S T A T E   O F   N E W   Y O R K
 ________________________________________________________________________
 
                                   7801
 
                        2025-2026 Regular Sessions
 
                           I N  A S S E M B L Y
 
                              April 11, 2025
                                ___________
 
 Introduced  by M. of A. WALKER, STIRPE, FORREST, DAVILA, BURDICK -- read
   once and referred 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
 may decline to participate in the  reimbursement  structure  created  by
 this legislation.

  EXPLANATION--Matter in ITALICS (underscored) is new; matter in brackets
                       [ ] is old law to be omitted.
                                                            LBD05789-02-5
 A. 7801                             2
              

 
   §  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
 THAN  EVERY THREE YEARS, PROVIDED THAT THE AVERAGE COMMERCIAL RATE SHALL
 A. 7801                             3
 
 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 April 1, 2025. 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.