89 Ill. Adm. Code 1400.140.80
Hospital Provider Fund
Section 140
TITLE 89: SOCIAL SERVICES
CHAPTER I: DEPARTMENT OF HEALTHCARE AND FAMILY SERVICES
SUBCHAPTER d: MEDICAL PROGRAMS
PART 140 MEDICAL PAYMENT
SECTION 140.80 HOSPITAL PROVIDER FUND
Section 140.80 Hospital
Provider Fund
a) Purpose
and Contents
1) The Hospital Provider Fund (Fund) was created in the State
Treasury on February 3, 2004 (see 305 ILCS 5/5A-8). Interest earned by the
Fund shall be credited to the Fund. The Fund shall not be used to replace any
funds appropriated to the Medicaid program by the General Assembly.
2) The Fund is created for the purpose of receiving and
disbursing monies in accordance with this Section and Article 5A of the Code.
3) The Fund shall consist of:
A) All monies collected or received by the Department under subsection
(b);
B) All federal matching funds received by the Department as a
result of expenditures made by the Department that are attributable to monies
deposited in the Fund;
C) Any interest or penalty levied in conjunction with the
administration of the Fund;
D) Monies transferred from another fund in the State treasury;
E) All other monies received for the Fund from any other source,
including interest earned on those monies.
b) Provider
Assessments
1) Subject
to Sections 5A-3, 5A-10 and 5A-15 of the Code, for State fiscal years 2009
through 2018, or as long as continued under Section 5A-16, an annual assessment
on inpatient services is imposed on each hospital provider in an amount equal
to $218.38 multiplied by the difference of the hospital's occupied bed days
less the hospital's Medicare bed days; provided, however, the amount of $218.38
shall be increased by a uniform percentage to generate an amount equal to 75%
of the State share of the payments authorized under Section 5A-12-5 of the
Code, with that increase only taking effect upon the date that a State share
for those payments is required under federal law. For the period of April
through June 2015, the amount of $218.38 used to calculate the assessment under
this subsection (b)(1) shall be increased by a uniform percentage to generate
$20,250,000 in the aggregate for that period from all hospitals subject to the
annual assessment under this Section. For State fiscal years 2009 and after, a
hospital's occupied bed days and Medicare bed days shall be determined using
the most recent data available from each hospital's 2005 Medicare cost report
as contained in the Healthcare Cost Report Information System file, for the
quarter ending on December 31, 2006, without regard to any subsequent
adjustments or changes to such data. If a hospital's 2005 Medicare cost report
is not contained in the Healthcare Cost Report Information System, then the
Department may obtain the hospital provider's occupied bed days and Medicare
bed days from any source available, including, but not limited to, records
maintained by the hospital provider, which may be inspected at all times during
business hours of the day by the Department or its duly authorized agents and
employees. Subject to Sections 5A-3, 5A-10, and 5A-16
of the Code, for
State fiscal years 2019 and 2020, an annual assessment on inpatient services is
imposed on each hospital provider in an amount equal to $197.19 multiplied by
the difference of the hospital's occupied bed days less the hospital's Medicare
bed days. For State fiscal years 2019 and 2020, a hospital's occupied bed days
and Medicare bed days shall be determined using the most recent data available
from each hospital's 2015 Medicare cost report as contained in the Healthcare
Cost Report Information System file, for the quarter ending on March 31, 2017,
without regard to any subsequent adjustments or changes to such data. If a
hospital's 2015 Medicare cost report is not contained in the Healthcare Cost
Report Information System, then the Illinois Department may obtain the hospital
provider's occupied bed days and Medicare bed days from any source available,
including, but not limited to, records maintained by the hospital provider,
which may be inspected at all times during business hours of the day by the
Illinois Department or its duly authorized agents and employees.
Notwithstanding any other provision in this Section, for a hospital provider
that did not have a 2015 Medicare cost report, but paid an assessment in State
fiscal year 2018 on the basis of hypothetical data, that assessment amount
shall be used for State fiscal years 2019 and 2020
.
Subject to Sections
5A-3 and 5A-10, and in accordance with federal approval and P.A. 101-0650, for the
period of July 1, 2020 through December 31, 2020 and calendar years 2021 through
2024, an annual assessment on inpatient services is imposed on each hospital
provider in an amount equal to $221.50 multiplied by the difference of the
hospital's occupied bed days less the hospital's Medicare bed days, provided,
however, for the period of July 1, 2020 through December 31, 2020, the
assessment shall be equal to 50% of the annual amount and the amount of $221.50
shall be retroactively adjusted by a uniform percentage to generate an amount
equal to 50% of the Assessment Adjustment as defined in subsection (l). For the
period of July 1, 2020 through December 31, 2020 and calendar years 2021 through
2024, a hospital's occupied bed days and Medicare bed days shall be determined
using the most recent data available from each hospital's 2015 Medicare cost
report as contained in the Healthcare Cost Report Information System file, for
the quarter ending on March 31, 2017, without regard to any subsequent
adjustments or changes to such data. If a hospital's 2015 Medicare cost report
is not contained in the Healthcare Cost Report Information System, then the
Illinois Department may obtain the hospital provider's occupied bed days and
Medicare bed days from any source available, including, but not limited to,
records maintained by the hospital provider, which may be inspected at all
times during business hours of the day by the Illinois Department or its duly
authorized agents and employees. Should the change in the assessment methodology
for fiscal years 2021 through December 31, 2022 not be approved on or before
June 30, 2020, the assessment and payments under this Article in effect for
fiscal year 2020 shall remain in place until the new assessment is approved. If
the assessment methodology for July 1, 2020 through December 31, 2022, is
approved on or after July 1, 2020, it shall be retroactive to July 1, 2020,
subject to federal approval and provided that the payments authorized under
Section 5A-12.7 have the same effective date as the new assessment methodology.
