State of Illinois
90th General Assembly
Legislation

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[ Introduced ][ Engrossed ][ House Amendment 001 ]
[ Senate Amendment 001 ]

90_HB3431enr

      305 ILCS 5/5-1            from Ch. 23, par. 5-1
          Amends the Medicaid  Article  of  the  Public  Aid  Code.
      Makes  a  stylistic change in a Section concerning purpose of
      the Medicaid program.
                                                     LRB9010626DJcd
HB3431 Enrolled                                LRB9010626DJcd
 1        AN  ACT  concerning  managed  care  community   networks,
 2    amending named Acts.
 3        Be  it  enacted  by  the People of the State of Illinois,
 4    represented in the General Assembly:
 5        Section 5.  The Health Maintenance  Organization  Act  is
 6    amended by changing Section 2-1 as follows:
 7        (215 ILCS 125/2-1) (from Ch. 111 1/2, par. 1403)
 8        Sec.  2-1.   Certificate  of  authority  -  Exception for
 9    corporate  employee  programs  -  Applications   -   Material
10    modification of operation.
11        (a)  No  organization shall establish or operate a Health
12    Maintenance Organization in this State  without  obtaining  a
13    certificate  of  authority  under  this Act.  No person other
14    than an organization may  lawfully  establish  or  operate  a
15    Health  Maintenance  Organization  in  this  State.  This Act
16    shall not apply to  the  establishment  and  operation  of  a
17    Health  Maintenance  Organization  exclusively  providing  or
18    arranging   for  health  care  services  to  employees  of  a
19    corporate affiliate of such Health Maintenance  Organization.
20    This  exclusion  shall  be  available  only  to  those Health
21    Maintenance    Organizations    which    require     employee
22    contributions  which equal less than 50% of the total cost of
23    the health care plan, with the remainder of  the  cost  being
24    paid  by the corporate affiliate which is the employer of the
25    participants in the  plan. This Act shall not  apply  to  the
26    establishment   and   operation   of   a  Health  Maintenance
27    Organization exclusively providing or arranging  health  care
28    services  under  contract with the State to persons committed
29    to the custody of the  Illinois  Department  of  Corrections.
30    This Act does not apply to the establishment and operation of
31    (i)  a  managed care community network providing or arranging
HB3431 Enrolled            -2-                 LRB9010626DJcd
 1    health  care  services  under   contract   with   the   State
 2    exclusively  to  persons  who  are enrolled in the integrated
 3    health care program established under Section 5-16.3  of  the
 4    Illinois  Public  Aid  Code  or (ii) a managed care community
 5    network owned, operated, or governed by a county provider  as
 6    defined in Section 15-1 of that Code.
 7        This   Act  does  not  apply  to  the  establishment  and
 8    operation  of  managed  care  community  networks  that   are
 9    certified  as risk-bearing entities under Section 5-11 of the
10    Illinois Public Aid Code and that contract with the  Illinois
11    Department of Public Aid pursuant to that Section.
12        (b)  Any  organization  may apply to the Director for and
13    obtain a certificate of authority to establish and operate  a
14    Health  Maintenance Organization in compliance with this Act.
15    A foreign corporation may qualify under this Act, subject  to
16    its  registration  to  do business in this State as a foreign
17    corporation.
