Pennsylvania Act 2004-69 — PUBLIC WELFARE CODE - MEDICAID MANAGED CARE ORGANIZATION ASSESSMENTS AND INTERMEDIATE CARE FACILITIES FOR MENTALLY RETARDED PERSONS ASSESSMENTS

Act text

PUBLIC WELFARE CODE - MEDICAID MANAGED CARE ORGANIZATION ASSESSMENTS AND
  INTERMEDIATE CARE FACILITIES FOR MENTALLY RETARDED PERSONS ASSESSMENTS
                  Act of Jul. 4, 2004, P.L. 528, No. 69               Cl. 67
                             Session of 2004
                               No. 2004-69

     HB 1039

                                  AN ACT

     Amending the act of June 13, 1967 (P.L.31, No.21), entitled "An
        act to consolidate, editorially revise, and codify the public
        welfare laws of the Commonwealth," providing for Medicaid
        managed care organization assessments, for intermediate care
        facilities for the mentally retarded persons assessments, for
        administration of assessments by the Department of Public
        Welfare, for enforcement and for a report on certain
        pharmaceutical programs.

        The General Assembly of the Commonwealth of Pennsylvania
     hereby enacts as follows:

        Section 1.  The act of June 13, 1967 (P.L.31, No.21), known
     as the Public Welfare Code, is amended by adding articles to
     read:
                              ARTICLE VIII-B
              MEDICAID MANAGED CARE ORGANIZATION ASSESSMENTS
      Section 801-B.  Definitions.
        The following words and phrases when used in this article
     shall have the meanings given to them in this section unless the
     context clearly indicates otherwise:
        "Assessment percentage."  The rate assessed pursuant to this
     article on every Medicaid managed care organization.
        "Assessment period."  The time period identified in the
     contract.
        "Assessment proceeds."  The State revenue collected from the
     assessment provided for in this article, any Federal funds
     received by the Commonwealth as a direct result of the
     assessment and any penalties and interest received under section
     810-B.
        "Contract."  The agreement between a Medicaid managed care
     organization and the Department of Public Welfare.
        "County Medicaid managed care organization."  A county, or an
     entity organized and controlled directly or indirectly by a
     county or a city of the first class, that is a party to a
     Medicaid managed care contract with the Department of Public
     Welfare.
        "Department."  The Department of Public Welfare of the
     Commonwealth.
        "Medicaid."  The program established under Title XIX of the
     Social Security Act (49 Stat. 620, 42 U.S.C. § 1396 et seq.).
        "Medicaid managed care organization."  A Medicaid managed
     care organization as defined in section 1903(m)(1)(A) of the
     Social Security Act (49 Stat. 620, 42 U.S.C. § 1396b(m)(1)(A))
     that is a party to a Medicaid managed care contract with the
     Department of Public Welfare. The term shall include a county
     Medicaid managed care organization and a permitted assignee of a
     Medicaid managed care contract but shall not include an assignor
     of a Medicaid managed care contract.
        "Secretary."  The Secretary of Public Welfare of the
     Commonwealth.
        "Social Security Act."  49 Stat. 620, 42 U.S.C. § 301 et
     seq.)
      Section 802-B.  Authorization.
        The department shall implement an assessment on each Medicaid
     managed care organization, subject to the conditions and
     requirements specified in this article.
      Section 803-B.  Implementation.
        The assessment shall be implemented on an annual basis,
     through periodic submissions not to exceed five times per year
     by Medicaid managed care organizations, as a health care-related
     fee as defined in section 1903(w)(3)(B) of the Social Security
     Act, or any amendments thereto, and may be imposed and is
     required to be paid only to the extent that the revenues
     generated from the assessment qualify as the State share of
     program expenditures eligible for Federal financial
     participation.
      Section 804-B.  Assessment percentage.
        (a)  Amount.--The assessment percentage shall be uniform for
     all Medicaid managed care organizations, determined in
     accordance with this section and implemented by the department
     as approved by the Governor after notification to and in
     consultation with the Medicaid managed care organizations. The
     assessment percentage shall be subject to the maximum aggregate
     amount that may be assessed pursuant to 42 CFR 433.68(f)(3)(i)
     (relating to permissible health care-related taxes after the
     transition period) or any subsequent maximum established by
     Federal law.
        (b)  Notice.--Subject to the provisions of subsection (c),
     the department shall notify each Medicaid managed care
     organization of a proposed assessment percentage. Medicaid
     managed care organizations shall have 30 days from the date of
     the proposed assessment percentage notice to provide written
     comments to the department regarding the proposed assessment.
     Upon expiration of the 30-day comment period, the department,
     after consideration of the comments, shall provide each Medicaid
     managed care organization with a second notice announcing the
     assessment percentage. Once effective, an assessment percentage
     will remain in effect until the department notifies each
     Medicaid managed care organization of a new assessment
     percentage in accordance with the notice provisions contained in
     this section.
        (c)  Initial assessment.--The initial assessment percentage