In giving retroactive effect to the assessment approved after June 30, 2020,
credit toward the new assessment shall be given for any payments of the
previous assessment for periods after June 30, 2020. Notwithstanding any other
provision of this Article, for a hospital provider that did not have a 2015
Medicare cost report, but paid an assessment in State Fiscal Year 2020 on the
basis of hypothetical data, the data that was the basis for the 2020 assessment
shall be used to calculate the assessment under this paragraph until December
31, 2023. Beginning July 1, 2022 and through December 31, 2024, a safety-net
hospital that had a change of ownership in calendar year 2021, and whose
inpatient utilization had decreased by 90% from the prior year and prior to the
change of ownership, may be eligible to pay a tax based on hypothetical data
based on a determination of financial distress by the Department. Subject to
federal approval, the Department may, by January 1, 2024, develop a
hypothetical tax for a specialty cancer hospital which had a structural change
of ownership during calendar year 2022 from a for-profit entity to a non-profit
entity, and which has experienced a decline of 60% or greater in inpatient days
of care as compared to the prior owners 2015 Medicare cost report. This change
of ownership may make the hospital eligible for a hypothetical tax under the
new hospital provision of the assessment defined in this Section. This new
hypothetical tax may be applicable from January 1, 2024 through December 31,
2026.
A) Subject
to Sections 5A-3 and 5A-10, beginning January 1, 2025, an annual assessment on
inpatient services is imposed on each hospital provider in an amount equal to
$362, or any reduction thereof in accordance with this subsection, multiplied
by the difference of the hospital's occupied bed days less the hospital's
Medicare bed days; however, the rate shall be $221.50 until the Department
receives federal approval and implements the reimbursement rates in subsection
(r) of Section 5A-12.7. The Department may bill for the difference between the
assessment rate of $362, or any reduction thereof in accordance with this
subsection, and $221.50 no earlier than 17 calendar days after implementing the
reimbursement rates in subsection (r) of Section 5A-12.7.
B) Upon
receiving federal approval for the reimbursement rates in subsection (r) of
Section 5A-12.7, the Department shall bill the hospital for the incremental
difference in total tax due resulting from the increase provided in this
subsection for the number of months from January 1, 2025 through the date of
federal approval. The amount shall be due and payable no later than December
31, 2025 and no earlier than 17 calendar days after implementing the reimbursement
rates in subsection (r) of Section 5A-12.7. The Department shall bill hospitals
in the same proportional rate as the Department has implemented the inpatient
reimbursement rates in subsection (r) of Section 5A-12.7.
C) Beginning
January 1, 2025, a hospital's occupied bed days and Medicare bed days shall be
determined using the most recent data available from each hospital's 2015
Medicare cost report as contained in the Healthcare Cost Report Information
System file, for the quarter ending on March 31, 2017, without regard to any
subsequent adjustments or changes to such data. If a hospital's 2015 Medicare
cost report is not contained in the Healthcare Cost Report Information System,
then the Department may obtain the hospital provider's occupied bed days and
Medicare bed days from any source available, including, but not limited to,
records maintained by the hospital provider, which may be inspected at all
times during business hours of the day by the Department or its duly authorized
agents and employees. If the reimbursement rates in subsection (r) of Section
5A-12.7 require reduction to comply with federal spending limits, then the tax
rate of $362 shall be reduced, in accordance with subsection (s) of Section
5A-12.7, by the same percentage reduction to payments required to comply with
federal spending limits.
2) In addition to any other assessments imposed under this
Section, effective July 1, 2016 and semiannually thereafter through June 2018, or
as provided in Section 5A-16, in addition to any federally required State share
as authorized under subsection (b)(1), the amount of $218.38 shall be increased
by a uniform percentage to generate an amount equal to 75% of the ACA
Assessment Adjustment, as defined in subsection (l)(1).
3) Subject to Sections 5A-3, 5A-10, and 5A-15 of the Code for the
portion of State fiscal year 2012 beginning June 10, 2012 through June 30,
2012, and for State fiscal years 2013 through 2018, an annual assessment on
outpatient services is imposed on each hospital provider in an amount equal to
.008766 multiplied by the hospital's outpatient gross revenue; provided,
however, the multiplier of .008766 shall be increased by a uniform percentage
to generate an amount equal to 25% of the State share of the payments
authorized under Section 5A-12-5, with that increase only taking effect upon
the date that a State share for those payments is required under federal law.
