determined by the secretary of health and human services, and shall be subject to the terms and conditions of an agreement with the executive office of health and human services. Any increase in payment made from the trust fund totaling an amount greater than $251,000,000 in fiscal year 2009 shall be made only after the secretary of health and human services certifies that any increase in payments from the trust fund shall not exceed the negotiated limit for section 1115 waiver spending. The secretary of health and human services shall notify, in writing, the house and senate committees on ways and means and the house and the joint committee on healthcare financing for any increases in payments within 15 days. The secretary of the executive office of health and human services shall make a payment of up to $148,000,000 from the Medical Assistance Trust Fund to the Cambridge public health commission's hospital network for dates of service in state and federal fiscal year 2009 only after the Cambridge public health commission transfers up to $74,000,000 of its funds to the Medical Assistance Trust Fund, using a federally permissible source of funds which shall fully satisfy the non-federal share of such payment.

(d) Notwithstanding any general or special law to the contrary, the comptroller, in consultation with the secretary of health and human services, shall develop a schedule for transferring not less than $25,000,000 from the General Fund to the Essential Community Provider Trust Fund, established in section 2PPP of chapter 29 of the General Laws, for the purpose of making expenditures as described in this section in fiscal year 2009. The secretary shall authorize expenditures from the fund without further appropriation to improve and enhance the ability of hospitals and community health centers to serve populations in need, more efficiently and effectively, including, but not limited to, the ability to provide community-based care, clinical support, care coordination services, disease management services, primary care services and pharmacy management services. The office shall consider applications from acute hospitals, non-acute hospitals, and community health centers; provided, however, that the office shall publicize the existence of the program to eligible providers. The eligibility criteria for providers to receive funds shall include, but not be limited to, the following: (i) financial performance measures including negative operating margins, insufficient cash flow, technical bond default and the uncertain ability to cover long-term obligations, as well as potential for loss of critical community services; (ii) the percentage of patients with mental or substance abuse disorders served by a provider; (iii) the numbers of patients served by a provider who are chronically ill, elderly, or disabled, provided that in the case of a community health center, that preference be given to the provision of a program of all-inclusive care for the elderly; (iv) the payer mix of the provider, with preference given to acute hospitals where a minimum of 63 per cent of the acute hospital's gross patient service revenue is attributable to Title XVIII and Title XIX of the federal Social Security Act or other governmental payors, including reimbursements from the Health Safety Net Trust Fund; (v) the percentage of total annual operating revenue that received funding in fiscal years 2005 and 2006 from the Distressed Provider Expendable Trust Fund comprised for the provider; (vi) the percentage of total annual operating revenue that received funding in fiscal year 2008 from the Essential Community Provider Trust Fund, established in section 2PPP of chapter 29 of the General Laws; (vii) the cultural and linguistic challenges presented by the populations served by the provider; (viii) a documented critical need for investment in information technology such as computerized physician order entry systems but without access to capital to finance such investments; and (ix) the provision by a community health center of 24 hour emergency services. The secretary may further authorize distributions on an emergency basis to acute hospitals, non-acute hospitals and community health centers facing extreme financial distress or closure upon petition from the provider. The emergency funds shall be distributed by the secretary within 14 days of petition by a provider that is determined to be facing extreme financial distress or closure at an amount determined by the secretary. The executive office of health and human services shall structure expenditures under this section to maximize allowable federal reimbursement under Title XIX. The secretary of health and human services shall file with the house and senate committees on ways and means on or before September 15, 2008, a distribution plan for the funds, and the extent to which expenditures qualify for federal financial participation. The maximum expenditure from this fund shall not exceed $37,500,000. Any additional funds shall be deposited in the General Fund.