Senate Bill S3592

                             
                     S T A T E   O F   N E W   Y O R K
 ________________________________________________________________________
 
                                   3592
 
                        2025-2026 Regular Sessions
 
                             I N  S E N A T E
 
                             January 28, 2025
                                ___________
 
 Introduced  by Sens. RIVERA, MYRIE, BAILEY, CLEARE, FERNANDEZ, GONZALEZ,
   GOUNARDES,  HOYLMAN-SIGAL,  KRUEGER,  LIU,  RAMOS,  SALAZAR,  SANDERS,
   SEPULVEDA, SERRANO -- read twice and ordered printed, and when printed
   to be committed to the Committee on Health
 
 AN ACT to amend the public health law, in relation to setting reimburse-
   ment rates for essential safety net hospitals
 
   THE  PEOPLE OF THE STATE OF NEW YORK, REPRESENTED IN SENATE AND ASSEM-
 BLY, DO ENACT AS FOLLOWS:
 
   Section 1. Legislative intent. Essential safety net hospitals predomi-
 nately serve historically marginalized neighborhoods and communities  of
 color,  with  Medicaid  and  uninsured patients comprising 36 percent or
 more of their patient population. Years of disinvestment and the current
 financing system impedes the ability  of  these  facilities  to  provide
 equitable  care  in  the  communities they serve. The perpetual cycle of
 underfunding of these hospitals prevents critical investment in services
 and requires annual supplemental state support to simply remain open  to
 provide care. The legislature seeks to implement a permanent solution to
 address decades-long inequities faced by communities served by essential
 safety  net  hospitals.  It  is the intent of the legislature to provide
 enhanced rates to essential safety net hospitals to support  investments
 to  stabilize the safety net workforce, allow for investment in critical
 hospital infrastructure, and provide expanded and equitable programs and
 services to  underserved  communities.  This  legislation  will  promote
 access  to  care  by ensuring that essential safety net hospitals in New
 York's most marginalized communities remain open and  are  better  posi-
 tioned  to successfully meet community needs. It is recognized that this
 legislation may require eligible hospitals to waive the receipt of Medi-
 caid Disproportionate  Share  Hospital  allotments  as  a  condition  of
 receiving  enhanced reimbursement rates as a result of this legislation.
 It is further recognized that an eligible essential safety net  hospital
 
  EXPLANATION--Matter in ITALICS (underscored) is new; matter in brackets
                       [ ] is old law to be omitted.
                                                            LBD05789-03-5
 S. 3592                             2
              