For the period of April through June 2015, the amount of .008766 used to
calculate the assessment under this subsection (b)(3) shall be increased by a
uniform percentage to generate $6,750,000 in the aggregate for that period from
all hospitals subject to the annual assessment under this Section. For the
portion of State fiscal year 2012 beginning June 10, 2012 through June 30, 2012
and for State fiscal years 2013 through 2018, a hospital's outpatient gross
revenue shall be determined using the most recent data available from each
hospital's 2009 Medicare cost report as contained in the Healthcare Cost Report
Information System file, for the quarter ending on June 30, 2011, without regard
to any subsequent adjustments or changes to that data. If a hospital's 2009
Medicare cost report is not contained in the Healthcare Cost Report Information
System, then the Department may obtain the hospital provider's outpatient gross
revenue from any source available, including, but not limited to, records
maintained by the hospital provider, which may be inspected at all times during
business hours of the day by the Department or its duly authorized agents and
employees. For the period beginning June 10, 2012 through June 30, 2012, the
annual assessment on outpatient services shall be prorated by multiplying the
assessment amount by a fraction, the numerator of which is 21 days and the
denominator of which is 365 days. Subject to Sections 5A-3, 5A-10, and 5A-16,
for State fiscal years 2019 and 2020, an annual assessment on outpatient
services is imposed on each hospital provider in an amount equal to .01358
multiplied by the hospital's outpatient gross revenue. For State fiscal years
2019 and 2020, a hospital's outpatient gross revenue shall be determined using
the most recent data available from each hospital's 2015 Medicare cost report
as contained in the Healthcare Cost Report Information System file, for the
quarter ending on March 31, 2017, without regard to any subsequent adjustments
or changes to such data. If a hospital's 2015 Medicare cost report is not
contained in the Healthcare Cost Report Information System, then the Department
may obtain the hospital provider's outpatient gross revenue from any source
available, including, but not limited to, records maintained by the hospital
provider, which may be inspected at all times during business hours of the day
by the Department or its duly authorized agents and employees. Notwithstanding
any other provision in this Section, for a hospital provider that did not have
a 2015 Medicare cost report, but paid an assessment in State fiscal year 2018
on the basis of hypothetical data, that assessment amount shall be used for
State fiscal years 2019 and 2020. Subject to Sections 5A-3 and 5A-10, for the
period of July 1, 2020 through December 31, 2020 and calendar years 2021 through
2024, an annual assessment on outpatient services is imposed on each hospital
provider in an amount equal to .01525 multiplied by the hospital's outpatient
gross revenue, provided however, for the period of July 1, 2020 through
December 31, 2020, the assessment shall be equal to 50% of the annual amount
and the amount of .01525 shall be retroactively adjusted by a uniform percentage
to generate an amount equal to 50% of the Assessment Adjustment, as defined in
subsection (1). For the period of July 1, 2020 through December 31, 2020 and
calendar years 2021 through 2024, a hospital's outpatient gross revenue shall
be determined using the most recent data available from each hospital's 2015
Medicare cost report as contained in the Healthcare Cost Report Information
System file, for the quarter ending on March 31, 2017, without regard to any
subsequent adjustments or changes to that data. If a hospital's 2015 Medicare
cost report is not contained in the Healthcare Cost Report Information System,
then the Illinois Department may obtain the hospital provider's outpatient
revenue data from any source available, including, but not limited to, records
maintained by the hospital provider. The data may be inspected at all times
during business hours of the day by the Illinois Department or its duly
authorized agents and employees. Should the change in the assessment
methodology above for fiscal years 2021 through calendar year 2022 not be
approved prior to July 1, 2020, the assessment and payments under this Article
in effect for fiscal year 2020 shall remain in place until the new assessment
is approved. If the change in the assessment methodology above for July 1, 2020
through December 31, 2022, is approved after June 30, 2020, it shall have a
retroactive effective date of July 1, 2020, subject to federal approval and
provided that the payments authorized under Section 12A-7 have the same effective
date as the new assessment methodology. In giving retroactive effect to the
assessment approved after June 30, 2020, credit toward the new assessment shall
be given for any payments of the previous assessment for periods after June 30,
2020. Notwithstanding any other provision of this Article, for a hospital
provider that did not have a 2015 Medicare cost report, but paid an assessment
in State Fiscal Year 2020 on the basis of hypothetical data, the data that was
the basis for the 2020 assessment shall be used to calculate the assessment
under this paragraph until December 31, 2023. Beginning July 1, 2022 and
through December 31, 2024, a safety-net hospital that had a change of ownership
in calendar year 2021, and whose inpatient utilization had decreased by 90%
from the prior year and prior to the change of ownership, may be eligible to
pay a tax based on hypothetical data based on a determination of financial
distress by the Department.
A) Subject
to Sections 5A-3 and 5A-10, beginning January 1, 2025, an annual assessment on
outpatient services is imposed on each hospital provider in an amount equal to
.03273, or any reduction thereof in accordance with this subsection, multiplied
by the hospital's outpatient gross revenue; however the rate shall remain
.01525, until the Department receives federal approval and implements the
reimbursement rates of payment in subsection (r) of Section 5A-12.7. The
Department may bill for the difference between the assessment multiplier of
.03273 and .01525 no earlier than 17 calendar days after the first payment
based on the reimbursement rates in subsection (r) of Section 5A-12.7.
B) Upon
receiving federal approval for the reimbursement rates in subsection (r) of
Section 5A-12.7, the Department shall bill the hospital for the incremental
difference in total tax due resulting from the increase provided in this
subsection for the number of months from January 1, 2025 through the date of
federal approval. The amount shall be due and payable no later than December
31, 2025 and no earlier than 17 calendar days after implementing the
reimbursement rates in subsection (r) of Section 5A-12.7. The Department shall
bill hospitals in the same proportional rate as the Department has implemented
the outpatient reimbursement rates in subsection (r) of Section 5A-12.7.
C) Beginning
January 1, 2025, a hospital's outpatient gross revenue shall be determined
using the most recent data available from each hospital's 2015 Medicare cost
report as contained in the Healthcare Cost Report Information System file, for
the quarter ending on March 31, 2017, without regard to any subsequent
adjustments or changes to such data. If a hospital's 2015 Medicare cost report
is not contained in the Healthcare Cost Report Information System, then the Department
may obtain the hospital provider's outpatient revenue data from any source
available, including, but not limited to, records maintained by the hospital
provider, which may be inspected at all times during business hours of the day
by the Department or its duly authorized agents and employees. If the
reimbursement rates in subsection (r) of Section 5A-12.7 require reduction to
comply with federal spending limits, then the tax rate of .03273 shall be
reduced, in accordance with subsection (s) of Section 5A-12.7, by the same
percentage reduction to payments required to comply with federal spending
limits.
c) Payment
of Assessment Due
1) The inpatient
assessment imposed by Section 5A-2 of the Code for State fiscal year 2009 through
State fiscal year 2018, or as provided in Section 5A-16, shall be due and
payable in monthly installments, each equaling one-twelfth of the assessment
for the year, on the 14
th
State business day of each month.
No installment payments of an inpatient
assessment shall be due and payable, however, until after the Comptroller has
issued the payments required under Section 5A-12.2 of the Code. Assessment
payments postmarked on the due date will be considered as paid on time.
2) Except as provided in Section 5A-4(a-5) of the Code, the
outpatient assessment imposed by subsection (b)(3) for the portion of State
fiscal year 2012 beginning June 10, 2012 through June 30, 2012 and for State
fiscal year 2013 through State fiscal year 2018, or as provided in Section
5A-16, shall be due and payable in monthly installments, each equaling
one-twelfth of the assessment for the year, on the 14
th
State
business day of each month.