18        (c)  Each application  for  a  certificate  of  authority
19    shall  be  filed  in triplicate and verified by an officer or
20    authorized representative of the applicant,  shall  be  in  a
21    form prescribed by the Director, and shall set forth, without
22    limiting what may be required by the Director, the following:
23             (1)  A copy of the organizational document;
24             (2)  A copy of the bylaws, rules and regulations, or
25        similar  document  regulating the conduct of the internal
26        affairs of the applicant, which shall include a mechanism
27        to afford the enrollees an opportunity to participate  in
28        an advisory capacity in matters of policy and operations;
29             (3)  A  list  of  the names, addresses, and official
30        positions of the persons who are to  be  responsible  for
31        the  conduct  of the affairs of the applicant; including,
32        but  not  limited  to,  all  members  of  the  board   of
33        directors,  executive  committee, the principal officers,
34        and any person or entity owning or having  the  right  to
HB3431 Enrolled            -3-                 LRB9010626DJcd
 1        acquire   10%   or  more  of  the  voting  securities  or
 2        subordinated debt of the applicant;
 3             (4)  A statement generally describing the applicant,
 4        geographic area to be served, its  facilities,  personnel
 5        and the health care services to be offered;
 6             (5)  A  copy  of the form of any contract made or to
 7        be made between the applicant and any providers regarding
 8        the provision of health care services to enrollees;
 9             (6)  A copy of the form of any contract made  or  to
10        be  made  between  the applicant and any person listed in
11        paragraph (3) of this subsection;
12             (7)  A copy of the form of any contract made  or  to
13        be   made   between   the   applicant   and  any  person,
14        corporation,  partnership  or  other   entity   for   the
15        performance  on  the  applicant's behalf of any functions
16        including, but not limited to, marketing, administration,
17        enrollment, investment management and subcontracting  for
18        the provision of health services to enrollees;
19             (8)  A  copy of the form of any group contract which
20        is to be issued to employers, unions, trustees, or  other
21        organizations  and  a  copy  of  any  form of evidence of
22        coverage to be issued to any enrollee or  subscriber  and
23        any advertising material;
24             (9)  Descriptions  of the applicant's procedures for
25        resolving  enrollee   grievances   which   must   include
26        procedures  providing  for enrollees participation in the
27        resolution of grievances;
28             (10)  A  copy  of  the   applicant's   most   recent
29        financial  statements audited by an independent certified
30        public accountant.   If  the  financial  affairs  of  the
31        applicant's  parent company are audited by an independent
32        certified public accountant but those  of  the  applicant
33        are not, then a copy of the most recent audited financial
34        statement  of  the  applicant's parent, attached to which
HB3431 Enrolled            -4-                 LRB9010626DJcd
 1        shall be consolidating financial statements of the parent
 2        including separate unaudited financial statements of  the
 3        applicant, unless the Director determines that additional
 4        or  more recent financial information is required for the
 5        proper administration of this Act;
 6             (11)  A copy  of  the  applicant's  financial  plan,
 7        including   a   three-year   projection   of  anticipated
 8        operating results, a statement of the sources of  working
 9        capital,  and any other sources of funding and provisions
10        for contingencies;
11             (12)  A description of rate methodology;
12             (13)  A  description  of  the  proposed  method   of
13        marketing;
14             (14)  A  copy of every filing made with the Illinois
15        Secretary of  State  which  relates  to  the  applicant's
16        registered agent or registered office;
17             (15)  A  description  of the complaint procedures to
18        be established and maintained as required  under  Section
19        4-6 of this Act;
20             (16)  A  description, in accordance with regulations
21        promulgated by the Illinois Department of Public  Health,
22        of   the   quality   assessment  and  utilization  review
23        procedures to be utilized by the applicant;
24             (17)  The fee for filing an application for issuance
25        of a certificate of authority provided in Section 408  of
26        the Illinois Insurance Code, as now or hereafter amended;
27        and
28             (18)  Such  other  information  as  the Director may
29        reasonably require to make the determinations required by
30        this Act.
31    (Source: P.A. 88-554, eff. 7-26-94.)
32        Section 10.  The Illinois Public Aid Code is  amended  by
33    changing Sections 5-11, 15-2, 15-3, and 15-5 as follows:
HB3431 Enrolled            -5-                 LRB9010626DJcd
 1        (305 ILCS 5/5-11) (from Ch. 23, par. 5-11)
 2        Sec.  5-11.  Co-operative  arrangements;  contracts  with
 3    other   State   agencies,   health  care  and  rehabilitation
 4    organizations, and fiscal intermediaries.
 5        (a)  The Illinois Department may enter into  co-operative
 6    arrangements    with    State    agencies   responsible   for
 7    administering or supervising  the  administration  of  health
 8    services  and  vocational  rehabilitation services to the end
 9    that there may be maximum utilization of such services in the
10    provision of medical assistance.