 
 may  decline  to  participate  in the reimbursement structure created by
 this legislation.
   §  2.  Section  2807-c of the public health law is amended by adding a
 new subdivision 34-a to read as follows:
   34-A. HEALTH EQUITY STABILIZATION AND TRANSFORMATION ACT.  (A) FOR THE
 PURPOSES OF THIS SUBDIVISION,  "ESSENTIAL  SAFETY  NET  HOSPITAL"  SHALL
 MEAN:
   (I)  ANY  HOSPITAL  ELIGIBLE FOR PARTICIPATION IN THE DIRECTED PAYMENT
 TEMPLATE (DPT) PREPRINT SUBMITTED BY THE STATE TO THE CENTERS FOR  MEDI-
 CAID AND MEDICARE SERVICES FOR FISCAL YEAR TWO THOUSAND TWENTY-FIVE;
   (II)  ANY NON-STATE PUBLIC HOSPITAL OPERATED BY A COUNTY, MUNICIPALITY
 OR PUBLIC BENEFIT CORPORATION; OR
   (III) ANY VOLUNTARY HOSPITAL CERTIFIED UNDER THIS ARTICLE  THAT  IS  A
 GENERAL  HOSPITAL,  WHICH,  IN ANY OF THE PREVIOUS THREE CALENDAR YEARS,
 HAS MET THE FOLLOWING CRITERIA:
   (A) AT LEAST THIRTY-SIX PERCENT OF INPATIENT  VOLUMES  ARE  ASSOCIATED
 WITH MEDICAID AND UNINSURED INDIVIDUALS;
   (B)  AT  LEAST THIRTY-SIX PERCENT OF OUTPATIENT VOLUMES ARE ASSOCIATED
 WITH MEDICAID AND UNINSURED INDIVIDUALS;
   (C) NO MORE THAN TWENTY PERCENT OF INPATIENT  VOLUMES  ARE  ASSOCIATED
 WITH COMMERCIALLY INSURED INDIVIDUALS; AND
   (D)  THE  HOSPITAL  IS  NOT  PART  OF A PRIVATE HEALTH SYSTEM WITH TEN
 BILLION DOLLARS OR MORE IN ANNUAL TOTAL PATIENT REVENUE.
   (B) FOR PURPOSES OF THIS SUBDIVISION, "ESSENTIAL SAFETY NET  HOSPITAL"
 SHALL  NOT  INCLUDE  HOSPITALS THAT ARE (I) PUBLIC HOSPITALS OPERATED BY
 THE STATE; (II) FEDERALLY DESIGNATED  AS  A  CRITICAL  ACCESS  HOSPITAL;
 (III)  FEDERALLY DESIGNATED AS A SOLE COMMUNITY HOSPITAL; (IV) SPECIALTY
 HOSPITALS; OR (V) CHILDREN'S HOSPITALS.
   (C) FOR PURPOSES OF THIS SUBDIVISION,  "HEALTH  CARE  SERVICES"  SHALL
 INCLUDE,  BUT  IS  NOT LIMITED TO, ACUTE INPATIENT DISCHARGES, INPATIENT
 PSYCHIATRIC DAYS, AMBULATORY SURGERY VISITS, EMERGENCY ROOM VISITS,  AND
 OUTPATIENT CLINIC SERVICES.
   (D)  FOR ESSENTIAL SAFETY NET HOSPITALS THAT QUALIFY PURSUANT TO PARA-
 GRAPH (A) OF THIS SUBDIVISION, THE COMMISSIONER SHALL, SUBJECT TO FEDER-
 AL APPROVAL, REQUIRE INPATIENT HOSPITALS RATES AND  HOSPITAL  OUTPATIENT
 RATES  PAID  BY  THE MEDICAL ASSISTANCE PROGRAM FOR SERVICES PROVIDED TO
 PATIENTS ENROLLED IN MEDICAID MANAGED CARE TO REIMBURSE THE ENTIRE CLASS
 OF ESSENTIAL SAFETY NET HOSPITALS IN EACH GEOGRAPHIC REGION AT  NO  LESS
 THAN REGIONAL AVERAGE COMMERCIAL RATES FOR HEALTH CARE SERVICES PROVIDED
 BY  ALL HOSPITALS IN THE SAME GEOGRAPHIC REGION, AS REPORTED IN A BENCH-
 MARKING DATABASE MAINTAINED BY A NONPROFIT ORGANIZATION SPECIFIED BY THE
 COMMISSIONER. SUCH NONPROFIT ORGANIZATION SHALL NOT BE  AFFILIATED  WITH
 AN  INSURER,  A CORPORATION SUBJECT TO ARTICLE FORTY-THREE OF THE INSUR-
 ANCE LAW, A MUNICIPAL COOPERATIVE HEALTH BENEFIT PLAN CERTIFIED PURSUANT
 TO ARTICLE FORTY-SEVEN OF THE INSURANCE LAW, A HEALTH MAINTENANCE ORGAN-
 IZATION CERTIFIED PURSUANT TO ARTICLE FORTY-FOUR OF THIS CHAPTER,  OR  A
 PROVIDER LICENSED UNDER THIS CHAPTER.  FOR PURPOSES OF THIS PARAGRAPH:
   (I) THE COMMISSIONER SHALL ESTABLISH TWO GEOGRAPHIC REGIONS WITHIN THE
 STATE  FOR  ESTABLISHING THE REGIONAL AVERAGE COMMERCIAL RATE. THE FIRST
 REGION SHALL  CONSIST  OF  THE  AVERAGE  COMMERCIAL  RATE  FOR  SERVICES
 PROVIDED  IN THE FOLLOWING COUNTIES: BRONX, KINGS, NEW YORK, QUEENS, AND
 RICHMOND.  THE SECOND REGION SHALL CONSIST  OF  THE  AVERAGE  COMMERCIAL
 RATE FOR SERVICES PROVIDED IN ALL OF THE REMAINING COUNTIES.
   (II)  THE  REGIONAL  AVERAGE  COMMERCIAL RATE FOR HEALTH CARE SERVICES
 SHALL REFLECT THE MOST RECENT  TWELVE-MONTH  PERIOD  IN  WHICH  DATA  ON
 COMMERCIAL  RATES  IS AVAILABLE, AND SHALL BE UPDATED NO LESS FREQUENTLY
 S. 3592                             3
 