A) No installment payment of an outpatient assessment imposed by
subsection (b)(3) shall be due and payable, however, until after:
i) the Department notifies the hospital provider, in writing,
that the payment methodologies to hospitals required under Section 5A-12.4 of
the Code have been approved by the Centers for Medicare and Medicaid Services
of the U.S. Department of Health and Human Services (CMMS), and the waiver
under 42 CFR 433.68 for the assessment imposed by subsection (b) of this
Section, if necessary, has been granted by CMMS; and
ii) the Comptroller has issued the payments required under
Section 5A-12.4 of the Code.
B) Assessment payments postmarked on the due date will be
considered as paid on time. Upon notification to the Department of approval of
the payment methodologies required under Section 5A-12.4 of the Code and the waiver
granted under 42 CFR 433.68, if necessary, all installments otherwise due under
subsection (b)(3) of this Section prior to the date of notification shall be
due and payable to the Department upon written direction from the Department
and issuance by the Comptroller of the payments required under Section 5A-12.4
of the Code.
3) The
assessment imposed under P.A. 101-0650 and Section 5A-2 of the Code for State
fiscal year 2019 and each subsequent State fiscal year shall be due and payable
in monthly installments, each equaling one-twelfth of the assessment for the
year, on the 17
th
State business day of each month. The Department
has discretion to establish a late date due to delays in payments being made to
hospitals, as required by Section 5A-12.7 of the Code.
A) No
installment payment of an assessment imposed by P.A. 101-0650 and Section 5A-2
of the Code shall be due and payable, however, until after:
i) The
Department notifies the hospital provider, in writing, that the payment
methodologies to hospitals required under Section 5A-12.6 or 5A-12.7 of the
Code have been approved by the Centers for Medicare and Medicaid Services of
the U.S. Department of Health and Human Services, and the waiver under 42 CFR
433.68 for the assessment imposed by P.A. 101-0650 and Section 5A-2 of the
Code, if necessary, has been granted by the Centers for Medicare and Medicaid
Services of the U.S. Department of Health and Human Services; and
ii) The
Comptroller and managed care organizations have issued the payments required
under Section 5A-12.6 or 5A-12.7 of the Code.
B) Upon
notification to the Department of approval of the payment methodologies
required under Section 5A-12.6 or 5A-12.7 of the Code and the waiver granted
under 42 CFR 433.68, if necessary, all installments otherwise due under
subsection (b)(3) prior to the date of notification shall be due and payable to
the Department upon written direction from the Department and issuance by the
Comptroller and managed care organizations of the payments required under
Section 5A-12.6 or 5A-12.7 of the Code.
4) Any
assessment amount that is due and payable to the Department more frequently
than once per calendar quarter shall be remitted to the Department by the
hospital provider by means of electronic funds transfer. The Department may
provide for remittance by other means if the amount due is less than $10,000 or
electronic funds transfer is unavailable for this purpose.
5) All payments received by the Department shall be credited
first to unpaid installment amounts (rather than to penalty or interest),
beginning with the most delinquent installments.
d) Notice
Requirements, Penalty, and Maintenance of Records
1) The Department shall send a notice of assessment to every
hospital provider subject to an assessment under subsection (b), except that no
notice shall be sent for the outpatient assessment imposed under subsection
(b)(3) until the Department receives written notice that the payment
methodologies to hospitals required under Section 5A-12.4 of the Code has been
approved and the waiver under 42 CFR 433.68, if necessary, has been granted by CMMS.
2) If a hospital provider conducts, operates, or maintains more
than one hospital licensed by the Illinois Department of Public Health, a
separate notice shall be sent for each hospital.
e) Procedure
for Partial Year Reporting/Operating Adjustments
1) Cessation of business during the fiscal year in which the
assessment is being paid. If a hospital provider ceases to conduct, operate,
or maintain a hospital for which the person is subject to assessment under
subsection (b), the assessment for the State fiscal year in which the cessation
occurs shall be adjusted by multiplying the assessment computed under
subsection (d) by a fraction, the numerator of which is the number of days in
the year during which the provider conducts, operates, or maintains the
hospital and the denominator of which is 365. Immediately upon ceasing to
conduct, operate or maintain a hospital, the person shall pay the assessment
for the year as adjusted (to the extent not previously paid).
2) Commencing
of business during the fiscal year in which the assessment is being paid. A
hospital provider who commences conducting, operating, or maintaining a
hospital for which the person is subject to assessment under subsection (b),
upon notice by the Department, shall pay the assessment under subsection (d) as
computed by the Department in installments on the due dates stated on the
notices and on the regular installment due dates for the State fiscal year
occurring after the due date of the initial assessment notice. For State fiscal
years 2009 through 2018, in the case of a hospital provider that did not
conduct, operate or maintain a hospital in 2005, the inpatient assessment for
that State fiscal year shall be computed on the basis of hypothetical occupied
bed days for the full calendar year as determined by the Department. For the
portion of State fiscal year 2012 beginning June 10, 2012 through June 30,
2012, and for State fiscal years 2013 through 2018, in the case of a hospital
provider that did not conduct, operate or maintain a hospital in 2009, the
outpatient assessment imposed under subsection (b)(3) shall be computed on the
basis of hypothetical gross outpatient revenue for the full calendar year as
determined by the Department. The assessment determination made by the
Department is final.
3) Partial Calendar Year Operation Adjustment. For a hospital
provider that did not conduct, operate, or maintain a hospital throughout the
entire calendar year reporting period, the assessment for the State fiscal year
shall be annualized for the portion of the reporting period the hospital was
operational (dividing the assessment due by the number of days the hospital was
in operation and then multiplying the amount by 365). Information reported by a
prior provider from the same hospital during the calendar year shall be used in
the annualization equation, if available.