11        The Illinois Department shall, not later  than  June  30,
12    1993,  enter  into one or more co-operative arrangements with
13    the   Department   of   Mental   Health   and   Developmental
14    Disabilities providing that the Department of  Mental  Health
15    and   Developmental  Disabilities  will  be  responsible  for
16    administering or supervising all  programs  for  services  to
17    persons   in  community  care  facilities  for  persons  with
18    developmental disabilities,  including  but  not  limited  to
19    intermediate  care  facilities,  that  are supported by State
20    funds or by funding under Title XIX  of  the  federal  Social
21    Security  Act.   The  responsibilities  of  the Department of
22    Mental Health  and  Developmental  Disabilities  under  these
23    agreements   are  transferred  to  the  Department  of  Human
24    Services as provided in the Department of Human Services Act.
25        The Department may also contract with such  State  health
26    and  rehabilitation  agencies  and  other  public  or private
27    health care and rehabilitation organizations to act for it in
28    supplying designated medical  services  to  persons  eligible
29    therefor  under  this  Article.  Any  contracts  with  health
30    services   or   health  maintenance  organizations  shall  be
31    restricted to organizations  which  have  been  certified  as
32    being  in  compliance  with standards promulgated pursuant to
33    the laws  of  this  State  governing  the  establishment  and
34    operation   of   health   services   or   health  maintenance
HB3431 Enrolled            -6-                 LRB9010626DJcd
 1    organizations.  The  Department  may   also   contract   with
 2    insurance  companies  or  other corporate entities serving as
 3    fiscal  intermediaries  in  this  State   for   the   Federal
 4    Government  in respect to Medicare payments under Title XVIII
 5    of the Federal Social Security Act to act for the  Department
 6    in  paying medical care suppliers.  The provisions of Section
 7    9 of "An Act in relation to State finance", approved June 10,
 8    1919, as amended, notwithstanding, such contracts with  State
 9    agencies, other health care and rehabilitation organizations,
10    or fiscal intermediaries may provide for advance payments.
11        (b)  For  purposes  of this subsection (b), "managed care
12    community network" means  an  entity,  other  than  a  health
13    maintenance   organization,   that  is  owned,  operated,  or
14    governed by providers of health  care  services  within  this
15    State  and  that provides or arranges primary, secondary, and
16    tertiary managed health care services under contract with the
17    Illinois Department exclusively to persons  participating  in
18    programs administered by the Illinois Department.
19        The   Illinois   Department   may  certify  managed  care
20    community networks, including managed care community networks
21    owned, operated, managed, or governed by State-funded medical
22    schools, as risk-bearing entities eligible to  contract  with
23    the    Illinois   Department   as   Medicaid   managed   care
24    organizations.  The Illinois  Department  may  contract  with
25    those  managed care community networks to furnish health care
26    services  to  or  arrange  those  services  for   individuals
27    participating   in  programs  administered  by  the  Illinois
28    Department.    The   rates   for   those   provider-sponsored
29    organizations may  be  determined  on  a  prepaid,  capitated
30    basis.   A  managed  care  community  network  may  choose to
31    contract  with  the  Illinois  Department  to  provide   only
32    pediatric health care services. The Illinois Department shall
33    by  rule  adopt  the  criteria,  standards, and procedures by
34    which a managed care community network may  be  permitted  to
HB3431 Enrolled            -7-                 LRB9010626DJcd
 1    contract  with the Illinois Department and shall consult with
 2    the Department of Insurance in adopting these rules.
 3        A county provider as defined in Section 15-1 of this Code
 4    may contract with the Illinois Department to provide primary,
 5    secondary, or tertiary managed  health  care  services  as  a
 6    managed  care community network without the need to establish
 7    a  separate  entity  and  shall  be  deemed  a  managed  care
 8    community network for purposes  of  this  Code  only  to  the
 9    extent  it provides services to participating individuals.  A
10    county provider is entitled to  contract  with  the  Illinois
11    Department  with respect to any contracting region located in
12    whole or in part within the county.  A county provider is not
13    required to accept enrollees who do  not  reside  within  the
14    county.