     may be imposed retroactively to the beginning of an assessment
     period beginning on or after July 1, 2004. Once effective, the
     initial assessment percentage will remain in effect until the
     department notifies each Medicaid managed care organization of a
     new assessment percentage in accordance with the notice
     provisions contained in this section.
      Section 805-B.  Calculation and payment.
        Using the assessment percentage established under section
     804-B, each Medicaid managed care organization shall calculate
     the assessment amount for each assessment period on a report
     form specified by the contract and shall submit the completed
     report form and total amount owed to the department on a due
     date specified by the contract. The Medicaid managed care
     organization shall report net operating revenue for purposes of
     the assessment calculation as specified in the contract.
      Section 806-B.  Use of assessment proceeds.
        No Medicaid managed care organization shall be guaranteed a
     repayment of its assessment in derogation of 42 CFR 433.68(f),
     provided, however, in each fiscal year in which an assessment is
     implemented, the department shall use the assessment proceeds to
     maintain actuarially sound rates as defined in the contract for
     the Medicaid managed care organizations to the extent
     permissible under Federal and State law or regulation and
     without creating a guarantee to hold harmless, as those terms
     are used in 42 CFR 433.68(f) (relating to permissible health
     care-related taxes after the transition period).
      Section 807-B.  Records.
        Upon written request by the department, a Medicaid managed
     care organization shall furnish to the department such records
     as the department may specify in order to determine the amount
     of assessment due from the Medicaid managed care organization or
     to verify that the Medicaid managed care organization has
     calculated and paid the correct amount due. The requested
     records shall be provided to the department within 30 days from
     the date of the Medicaid managed care organization's receipt of
     the written request unless required at an earlier date for
     purposes of the department's compliance with a request from a
     Federal or another State agency.
      Section 808-B.  Payment of assessment.
        In the event that the department determines that a Medicaid
     managed care organization has failed to pay an assessment or
     that it has underpaid an assessment, the department shall
     provide written notification to the Medicaid managed care
     organization within 180 days of the original due date of the
     amount due, including interest, and the date on which the amount
     due must be paid, which shall not be less than 30 days from the
     date of the notice. In the event that the department determines
     that a Medicaid managed care organization has overpaid an
     assessment, the department shall notify the Medicaid managed
     care organization in writing of the overpayment, and, within 30
     days of the date of the notice of the overpayment, the Medicaid
     managed care organization shall advise the department to either
     authorize a refund of the amount of the overpayment or offset
     the amount of the overpayment against any amount that may be
     owed to the department by the Medicaid managed care
     organization.
      Section 809-B.  Appeal rights.
        A Medicaid managed care organization that is aggrieved by a
     determination of the department relating to the assessment may
     file a request for review of the decision of the department by
     the Bureau of Hearings and Appeals within the department, which
     shall have exclusive primary jurisdiction in such matters. The
     procedures and requirements of 67 Pa.C.S. Ch. 11 (relating to
     medical assistance hearings and appeals) shall apply to requests
     for review filed pursuant to this section except that, in any
     such request for review, a Medicaid managed care organization
     may not challenge the assessment percentage determined by the
     department pursuant to section 804-B.
      Section 810-B.  Enforcement.
        In addition to any other remedy provided by law, the
     department may enforce this article by imposing one or more of
     the following remedies:
            (1)  When a Medicaid managed care organization fails to
        pay an assessment or penalty in the amount or on the date
        required by this article, the department may add interest at
        the rate provided in section 806 of the act of April 9, 1929
        (P.L.343, No.176), known as The Fiscal Code, to the unpaid
        amount of the assessment or penalty from the date prescribed
        for its payment until the date it is paid.
            (2)  When a Medicaid managed care organization fails to
        submit a report form concerning the calculation of the
        assessment or to furnish records to the department as
        required by this article, the department may impose a penalty
        against the Medicaid managed care organization in the amount
        of $1,000 per day for each day the report form or required
        records are not submitted or furnished to the department. If
        the $1,000 per day penalty is imposed, it shall commence on
        the first day after the date for which a report form or
        records are due.
            (3)  When a Medicaid managed care organization fails to
        pay all or part of an assessment or penalty within 30 days of
        the date that payment is due, the department may deduct the