 THAN EVERY THREE YEARS, PROVIDED THAT THE AVERAGE COMMERCIAL RATE  SHALL
 BE  TRENDED  FORWARD  TO ADJUST FOR INFLATION ON AN ANNUAL BASIS BETWEEN
 SUCH UPDATES.
   (III)  THE  COMMISSIONER  SHALL  ENSURE  THAT ALL ESSENTIAL SAFETY NET
 HOSPITALS SHALL RECEIVE THE RATES DEFINED IN THIS PARAGRAPH. THE COMMIS-
 SIONER SHALL NOT EXCLUDE ANY QUALIFYING ESSENTIAL SAFETY NET  HOSPITALS,
 INCLUDING PUBLIC HOSPITALS.
   (E)  IN  THE EVENT IT IS DETERMINED BY THE COMMISSIONER THAT THE STATE
 WILL BE UNABLE  TO  SECURE  ALL  NECESSARY  FEDERAL  APPROVALS  FOR  THE
 PURPOSES  OF  IMPLEMENTATION OF THIS SUBDIVISION, THE COMMISSIONER SHALL
 SEEK APPROVAL FOR REIMBURSEMENT RATES THAT ARE AS CLOSE TO  THE  AVERAGE
 COMMERCIAL  RATE  AS  POSSIBLE  IN ORDER TO OBTAIN ALL NECESSARY FEDERAL
 APPROVALS.
   (F) MANAGED CARE ORGANIZATIONS SHALL PROVIDE WRITTEN CERTIFICATION  TO
 THE  COMMISSIONER  ON  A  QUARTERLY BASIS THAT ALL PAYMENTS TO ESSENTIAL
 SAFETY NET HOSPITALS ARE MADE IN COMPLIANCE WITH THIS SUBDIVISION AND IN
 ACCORDANCE WITH SECTION THREE THOUSAND TWO HUNDRED TWENTY-FOUR-A OF  THE
 INSURANCE  LAW.  MANAGED  CARE  ORGANIZATIONS  SHALL  ALSO REPORT TO THE
 COMMISSIONER CLAIM DENIAL INFORMATION FOR CLAIMS SUBMITTED BY  ESSENTIAL
 SAFETY  NET  HOSPITALS, IN A MANNER SPECIFIED BY THE COMMISSIONER, TO BE
 MADE PUBLICLY AVAILABLE.
   (G) ANY HOSPITAL QUALIFYING  UNDER  THIS  SUBDIVISION  SHALL  ANNUALLY
 REPORT  TO THE DEPARTMENT DEMONSTRATING THAT IT MEETS THE CRITERIA AS AN
 ESSENTIAL SAFETY NET HOSPITAL. THE REPORT SHALL ALSO INCLUDE INFORMATION
 TO DEMONSTRATE HOW INCREASED REIMBURSEMENT HAS BEEN UTILIZED TO  IMPROVE
 PATIENT ACCESS, PATIENT QUALITY AND PATIENT EXPERIENCE.
   (H) THE COMMISSIONER SHALL MAKE ANY QUALITY DATA REPORTED BY ESSENTIAL
 SAFETY  NET  HOSPITALS  PURSUANT  TO  PARAGRAPH  (G) OF THIS SUBDIVISION
 PUBLICLY AVAILABLE IN A MANNER THAT IS USEFUL FOR PATIENTS TO MAKE QUAL-
 ITY DETERMINATIONS.
   (I) NO LATER THAN  SEPTEMBER  FIRST,  TWO  THOUSAND  TWENTY-FIVE,  THE
 COMMISSIONER  SHALL PROVIDE THE GOVERNOR, THE TEMPORARY PRESIDENT OF THE
 SENATE AND THE SPEAKER OF THE ASSEMBLY WITH A REPORT ON THE  FEASIBILITY
 OF  OBTAINING A STATE PLAN AMENDMENT TO MODIFY THE MEDICAID FEE-FOR-SER-
 VICE RATES FOR HEALTH CARE SERVICES IN THE  MANNER  PRESCRIBED  IN  THIS
 SUBDIVISION.
   §  3. This act shall take effect on the first of April next succeeding
 the date on which it shall have become a law. Effective immediately  the
 commissioner  of  health  or  their  designees shall make such rules and
 regulations, and seek any federal approvals necessary for the  implemen-
 tation of this act on its effective date.