15        In order to (i) accelerate and facilitate the development
16    of  integrated  health  care  in  contracting  areas  outside
17    counties with populations in excess of 3,000,000 and counties
18    adjacent  to those counties and (ii) maintain and sustain the
19    high quality of education and residency programs  coordinated
20    and  associated  with  local  area  hospitals,  the  Illinois
21    Department  may develop and implement a demonstration program
22    from  managed  care  community  networks   owned,   operated,
23    managed,  or  governed  by State-funded medical schools.  The
24    Illinois Department shall prescribe  by  rule  the  criteria,
25    standards,  and  procedures  for effecting this demonstration
26    program.
27        A managed care community network that contracts with  the
28    Illinois  Department  to  furnish  health care services to or
29    arrange  those  services  for  enrollees   participating   in
30    programs administered by the Illinois Department shall do all
31    of the following:
32             (1)  Provide  that  any provider affiliated with the
33        managed care community network may also provide  services
34        on a fee-for-service basis to Illinois Department clients
HB3431 Enrolled            -8-                 LRB9010626DJcd
 1        not enrolled in such managed care entities.
 2             (2)  Provide client education services as determined
 3        and  approved  by  the Illinois Department, including but
 4        not  limited  to  (i)  education  regarding   appropriate
 5        utilization  of  health  care  services in a managed care
 6        system, (ii) written disclosure of treatment policies and
 7        restrictions   or   limitations   on   health   services,
 8        including,  but  not  limited  to,   physical   services,
 9        clinical   laboratory   tests,   hospital   and  surgical
10        procedures,  prescription  drugs   and   biologics,   and
11        radiological  examinations, and (iii) written notice that
12        the enrollee may  receive  from  another  provider  those
13        covered  services  that  are  not provided by the managed
14        care community network.
15             (3)  Provide that enrollees within  the  system  may
16        choose  the  site for provision of services and the panel
17        of health care providers.
18             (4)  Not discriminate in enrollment or disenrollment
19        practices  among  recipients  of  medical   services   or
20        enrollees based on health status.
21             (5)  Provide  a  quality  assurance  and utilization
22        review program that meets the requirements established by
23        the Illinois Department in rules that  incorporate  those
24        standards   set   forth   in   the   Health   Maintenance
25        Organization Act.
26             (6)  Issue   a   managed   care   community  network
27        identification card to  each  enrollee  upon  enrollment.
28        The card must contain all of the following:
29                  (A)  The enrollee's health plan.
30                  (B)  The  name  and  telephone  number  of  the
31             enrollee's  primary  care  physician or the site for
32             receiving primary care services.
33                  (C)  A telephone number to be used  to  confirm
34             eligibility   for  benefits  and  authorization  for
HB3431 Enrolled            -9-                 LRB9010626DJcd
 1             services that is available 24 hours per day, 7  days
 2             per week.
 3             (7)  Ensure  that  every  primary care physician and
 4        pharmacy in the managed care community network meets  the
 5        standards  established  by  the  Illinois  Department for
 6        accessibility  and  quality  of  care.     The   Illinois
 7        Department shall arrange for and oversee an evaluation of
 8        the  standards  established  under this paragraph (7) and
 9        may recommend any necessary changes to these standards.
10             (8)  Provide a  procedure  for  handling  complaints
11        that  meets  the requirements established by the Illinois
12        Department in rules that incorporate those standards  set
13        forth in the Health Maintenance Organization Act.
14             (9)  Maintain,  retain,  and  make  available to the
15        Illinois Department records, data, and information, in  a
16        uniform  manner  determined  by  the Illinois Department,
17        sufficient  for  the  Illinois  Department   to   monitor
18        utilization, accessibility, and quality of care.
19             (10)  Provide  that  the  pharmacy formulary used by
20        the managed  care  community  network  and  its  contract
21        providers  be  no  more  restrictive  than  the  Illinois
22        Department's pharmaceutical program on the effective date
23        of  this amendatory Act of 1998 and as amended after that
24        date.