        unpaid assessment or penalty and any interest owed from any
        capitation payments due to the Medicaid managed care
        organization until the full amount is recovered. Any
        deduction shall be made only after written notice to the
        Medicaid managed care organization.
            (4)  Upon written request by a Medicaid managed care
        organization to the secretary, the secretary may waive all or
        part of the interest or penalties assessed against a Medicaid
        managed care organization pursuant to this article for good
        cause as shown by the Medicaid managed care organization.
      Section 811-B.  Time periods.
        The assessment authorized in this article shall not be
     imposed or paid prior to July 1, 2004, or in the absence of
     Federal financial participation as described in section 803-B.
     The assessment shall cease on June 30, 2008, or earlier if
     required by law.
                              ARTICLE VIII-C
        INTERMEDIATE CARE FACILITIES FOR MENTALLY RETARDED PERSONS
                               ASSESSMENTS
      Section 801-C.  Definitions.
        The following words and phrases when used in this article
     shall have the meanings given to them in this section unless the
     context clearly indicates otherwise:
        "Assessment."  The fee implemented pursuant to this article
     on every intermediate care facility for mentally retarded
     persons.
        "Department."  The Department of Public Welfare of the
     Commonwealth.
        "Intermediate care facility for mentally retarded persons" or
     "ICF/MR."  A public or private facility defined in section 1905
     of the Social Security Act (49 Stat. 620, 42 U.S.C. § 1905).
        "Medicaid."  The program established under Title XIX of the
     Social Security Act (49 Stat. 620, 42 U.S.C. § 1396 et seq.).
        "Medical assistance program" or "program."  The medical
     assistance program as administered by the Department of Public
     Welfare.
        "Secretary."  The Secretary of Public Welfare of the
     Commonwealth.
        "Social Security Act."  49 Stat. 620, 42 U.S.C. § 301 et seq.
      Section 802-C.  Authorization.
        In order to generate additional revenues for medical
     assistance program recipients to have access to medically
     necessary mental retardation services, the department shall
     implement a monetary assessment on each ICF/MR subject to the
     conditions and requirements specified in this article.
      Section 803-C.  Implementation.
        The ICF/MR assessments shall be implemented on an annual
     basis as a health care-related tax as defined in section
     1903(w)(3)(B) of the Social Security Act, or any amendments
     thereto, and may be imposed and is required to be paid only to
     the extent that the revenues generated from the assessment will
     qualify as the State share of program expenditures eligible for
     Federal financial participation.
      Section 804-C.  Amount.
        The assessment rate shall be determined in accordance with
     this article and implemented on an annual basis by the
     department, as approved by the Governor, upon notification to
     and in consultation with the ICFs/MR. In each year in which the
     assessment is implemented, the assessment rate shall equal the
     amount established by the department subject to the maximum
     aggregate amount that may be assessed pursuant to the 6%
     indirect guarantee threshold set forth in 42 CFR 433.68(f)(3)(i)
     (relating to permissible health care-related taxes after the
     transition period) or any other maximum aggregate amount
     established by law.
      Section 805-C.  Administration.
        (a)  Notice of assessment.--The secretary, before
     implementing an assessment in any fiscal year, shall publish a
     notice in the Pennsylvania Bulletin that specifies the amount of
     the assessment being proposed and an explanation of the
     assessment methodology and amount determination that identifies
     the aggregate impact on ICFs/MR subject to the assessment.
     Interested parties shall have 30 days in which to submit
     comments to the secretary. Upon expiration of the 30-day comment
     period, the secretary, after consideration of the comments,
     shall publish a second notice in the Pennsylvania Bulletin
     announcing the rate of the assessment.
        (b)  Review of assessment.--Except as permitted under section
     809-C, the secretary's determination of the aggregate amount and
     the rate of the assessment pursuant to subsection (a) shall not
     be subject to administrative or judicial review under 2 Pa.C.S.
     Chs. 5 Subch. A (relating to practice and procedure of
     Commonwealth agencies) and 7 Subch. A (relating to judicial
     review of Commonwealth agency action) or any other provision of
     law. No assessment implemented under this article nor forms or
     reports required to be completed by ICFs/MR pursuant to this
     article shall be subject to the act of July 31, 1968 (P.L.769,
     No.240), referred to as the Commonwealth Documents Law, the act
     of October 15, 1980 (P.L.950, No.164), known as the Commonwealth
     Attorneys Act, or the act of June 25, 1982 (P.L.633, No.181),
     known as the Regulatory Review Act.
      Section 806-C.  Calculation.
        Using the assessment rate implemented by the secretary
     pursuant to section 804-C, each ICF/MR shall calculate the
     assessment amounts it owes for a calendar quarter on a form
     specified by the department and shall submit the form and the
     amount owed to the department no later than the last day of that
     calendar quarter or 30 days from the date of the department's