4) Notwithstanding
any other provision in this Section, for State fiscal years 2019 through calendar
year 2022, in the case of a hospital provider that did not conduct, operate, or
maintain a hospital in the year that is the basis of the calculation of the
assessment under this Section, the assessment under subsection (b) for the
State fiscal year shall be computed on the basis of hypothetical occupied bed
days for the full calendar year as determined by the Illinois Department,
except that for a hospital provider that did not have a 2015 Medicare cost
report, but paid an assessment in State fiscal year 2018 on the basis of
hypothetical data, that assessment amount shall be used for State fiscal years
2019 and 2020.
5) Notwithstanding
any other provision in this Section, for State fiscal years 2019 through calendar
year 2022, in the case of a hospital provider that did not conduct, operate, or
maintain a hospital in the year that is the basis of the calculation of the
assessment under this Section, the assessment under subsection (b) for that
State fiscal year shall be computed on the basis of hypothetical gross
outpatient revenue for the full calendar year as determined by the Illinois
Department, except that for a hospital provider that did not have a 2015
Medicare cost report, but paid an assessment in State fiscal year 2018 on the
basis of hypothetical data, that assessment amount shall be used for State
fiscal years 2019 and 2020.
6) Change in Ownership and/or Operators. The full quarterly
installment must be paid on the designated due dates regardless of changes in
ownership or operators. Liability for the payment of the assessment amount
(including past due assessments and any interest or penalties that may have
accrued against the amount) rests on the hospital provider currently operating
or maintaining the hospital regardless if these amounts were incurred by the
current owner or were incurred by previous owners. Collection of delinquent
assessment fees from previous providers will be made against the current
provider. Failure of the current provider to pay any outstanding assessment
liabilities incurred by previous providers shall result in the application of
penalties described in subsection (f)(1).
f) Penalties
1) Any hospital that fails to pay the full amount of an
installment when due shall be charged, unless waived by the Department for
reasonable cause, a penalty equal to 5% of the amount of the installment not
paid on or before the due date, plus 5% of the portion remaining unpaid on the
last day of each monthly period thereafter, not to exceed 100% of the
installment amount not paid on or before the due date. Waiver due to reasonable
cause may include but is not limited to:
A) provider
has not been delinquent on payment of an assessment due, within the last three
calendar years from the time the delinquency occurs.
B) provider
can demonstrate to the Department's satisfaction that a payment was made prior
to the due date.
C) provider
is a new owner/operator and the late payment occurred in the quarter in which
the new owner/operator assumed control of the facility.
2) Within 30 days after the due date, the Department may begin
recovery actions against delinquent hospitals participating in the Medicaid
Program. Payments may be withheld from the hospital until the entire
assessment, including any interest and penalties, is satisfied or until a
reasonable repayment schedule has been approved by the Department. If a
reasonable agreement cannot be reached or if a hospital fails to comply with an
agreement, the Department reserves the right to recover any outstanding provider
assessment, interest and penalty by recouping the amount or a portion thereof
from the hospital's future payments from the Department. The provider may
appeal this recoupment in accordance with the Department's rules at 89 Ill.
Adm. Code 104. The Department has the right to continue recoupment during the
appeal process. Penalties pursuant to subsection (f)(1) will continue to accrue
during the recoupment process. Recoupment proceedings against the same
hospital two times in a fiscal year may be cause for termination from the
Medicaid Program. Failure by the Department to initiate recoupment activities
within 30 days shall not reduce the provider's liabilities nor shall it
preclude the Department from taking action at a later date.
3) If the hospital does not participate in the Medicaid Program,
or is no longer doing business with the Department, or the Department cannot
recover the full amount due through the claims processing system, within three
months after the fee due date, the Department may begin legal action to recover
the monies, including penalties and interest owed, plus court costs.
g) Delayed
Payment – Groups of Hospitals
The Department
may establish delayed payment of assessments and/or waive the payment of
interest and penalties for groups of hospitals such as disproportionate share
hospitals or all other hospitals when:
1) The State delays payments to hospitals due to problems related
to State cash flow; or
2) A cash flow bond pool's, or any other group financing plans',
requests from providers for loans are in excess of its scheduled proceeds such
that a significant number of hospitals will be unable to obtain a loan to pay
the assessment.
h) Delayed
Payment – Individual Hospitals
In addition to
the provisions of subsection (g), the Department may delay assessments for
individual hospitals that are unable to make timely payments under this Section
due to financial difficulties. No delayed payment arrangements shall extend
beyond the last business day of the calendar quarter following the quarter in
which the assessment was to have been received by the Department as described
in subsection (c). The request must be received by the Department prior to the
due date of the assessment.
1) Criteria. Delayed payment provisions may be instituted only
under extraordinary circumstances. Delayed payment provisions may be made only
to qualified hospitals who meet all of the following requirements:
A) The provider has experienced an emergency that necessitates
institution of delayed payment provisions. Emergency in this instance is
defined as a circumstance under which institution of the payment and penalty
provisions described in subsections (c)(1), (c)(2), (f)(1) and (f)(2) would
impose severe and irreparable harm to the clients served. Circumstances that
may create these emergencies include, but are not limited to, the following:
i) Department system errors (either automated system or
clerical) that have precluded payments, or that have caused erroneous payments
such that the provider's ability to provide further services to clients is
severely impaired;
ii) Cash flow problems encountered by a provider that are
unrelated to Department technical system problems and that result in extensive
financial problems to a facility, adversely impacting on its ability to serve
its clients.
B) The provider serves a significant number of clients under the
medical assistance program. "Significant" in this instance means:
i) A hospital that serves a significant number of clients under
the medical assistance program; significant in this instance means that the
hospital qualifies as a disproportionate share hospital (DSH) under 89 Ill.
Adm. Code 148.120(a)(1) through 148.120(a)(2); or qualifies as a Medicare DSH
hospital under the current federal guidelines.
ii) A government-owned facility that meets the cash flow
criterion under subsection (h)(1)(A)(ii).
iii) A hospital that has filed for Chapter 11 bankruptcy and that
meets the cash flow criterion under subsection (h)(1)(A)(ii).