25        The Illinois Department shall contract with an entity  or
26    entities  to  provide  external  peer-based quality assurance
27    review for the managed health care programs  administered  by
28    the  Illinois Department.  The entity shall be representative
29    of Illinois physicians licensed to practice medicine  in  all
30    its  branches and have statewide geographic representation in
31    all specialities of medical care that are provided in managed
32    health care programs administered by the Illinois Department.
33    The entity may not be a third party payer and shall  maintain
34    offices  in  locations  around  the State in order to provide
HB3431 Enrolled            -10-                LRB9010626DJcd
 1    service  and  continuing  medical  education   to   physician
 2    participants   within  those  managed  health  care  programs
 3    administered by the Illinois Department.  The review  process
 4    shall  be  developed  and  conducted  by  Illinois physicians
 5    licensed to  practice  medicine  in  all  its  branches.   In
 6    consultation  with  the  entity,  the Illinois Department may
 7    contract with  other  entities  for  professional  peer-based
 8    quality assurance review of individual categories of services
 9    other  than  services provided, supervised, or coordinated by
10    physicians licensed to practice medicine in all its branches.
11    The Illinois Department shall establish, by rule, criteria to
12    avoid  conflicts  of  interest  in  the  conduct  of  quality
13    assurance activities consistent with professional peer-review
14    standards.   All  quality  assurance  activities   shall   be
15    coordinated by the Illinois Department.
16        Each  managed care community network must demonstrate its
17    ability to bear the financial  risk  of  serving  individuals
18    under  this  program.  The  Illinois Department shall by rule
19    adopt standards for  assessing  the  solvency  and  financial
20    soundness   of  each  managed  care  community  network.  Any
21    solvency and financial standards  adopted  for  managed  care
22    community  networks  shall  be  no  more restrictive than the
23    solvency  and  financial  standards  adopted  under   Section
24    1856(a)  of  the  Social  Security Act for provider-sponsored
25    organizations under Part C  of  Title  XVIII  of  the  Social
26    Security Act.
27        The  Illinois  Department  may  implement  the amendatory
28    changes to this Code made by  this  amendatory  Act  of  1998
29    through the use of emergency rules in accordance with Section
30    5-45  of  the  Illinois  Administrative  Procedure  Act.  For
31    purposes of that Act, the  adoption  of  rules  to  implement
32    these  changes  is  deemed an emergency and necessary for the
33    public interest, safety, and welfare.
34        (c)  Not  later  than  June  30,   1996,   the   Illinois
HB3431 Enrolled            -11-                LRB9010626DJcd
 1    Department   shall   enter   into  one  or  more  cooperative
 2    arrangements with the Department of  Public  Health  for  the
 3    purpose of developing a single survey for nursing facilities,
 4    including  but  not  limited to facilities funded under Title
 5    XVIII or Title XIX of the  federal  Social  Security  Act  or
 6    both, which shall be administered and conducted solely by the
 7    Department  of  Public Health. The Departments shall test the
 8    single survey  process  on  a  pilot  basis,  with  both  the
 9    Departments  of  Public  Aid and Public Health represented on
10    the consolidated survey team.  The pilot will sunset June 30,
11    1997.  After June 30, 1997, unless  otherwise  determined  by
12    the  Governor,  a  single  survey shall be implemented by the
13    Department of Public Health which would  not  preclude  staff
14    from  the  Department  of  Public  Aid  from going on-site to
15    nursing facilities to perform necessary  audits  and  reviews
16    which  shall  not  replicate  the  single State agency survey
17    required by this  Act.   This  Section  shall  not  apply  to
18    community  or  intermediate  care facilities for persons with
19    developmental disabilities.
20    (Source: P.A. 89-415, eff. 1-1-96; 89-507, eff. 7-1-97.)