     second notice published pursuant to section 805-C(a), whichever
     is later.
      Section 807-C.  Purposes and uses.
        No ICF/MR shall be directly guaranteed a repayment of its
     assessment in derogation of 42 CFR 433.68 (relating to
     permissible health care-related taxes after the transition
     period), provided, however, in each fiscal year in which an
     assessment is implemented, the department shall use the State
     revenue collected from the assessment and any Federal funds
     received by the Commonwealth as a direct result of the
     assessment to fund services for persons with mental retardation.
      Section 808-C.  Records.
        Upon request by the department, an ICF/MR shall furnish to
     the department such records as the department may specify in
     order to determine the assessment rate for a fiscal year or the
     amount of the assessment due from the ICF/MR or to verify that
     the ICF/MR has paid the correct amount due. In the event that
     the department determines that an ICF/MR has failed to pay an
     assessment or that it has underpaid an assessment, the
     department shall notify the ICF/MR in writing of the amount due,
     including interest, and the date on which the amount due must be
     paid, which shall not be less than 30 days from the date of the
     notice. In the event that the department determines that an
     ICF/MR has overpaid an assessment, the department shall notify
     the ICF/MR in writing of the overpayment and, within 30 days of
     the date of the notice of the overpayment, shall either
     authorize a refund of the amount of the overpayment or offset
     the amount of the overpayment against any amount that may be
     owed to the department by the ICF/MR.
      Section 809-C.  Appeal rights.
        An ICF/MR that is aggrieved by a determination of the
     department as to the amount of the assessment due from the
     ICF/MR or a remedy imposed pursuant to section 810-C may file a
     request for review of the decision of the department by the
     Bureau of Hearings and Appeals within the department, which
     shall have exclusive jurisdiction in such matters. The
     procedures and requirements of 67 Pa.C.S. Ch. 11 (relating to
     medical assistance hearings and appeals) shall apply to requests
     for review filed pursuant to this section except that, in any
     such request for review, an ICF/MR may not challenge the
     assessment rate determined by the secretary, but only whether
     the department correctly determined the assessment amount due
     from the ICF/MR using the assessment rate in effect for the
     fiscal year.
      Section 810-C.  Enforcement.
        In addition to any other remedy provided by law, the
     department may enforce this article by imposing one or more of
     the following remedies:
            (1)  When an ICF/MR fails to pay an assessment or penalty
        in the amount or on the date required by this article, the
        department may add interest at the rate provided in section
        806 of the act of April 9, 1929 (P.L.343, No.176), known as
        The Fiscal Code, to the unpaid amount of the assessment or
        penalty from the date prescribed for its payment until the
        date it is paid.
            (2)  When an ICF/MR fails to file a report or to furnish
        records to the department as required by this article, the
        department may impose a penalty against the ICF/MR in the
        amount of $1,000 per day for each day the report or required
        records are not filed or furnished to the department.
            (3)  When an ICF/MR fails to pay all or part of an
        assessment or penalty within 60 days of the date that payment
        is due, the department may terminate the ICF/MR from
        participation in the medical assistance program and/or deduct
        the unpaid assessment or penalty and any interest owed
        thereon from any payments due to the ICF/MR until the full
        amount is recovered. Any such termination or payment
        deduction shall be made only after written notice to the
        ICF/MR.
            (4)  The secretary may waive all or part of the interest
        or penalties assessed against an ICF/MR pursuant to this
        article for good cause as shown by the ICF/MR.
      Section 811-C.  Time periods.
        The assessment authorized in this article shall not be
     imposed prior to July 1, 2003, and shall cease on June 30, 2009,
     or earlier if required by law.
        Section 2.  Within one year of the effective date of this
     act, the Department of Public Welfare shall provide a report to
     the Public Health and Welfare Committee of the Senate and the
     Health and Human Services Committee of the House of
     Representatives on pharmaceutical programs available within this
     Commonwealth that benefit residents with significant
     pharmaceutical costs, including those receiving medical
     assistance. The report shall include recommendations as to how
     the department and the Commonwealth may maximize the
     effectiveness of such programs and how the department and the
     Commonwealth may enhance the ability of Pennsylvanians to
     participate in such programs. The report may include
     recommendations on the following:
            (1)  Outreach to Pennsylvanians who may take advantage of
        such programs.
            (2)  Eligibility requirements.
            (3)  Copayments.
            (4)  Notifications to affected groups and agencies.
        Section 3.  This act shall take effect immediately.

     APPROVED--The 4th day of July, A. D. 2004.

     EDWARD G. RENDELL