C) The provider must ensure that a delay of payment request, as
defined under subsection (h)(3)(A), is received by the Department prior to the
payment due date, and the request must include a Cash Position Statement that
is based upon current assets, current liabilities and other data for a date
that is less than 60 days prior to the date of filing. Any liabilities payable
to owners or related parties must not be reported as current liabilities on the
Cash Position Statement. A deferral of assessment payments will be denied if
any of the following criteria are met:
i) The ratio of current assets divided by current liabilities is
greater than 2.0.
ii) Cash, short term investments and long term investments equal
or exceed the total of accrued wages payable and the assessment payment. Long
term investments that are unavailable for expenditure for current operations due
to donor restrictions or contractual requirements will not be used in this
calculation.
D) The provider must show evidence of denial of an application to
borrow assessment funds through a cash flow bond pool or financial institutions
such as a commercial bank. The denial must be 90 days old or less.
E) The provider must sign an agreement with the Department that
specifies the terms and conditions of the delayed payment provisions. The
agreement shall contain the following provisions:
i) Specific reasons for institution of the delayed payment
provisions;
ii) Specific dates on which payments must be received and the
amount of payment that must be received on each specific date described;
iii) The interest or a statement of interest waiver as described
in subsection (h)(5) that shall be due from the provider as a result of
institution of the delayed payment provisions;
iv) A certification stating that, should the entity be sold, the
new owners will be made aware of the liability and any agreement selling the
entity will include provisions that the new owners will assume responsibility
for repaying the debt to the Department according to the original agreement;
v) A certification stating that all information submitted to the
Department in support of the delayed payment request is true and accurate to
the best of the signator's knowledge; and
vi) Other terms and conditions that may be required by the
Department.
2) A hospital that does not meet the above criteria may request a
delayed payment schedule. The Department may approve the request,
notwithstanding the hospital not meeting the above criteria, upon a sufficient
showing of financial difficulties and good cause by the hospital. If the
request for a delayed payment schedule is approved, all other conditions of
this subsection (h) shall apply.
3) Approval Process
A) In order to receive consideration for delayed payment
provisions, providers must ensure their request is received by the Department
prior to the payment due date, in writing (telefax requests are acceptable) to
the Bureau of Hospital and Provider Services. The request must be received by
the date designated by the Department. Providers will be notified, in writing,
as to the due dates for submitting delay of payment requests. Requests must be
complete and contain all required information before they are considered to
have met the time requirements for filing a delayed payment request. All
telefax requests must be followed up with original written requests, postmarked
no later than the date of the telefax. The request must include:
i) An explanation of the circumstances creating the need for the
delayed payment provisions;
ii) Supportive documentation to substantiate the emergency nature
of the request including a cash position statement as defined in subsection
(h)(1)(C), a denial of application to borrow the assessment as defined in
subsection (h)(1)(D) and an explanation of the risk of irreparable harm to the
clients; and
iii) Specification of the specific arrangements requested by the
provider.
B) The hospital shall be notified by the Department, in writing
prior to the assessment due date, of the Department's decision with regard to
the request for institution of delayed payment provisions. An agreement shall
be issued to the provider for all approved requests. The agreement must be
signed by the administrator, owner, chief executive officer or other authorized
representative and be received by the Department prior to the first scheduled
payment date listed in that agreement.
4) Waiver of Penalties. The penalties described in subsections
(f)(1) and (f)(2) may be waived upon approval of the provider's request for
institution of delayed payment provisions. In the event a provider's request
for institution of delayed payment provisions is approved and the Department
has received the signed agreement in accordance with subsection (h)(3)(B), the
penalties shall be permanently waived for the subject quarter unless the
provider fails to meet all of the terms and conditions of the agreement. In the
event the provider fails to meet all of the terms and conditions of the
agreement, the agreement shall be considered null and void and the penalties
shall be fully reinstated.
5) Interest. The delayed payments shall include interest at a
rate not to exceed the State of Illinois borrowing rate. The applicable
interest rate shall be identified in the agreement described in subsection
(h)(1)(E). The interest may be waived by the Department if the facility's
current ratio, as described in subsection (h)(1)(C), is 1.5 or less and the
hospital meets the criteria in subsections (h)(1)(A) and (B). Any waivers
granted shall be expressly identified in the agreement described in subsection
(h)(1)(E).
6) Subsequent Delayed Payment Arrangements. Once a provider has
requested and received approval for delayed payment arrangements, the provider
shall not receive approval for subsequent delayed payment arrangements until
such time as the terms and conditions of any current delayed payment agreement
have been satisfied or unless the provider is in full compliance with the terms
of the current delayed payment agreement. The waiver of penalties described in
subsection (h)(4) shall not apply to a provider that has not satisfied the
terms and conditions of any current delayed payment agreement.
i) Administration
and Enforcement Provisions
The Department shall establish and
maintain a listing of all hospital providers appearing in the licensing records
of the Department of Public Health, which shall show each provider's name and
principal place of business and the name and address of each hospital operated,
conducted, or maintained by the provider in this State. The listing shall also
include the monthly assessment amounts owed for each hospital and any unpaid
assessment liability greater than 90 days delinquent. The Department shall
administer and enforce Sections 5A-1, 2, 3, 4, 5, 7, 8, 10, 12, 15, and 16 of
the Code and collect the assessments and penalty assessments imposed under P.A.
101-0650 and Sections 5A-2 and 4 of the Code. The Department, its Director,
and every hospital provider subject to assessment measured by occupied bed days
shall have the following powers, duties and rights:
1) The Department may initiate either administrative or judicial
proceedings, or both, to enforce the provisions of Sections 5A-1, 2, 3, 4, 5,
7, 8, 10, 12, 15 and 16 of the Code. Administrative enforcement proceedings
initiated shall be governed by the Department's rules at 89 Ill. Adm. Code
104.200 through 104.330. Judicial enforcement proceedings initiated shall be
governed by the rules of procedure applicable in the courts of this State.
