Outside Section 23

Assessments on Managed Care Organizations

SECTION 23.   (A) Section 34 of chapter 118G of the General Laws, as appearing in the 2008 Official Edition, is hereby amended by inserting after the definition of "Health services" the following definition:- "Managed Care Organization", any managed care organization as defined by 42 CFR 438.2 and any eligible health insurance plan as defined by section 1 of chapter 118H, that contracts with MassHealth or the commonwealth health connector authority; but the term shall not include any senior care organization as defined by section 9D of chapter 118E.

(B) The definition of "Payments subject to surcharge" in said section 34 of said chapter 118G, as so appearing, is hereby amended by adding the following sentence:- But the term shall include payments made by a managed care organization on behalf of (a) Medicaid recipients under age 65, and (b) enrollees in the commonwealth care health insurance program.

(C) The definition of "Surcharge payor" in said section 34 of said chapter 118G, as so appearing, is hereby amended by adding the following sentence:- But the term shall include managed care organizations.

(D) Subsection (a) of section 36 of said chapter 118G, as so appearing, is hereby amended by striking out the third sentence and inserting in place thereof the following sentence:- The purposes of the fund shall be: (i) to maintain a health care safety net by reimbursing hospitals and community health centers for a portion of the cost of reimbursable health services provided to low-income, uninsured or underinsured residents of the commonwealth; and (ii) to support a portion of the costs of the Medicaid program under chapter 118E and the commonwealth care health insurance program under chapter 118H.

(E) Said section 36 of said chapter 118G, as so appearing, is hereby further amended by inserting after the word "hospitals", in line 29, the following words:- ; and provided further, that any amounts collected from surcharge payors in any year in excess of $160,000,000, adjusted to reflect applicable surcharge credits, shall be transferred to the General Fund to support a portion of the costs of the Medicaid and commonwealth care health insurance programs.

(F) Section 38 of said chapter 118G, as so appearing, is hereby amended by striking out the third and fourth sentences and inserting in place thereof the following 2 sentences:- The office shall calculate the surcharge percentage by dividing $160,000,000 by the projected annual aggregate payments subject to the surcharge, excluding projected annual aggregate payments based on payments made by managed care organizations. The office shall determine the surcharge percentage before the start of each fund fiscal year and may redetermine the surcharge percentage before April 1 of each fund fiscal year if the office projects that the initial surcharge percentage established the previous October will produce less than $150,000,000 or more than $170,000,000 in surcharge payments excluding payments made by managed care organizations.
 
 

Summary:
This section includes managed care organizations among the health care providers whose payments are subject to a state surcharge, and uses the proceeds to help support the Medicaid and Commonwealth Care programs.