21        (305 ILCS 5/15-2) (from Ch. 23, par. 15-2)
22        Sec. 15-2. County Provider Trust Fund.
23        (a)  There is created in the State  Treasury  the  County
24    Provider  Trust  Fund.   Interest earned by the Fund shall be
25    credited to the Fund.  The Fund shall not be used to  replace
26    any funds appropriated to the Medicaid program by the General
27    Assembly.
28        (b)  The  Fund  is  created  solely  for  the purposes of
29    receiving, investing, and distributing monies  in  accordance
30    with this Article XV.  The Fund shall consist of:
31             (1)  All   monies   collected  or  received  by  the
32        Illinois Department under Section 15-3 of this Code;
33             (2)  All  federal  financial  participation   monies
HB3431 Enrolled            -12-                LRB9010626DJcd
 1        received by the Illinois Department pursuant to Title XIX
 2        of   the   Social   Security   Act,  42  U.S.C.  1396(b),
 3        attributable  to  eligible  expenditures  made   by   the
 4        Illinois  Department  pursuant  to  Section  15-5 of this
 5        Code;
 6             (3)  All other monies received by the Fund from  any
 7        source, including interest thereon.
 8        (c)  Disbursements  from  the  Fund  shall be by warrants
 9    drawn by the State Comptroller upon receipt of vouchers  duly
10    executed  and  certified by the Illinois Department and shall
11    be made only:
12             (1)  For   hospital   inpatient    care,    hospital
13        outpatient   care,  care  provided  by  other  outpatient
14        facilities operated by  a  county,  and  disproportionate
15        share  hospital  payments  made  under  Title  XIX of the
16        Social Security  Act  and  Article  V  of  this  Code  as
17        required by Section 15-5 of this Code;
18             (1.5)  For  services  provided  by  county providers
19        pursuant to Section 5-11 or 5-16.3 of this Code;
20             (2)  For   the   reimbursement   of   administrative
21        expenses incurred by county providers on  behalf  of  the
22        Illinois  Department as permitted by Section 15-4 of this
23        Code;
24             (3)  For the reimbursement of monies received by the
25        Fund through error or mistake;
26             (4)  For  the  payment  of  administrative  expenses
27        necessarily incurred by the Illinois  Department  or  its
28        agent  in  performing  the  activities  required  by this
29        Article XV; and
30             (5)  For  the  payment  of  any  amounts  that   are
31        reimbursable  to  the  federal  government,  attributable
32        solely  to  the  Fund,  and  required to be paid by State
33        warrant.
34    (Source: P.A. 87-13; 88-554, eff. 7-26-94.)
HB3431 Enrolled            -13-                LRB9010626DJcd
 1        (305 ILCS 5/15-3) (from Ch. 23, par. 15-3)
 2        Sec. 15-3.  Intergovernmental Transfers.
 3        (a)  Each  qualifying  county  shall   make   an   annual
 4    intergovernmental  transfer  to the Illinois Department in an
 5    amount equal to 71.7% of the  difference  between  the  total
 6    payments  made  by  the  Illinois  Department  to such county
 7    provider for hospital services under Title XIX of the  Social
 8    Security  Act  or  pursuant to Section 5-11 or 5-16.3 of this
 9    Code in each fiscal year ending June 30 (or fraction  thereof
10    during the fiscal year ending June 30, 1993) and $108,800,000
11    (or    fraction    thereof),    except    that   the   annual
12    intergovernmental  transfer  shall  not  exceed   the   total
13    payments  made  by  the  Illinois  Department  to such county
14    provider for hospital services under this Code or pursuant to
15    Section  5-16.3  of  this  Code,   less   50%   of   payments
16    reimbursable  under  Title  XIX of the Social Security Act in
17    each fiscal year ending June 30 (or fraction thereof).
18        (b)  The  payment  schedule  for  the   intergovernmental
19    transfer    made    hereunder   shall   be   established   by
20    intergovernmental agreement between the  Illinois  Department
21    and the applicable county, which agreement shall at a minimum
22    provide:
23             (1)  For  periodic  payments no less frequently than
24        monthly  to  the  county  provider  for   inpatient   and
25        outpatient   approved   or  adjudicated  claims  and  for
26        disproportionate share payments under Section  5-5.02  of
27        this  Code  (in the initial year, for services after July
28        1, 1991, or such other date as an approved State  Medical
29        Assistance Plan shall provide) and to the county provider
30        pursuant to Section 5-16.3 of this Code.