2) Any unpaid assessment under P.A. 101-0650 and Section 5A-2 of
the Code shall become a lien upon the assets of the hospital upon which it was
assessed. If any hospital provider, outside the usual course of its business,
sells or transfers the major part of any one or more of the real property and
improvements, the machinery and equipment, or the furniture or fixtures of any
hospital that is subject to the provisions of Sections 5A-1, 2, 3, 4, 5, 7, 8,
10, 12, 15 and 16 of the Code, the seller or transferor shall pay the
Department the amount of any assessment, assessment penalty, and interest (if
any) due from it under P.A. 101-0650 and Sections 5A-2 and 4 of the Code up to
the date of the sale or transfer. The Illinois Department may, in its
discretion, foreclose on such a lien, but shall do so in a manner that is
consistent with Section 5e of the Retailers' Occupation Tax Act. Factors in
consideration of whether to foreclose on a lien may include, but are not
limited to, the amount of the unpaid lien, the likelihood of payment through
alternative methods, the existence of liens with priority, the economic
viability of the debtor, and the value of the property. If the seller or
transferor fails to pay any assessment, assessment penalty, and interest (if
any) due, the purchaser or transferee of the asset shall be liable for the
amount of the assessment, penalties and interest (if any) up to the amount of
the reasonable value of the property acquired by the purchaser or transferee.
The purchaser or transferee shall continue to be liable until the purchaser or
transferee pays the full amount of the assessment, penalties, and interest (if
any) up to the amount of the reasonable value of the property acquired by the
purchaser or transferee or until the purchaser or transferee receives from the
Department a certificate showing that the assessment, penalty and interest have
been paid or a certificate from the Department showing that no assessment,
penalty or interest is due from the seller or transferor under P.A. 101-0650
and Sections 5A-2, 4 and 5 of the Code.
3) Payments under Section 5A-4 of the Code are not subject to the
Illinois Prompt Payment Act [30 ILCS 540]. Credits or refunds shall not bear
interest.
4) In addition to any other remedy provided for and without
sending a notice of assessment liability, the Department shall collect an
unpaid assessment by withholding, as payment of the assessment, reimbursements
or other amounts otherwise payable by the Department to the hospital provider,
including, but not limited to, payment amounts otherwise payable from a managed
care organization performing duties under contract with the Illinois Department.
A) The
requirements of this subsection may be waived in instances when a disaster
proclamation has been declared by the Governor. In such circumstances, a
hospital must demonstrate temporary financial distress and establish an
agreement with the Illinois Department specifying when repayment in full of all
taxes owed will occur.
B) The
requirements of this subsection may be waived by the Illinois Department in
instances when a hospital has entered into and remains in compliance with are
payment plan or a tax deferral plan. A repayment plan or tax deferral plan must
be entered into no later than 30 days after notice of an unpaid assessment
payment. No repayment plan may exceed a period of 36 months. No tax deferral
plan may exceed a period of 6 months, and repayment after the end of a tax
deferral plan shall not exceed 36 months. Failure to remain in compliance with
are payment plan or tax deferral plan shall cause immediate termination of such
plan unless there is prior written consent from the Illinois Department for a
period of non-compliance.
C) Beginning
September 1, 2025, the Illinois Department shall immediately collect all
overdue unpaid assessments and penalties through the collection methods
authorized under this Section, unless a repayment plan or tax deferral plan has
already been agreed to by September 1, 2025.
j) Exemptions
The following classes of providers
are exempt from the assessment imposed under Section 5A-4 of the Code unless
the exemption is adjudged to be unconstitutional or otherwise invalid:
1) A
hospital provider that is a State agency, a State university, or a county with
a population of 3,000,000 or more.
2) A
hospital provider that is a county with a population of less than 3,000,000 or
a township, municipality, hospital district, or any other local governmental
unit.
k) Nothing in Section 5A-4 of the Code shall be construed to
prevent the Department from collecting all amounts due under this Section
pursuant to an assessment imposed before February 3, 2004.
l) Definitions
As used in this Section, unless the context requires otherwise:
1) "ACA
Assessment Adjustment" means:
A) For the period of July 1, 2016 through December 31, 2016, the
product of .19125 multiplied by the sum of the fee-for-service payments to
hospitals authorized under Section 5A-12.5 of the Code and the adjustments
authorized under Section 5A-12.2(t) of the Code to managed care organizations
for hospital services due and payable in the month of April 2016 multiplied by
6.
B) For the period of January 1, 2017 through June 30, 2017, the
product of .19125 multiplied by the sum of the fee-for-service payments to
hospitals authorized under Section 5A-12.5 of the Code and the adjustments
authorized under Section 5A-12.2(t) to managed care organizations for hospital
services due and payable in the month of October 2016 multiplied by 6, except
that the amount calculated under this subsection (l)(1)(B) shall be adjusted,
either positively or negatively, to account for the difference between the
actual payments issued under Code Section 5A-12.5 for the period beginning July
1, 2016 through December 31, 2016 and the estimated payments due and payable in
the month of April 2016 multiplied by 6 as described in subsection (l)(1)(A).
C) For the period of July 1, 2017 through December 31, 2017, the
product of .19125 multiplied by the sum of the fee-for-service payments to
hospitals authorized under Section 5A-12.5 of the Code and the adjustments
authorized under Section 5A-12.2(t) of the Code to managed care organizations
for hospital services due and payable in the month of April 2017 multiplied by
6, except that the amount calculated under this subsection (l)(1)(C) shall be
adjusted, either positively or negatively, to account for the difference
between the actual payments issued under Code Section 5A-12.5 for the period
beginning January 1, 2017 through June 30, 2017 and the estimated payments due
and payable in the month of October 2016 multiplied by 6 as described in
subsection (l)(1)(B).
D) For the period of January 1, 2018 through June 30, 2018, the
product of .19125 multiplied by the sum of the fee-for-service payments to
hospitals authorized under Section 5A-12.5 of the Code and the adjustments
authorized under Section 5A-12.2(t) of the Code to managed care organizations
for hospital services due and payable in the month of October 2017 multiplied
by 6, except that:
i) the amount calculated under this subsection (l)(1)(D) shall
be adjusted, either positively or negatively, to account for the difference
between the actual payments issued under Code Section 5A-12.5 for the period of
July 1, 2017 through December 31, 2017 and the estimated payments due and
payable in the month of April 2017 multiplied by 6 as described in subsection
(l)(1)(C); and
ii) the
amount calculated under this subsection (l)(1)(D) shall be adjusted to include
the product of .19125 multiplied by the sum of the fee-for-service payments, if
any, estimated to be paid to hospitals under Section 5A-12.5(b) of the Code.
2) "Assessment
Adjustment" means, for the period of July 1, 2020 through December 31,
2020, the product of .3853 multiplied by the total of the actual payments made
under Section 5A-12.7(c) through (k) of P.A. 101-0650 attributable to that
period, less the total of the assessment imposed under subsections (b)(1) and
(b)(3) of this Section for the period. For each calendar quarter beginning
January 1, 2021 through December 31, 2022 the product of .3853 multiplied by
the total of the actual payments made under Section 5A-12.7(c) through (k) of P.A.
101-0650 attributable to the period, less the total of the assessment imposed
under subsections (b)(1) and (b)(3) of this Section for that period. Beginning
on January 1, 2023, and each subsequent July 1 and January 1, the product of
.3853 multiplied by the total of the actual payments made under subsections (c)
through (j) and subsection (r) of Section 5A-12.7 attributable to the 6-month
period immediately preceding the period to which the adjustment applies, less
the total of the assessment imposed under subsections (a) and (b-5) of this
Section for the 6-month period immediately preceding the period to which the
adjustment applies.
3) "CMMS" means the Centers for Medicare and Medicaid
Services of the U.S. Department of Health and Human Services.
4) "Code" means the Illinois Public Aid Code [305 ILCS
5].
5) "Department" means the Illinois Department of
Healthcare and Family Services.
6) "Fund" means the Hospital Provider Fund.
7) "HCRIS" means the federal Centers for Medicare and
Medicaid Services Healthcare Cost Report Information System.
8) "Hospital" means an institution, place, building, or
agency located in this State that is subject to licensure by the Illinois
Department of Public Health under the Hospital Licensing Act, whether public or
private and whether organized for profit or not-for-profit.
9) "Hospital Provider" means a person licensed by the
Department of Public Health to conduct, operate, or maintain a hospital,
regardless of whether the person is a Medicaid provider. For purposes of this
definition, "person" means any political subdivision of the State,
municipal corporation, individual, firm, partnership, corporation, company,
limited liability company, association, joint stock association or trust, or a
receiver, executor, trustee, guardian, or other representative appointed by
order of any court.
10) "Inpatient
Gross Revenue" means total inpatient gross revenue, as reported on the
HCRIS Worksheet C, Part 1, Column 6, Line 101, less the sum of the following
lines (including any subset lines of these lines):
A) Line
34: Skilled Nursing Facility.
B) Line
35: Other Nursing Facility.
C) Line
35.01: Intermediate Care Facility for the Mentally Retarded.
D) Line
36: Other Long Term Care.
E) Line
45: PBC Clinical Laboratory Services – Program Only.
F) Line
60: Clinic.
G) Line
63: Other Outpatient Services.
H) Line
64: Home Program Dialysis.
I) Line
65: Ambulance Services.
J) Line
66: Durable Medical Equipment – Rented.
K) Line
67: Durable Medical Equipment – Sold.
L) Line
68: Other Reimbursable.
11) "Medicare
Bed Days" means, for each hospital, the sum of the number of days that
each bed was occupied by a patient who was covered by Title XVIII of the Social
Security Act, excluding days attributable to the routine services provided to
persons receiving skilled or intermediate long term care services. Medicare bed
days shall be computed separately for each hospital operated or maintained by a
hospital provider.
12) "Medicare
Gross Inpatient Revenue" means the sum of the following:
A) The
sum of the following lines from the HCRIS Worksheet D-4, Column 2 (excluding
the Medicare gross revenue attributable to the routine services provided to
patients in a psychiatric hospital, a rehabilitation hospital, a distinct part
psychiatric unit, a distinct part rehabilitation unit or swing beds):
i) Line
25: Adults and Pediatrics.
ii) Line
26: Intensive Care Unit.
iii) Line
27: Coronary Care Unit.
iv) Line
28: Burn Intensive Care Unit.
v) Line
29: Surgical Intensive Care Unit.
vi) Line
30: Other Special Care Unit.
B) From
Worksheet D-4, Column 2, the amount from Line 103 less the sum of Lines 60, 63,
64, 66, 67 and 68 (and any subset lines of these lines).
C) The
amount from Worksheet D-6, Part 3, Column 3, Line 53.
13) "Medicare
Gross Outpatient Revenue" means the amount from the HCRIS Worksheet D,
Part V, Line 101, Columns 5, 5.01, 5.02, 5.03 and 5.04 less the sum of Lines
45, 60, 63, 64, 65, 66 and 67 (and any subset lines of these lines).
14) "Occupied
Bed Days" means the sum of the number of days that each bed was occupied
by a patient for all beds, excluding beds classified as long term care beds and
assessed a licensed bed fee during calendar year 2001. Occupied bed days shall
be computed separately for each hospital operated or maintained by a hospital
provider.
15) "Outpatient
Gross Revenue" (prior to State fiscal year 2019 from Medicare 2552-96 cost
reports) means, for each hospital, its total gross charges attributed to
outpatient services as reported on the Medicare cost report at Worksheet C,
Part I, Column 7, Line 101 less the sum of lines 45, 60, 63, 64, 65, 66, 67 and
68 (and any subset lines of these lines).
16) "Outpatient
Gross Revenue" (for State fiscal year 2019 and thereafter from Medicare
2552-10 cost reports) means, for each hospital, its total gross charges
attributed to outpatient services as reported on the Medicare cost report at
Worksheet C, Part I, Column 7, Line 200 less the sum of lines 61, 90, 94, 95,
96, 97, 99, 100, 101, 115, 116, and 117 (and any subset lines of these lines).