31             (2)  For  periodic  payments no less frequently than
32        monthly  to  the   county   provider   for   supplemental
33        disproportionate  share  payments  hereunder  based  on a
34        federally approved State Medical Assistance Plan.
HB3431 Enrolled            -14-                LRB9010626DJcd
 1             (3)  For  calculation   of   the   intergovernmental
 2        transfer  payment to be made by the county equal to 71.7%
 3        of the difference between  the  amount  of  the  periodic
 4        payment  and  the base amount; provided, however, that if
 5        the periodic payment for any period is less than the base
 6        amount  for  such  period,  the  base  amount   for   the
 7        succeeding   period   (and   any   successive  period  if
 8        necessary) shall be  increased  by  the  amount  of  such
 9        shortfall.
10             (4)  For  an  intergovernmental transfer methodology
11        which obligates the Illinois  Department  to  notify  the
12        county  and  county provider in writing of each impending
13        periodic  payment  and  the  intergovernmental   transfer
14        payment  attributable  thereto  and  which  obligates the
15        Comptroller to release the periodic payment to the county
16        provider  within  one  working  day  of  receipt  of  the
17        intergovernmental transfer payment from the county.
18    (Source: P.A.  87-13;  87-861;  88-85;  88-88;  88-554,  eff.
19    7-26-94.)
20        (305 ILCS 5/15-5) (from Ch. 23, par. 15-5)
21        Sec. 15-5. Disbursements from the Fund.
22        (a)  The  monies  in  the Fund shall be disbursed only as
23    provided in Section 15-2 of this Code and as follows:
24             (1)  To  pay   the   county   hospitals'   inpatient
25        reimbursement rate based on actual costs, trended forward
26        annually  by  an  inflation  index  and  supplemented  by
27        teaching,  capital,  and other direct and indirect costs,
28        according  to  a  State  plan  approved  by  the  federal
29        government.  Effective October  1,  1992,  the  inpatient
30        reimbursement  rate  (including  any  disproportionate or
31        supplemental   disproportionate   share   payments)   for
32        hospital services provided by county operated  facilities
33        within the County shall be no less than the reimbursement
HB3431 Enrolled            -15-                LRB9010626DJcd
 1        rates in effect on June 1, 1992, except that this minimum
 2        shall  be  adjusted  as  of  July 1, 1992 and each July 1
 3        thereafter by the annual percentage  change  in  the  per
 4        diem  cost  of inpatient hospital services as reported in
 5        the most recent annual Medicaid cost report.
 6             (2)  To pay county  hospitals  and  county  operated
 7        outpatient  facilities for outpatient services based on a
 8        federally  approved  methodology  to  cover  the  maximum
 9        allowable costs per patient visit.  Effective October  1,
10        1992,  the  outpatient  reimbursement rate for outpatient
11        services provided by county hospitals and county operated
12        outpatient  facilities  shall  be  no   less   than   the
13        reimbursement  rates  in  effect  on June 1, 1992, except
14        that this minimum shall be adjusted as of  July  1,  1992
15        and  each  July  1  thereafter  by  the annual percentage
16        change  in  the  per  diem  cost  of  inpatient  hospital
17        services as reported in the most recent  annual  Medicaid
18        cost report.
19             (3)  To  pay  the county hospitals' disproportionate
20        share payments as established by the Illinois  Department
21        under  Section 5-5.02 of this Code.  Effective October 1,
22        1992, the disproportionate share  payments  for  hospital
23        services  provided  by  county operated facilities within
24        the County shall be no less than the reimbursement  rates
25        in effect on June 1, 1992, except that this minimum shall
26        be adjusted as of July 1, 1992 and each July 1 thereafter
27        by  the  annual percentage change in the per diem cost of
28        inpatient hospital  services  as  reported  in  the  most
29        recent annual Medicaid cost report.
30             (3.5)  To pay county providers for services provided
31        pursuant to Section 5-11 or 5-16.3 of this Code.
32             (4)  To  reimburse the county providers for expenses
33        contractually assumed pursuant to Section  15-4  of  this
34        Code.
HB3431 Enrolled            -16-                LRB9010626DJcd
 1             (5)  To  pay  the  Illinois Department its necessary
 2        administrative expenses relative to the  Fund  and  other
 3        amounts agreed to, if any, by the county providers in the
 4        agreement provided for in subsection (c).
 5             (6)  To   pay  the  county  hospitals'  supplemental
 6        disproportionate share payments,  hereby  authorized,  as
 7        specified in the agreement provided for in subsection (c)
 8        and   according  to  a  federally  approved  State  plan.
 9        Effective   October    1,    1992,    the    supplemental
10        disproportionate  share  payments  for  hospital services
11        provided by county operated facilities within the  County
12        shall  be  no less than the reimbursement rates in effect
13        on June 1,  1992,  except  that  this  minimum  shall  be
14        adjusted as of July 1, 1992 and each July 1 thereafter by
15        the  annual  percentage  change  in  the per diem cost of
16        inpatient hospital  services  as  reported  in  the  most
17        recent annual Medicaid cost report.
18        (b)  The  Illinois  Department  shall  promptly  seek all
19    appropriate amendments to the Illinois State Plan  to  effect
20    the foregoing payment methodology.
21        (c)  The  Illinois Department shall implement the changes
22    made by Article 3 of this amendatory Act  of  1992  beginning
23    October   1,   1992.    All   terms  and  conditions  of  the
24    disbursement of monies from the Fund not set forth  expressly
25    in  this Article shall be set forth in the agreement executed
26    under the Intergovernmental Cooperation Act so long as  those
27    terms  and  conditions are not inconsistent with this Article
28    or applicable federal law.   The  Illinois  Department  shall
29    report   in  writing  to  the  Hospital  Service  Procurement
30    Advisory Board and the Health Care Cost  Containment  Council
31    by  October  15,  1992,  the terms and conditions of all such
32    initial agreements and, where no such initial  agreement  has
33    yet  been  executed  with  a  qualifying county, the Illinois
34    Department's reasons that each such initial agreement has not
HB3431 Enrolled            -17-                LRB9010626DJcd
 1    been executed.  Copies  and  reports  of  amended  agreements
 2    following  the  initial agreements shall likewise be filed by
 3    the Illinois Department with the Hospital Service Procurement
 4    Advisory Board and the Health Care Cost  Containment  Council
 5    within  30  days  following  their  execution.  The foregoing
 6    filing   obligations   of   the   Illinois   Department   are
 7    informational  only,  to  allow  the   Board   and   Council,
 8    respectively,  to  better  perform their public roles, except
 9    that the Board or Council may, at its discretion, advise  the
10    Illinois  Department  in  the  case  of  the  failure  of the
11    Illinois Department to reach agreement  with  any  qualifying
12    county by the required date.
13        (d)  The  payments  provided  for  herein are intended to
14    cover services rendered on and after July 1,  1991,  and  any
15    agreement  executed  between  a  qualifying  county  and  the
16    Illinois  Department pursuant to this Section may relate back
17    to  that  date,  provided  the  Illinois  Department  obtains
18    federal approval.  Any changes  in  payment  rates  resulting
19    from  the  provisions  of Article 3 of this amendatory Act of
20    1992 are intended to apply to services rendered on  or  after
21    October  1,  1992,  and  any  agreement  executed  between  a
22    qualifying  county  and  the  Illinois Department pursuant to
23    this Section may be effective as of that date.
24        (e)  If one or more hospitals  file  suit  in  any  court
25    challenging   any  part  of  this  Article  XV,  payments  to
26    hospitals from the Fund under this Article XV shall  be  made
27    only  to  the  extent that sufficient monies are available in
28    the Fund and only to the extent that any monies in  the  Fund
29    are  not  prohibited  from  disbursement and may be disbursed
30    under any order of the court.
31        (f)  All payments under this Section are contingent  upon
32    federal  approval  of  changes  to  the  State  plan, if that
33    approval is required.
34    (Source: P.A. 87-13; 87-861; 88-554, eff. 7-26-94.)
HB3431 Enrolled            -18-                LRB9010626DJcd
 1        Section 99.  Effective date.  This Act takes effect  upon
 2    becoming law.

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