N.Y. Public Health Law § 2807: Hospital reimbursement provisions; generally

§ 2807. Hospital reimbursement provisions; generally. 1. Valid

operating certificate requirement. No government agency and no

corporation organized and operating in accordance with article

forty-three of the insurance law and no health maintenance organization

organized and operating in accordance with article forty-four of this

chapter, shall purchase, pay for or make reimbursement or grants-in-aid

for any hospital or health-related service, unless, at the time the

service was provided, the hospital possessed a valid operating

certificate authorizing such service. No government agency shall

purchase, pay for or make reimbursement or grants-in-aid for any

hospital or health-related service that has been determined by the

commissioner of health to be unauthorized for payment under the medical

assistance program pursuant to section twenty-eight hundred three of

this article.

2. (a) Rate approvals. Payments for hospital service and

health-related service made by government agencies or for services

provided prior to January first, nineteen hundred ninety-seven by

organizations operating in accordance with the provisions of article

forty-four of this chapter shall be at rates approved by the state

director of the budget in the case of government agencies and approved

by the commissioner in the case of plans, organized and operating under

the provisions of article forty-four of this chapter, under which such

payments are made by agencies other than government agencies or

corporations organized and operating in accordance with article

forty-three of the insurance law. Payments for hospital service and

health-related service by corporations organized and operating in

accordance with article forty-three of the insurance law for services

provided prior to January first, nineteen hundred ninety-seven shall be

at rates approved by the commissioner of health.

(a-1) Notwithstanding any inconsistent provision of law, rates of

payment by governmental agencies for the operating cost component of

general hospital out-patient and emergency services, and for the

operating cost component of treatment or diagnostic center services

shall not require a certification by the commissioner that they are

reasonably related to the costs of efficient production of such services

nor that they are reasonable and adequate to meet the costs which must

be incurred by efficiently and economically operated facilities.

(b) During the period October first, nineteen hundred ninety-four

through September thirtieth, nineteen hundred ninety-five and for each

twelve month rate period commencing on October first thereafter, rates

of payment by governmental agencies for the operating cost component of

treatment or diagnostic center services shall be based on operating

costs in the base year cost report adjusted by a trend factor determined

in accordance with rules and regulations promulgated pursuant to

paragraph (b) of subdivision two of section twenty-eight hundred three

of this article; provided, however, that prior to such adjustment,

allowable operating costs shall be established by the commissioner after

taking into account the cost of services provided in facilities offering

similar services and regional economic factors, plus the addition of the

capital cost per visit. The capital cost per visit shall be based on the

base year cost report except that the capital cost per visit may be

adjusted for major outpatient capital expenditures, incurred subsequent

to the reporting year, when such expenditures have received the

requisite approvals and the facility has provided the commissioner with

a certified statement of expenditures. The base year for the rate period

commencing on October first, nineteen hundred ninety-four shall be

nineteen hundred ninety-two and shall be advanced one year thereafter

for each subsequent rate period.

(c) Notwithstanding any other provision of law to the contrary, for a

diagnostic and treatment center licensed pursuant to this article that

provides, as its principal mission, services to individuals with

developmental disabilities, the commissioner may fully or partially

waive or modify recoupment of medical assistance payments based on

retroactive changes to the applicable formula for capital costs for the

period of September first, two thousand nine to December thirty-first,

two thousand twelve.

* (e) Notwithstanding any inconsistent provisions of this subdivision

or any other law, payments made by governmental agencies for ambulatory

surgical services provided by a hospital, including general hospitals

and diagnostic and treatment centers, during the period June first,

nineteen hundred eighty-nine through December thirty-first, nineteen

hundred eighty-nine and the period January first, nineteen hundred

ninety through December thirty-first, nineteen hundred ninety and every

twelve month rate period thereafter shall be at case based rates of

reimbursement established by the commissioner and approved by the state

director of the budget. Ambulatory surgical services case based rates of

payment shall be established prospectively and shall include operating

costs and capital costs. Factors considered in establishing such case

based rates shall include, but not be limited to: a classification of

procedures with individual or combined rates established for each

services classification; operating and capital costs of ambulatory

surgical services efficiently and economically provided, considering

regional economic factors, trended to the rate period; and the need for

incentives to improve services and institute economies.

* NB Expired April 1, 2011

* (f) (i) During the period July first, nineteen hundred ninety

through March thirty-first, nineteen hundred ninety-one, the rate

periods during the period April first, nineteen hundred ninety-one

through September thirtieth, nineteen hundred ninety-four and for each

fiscal year period commencing on October first thereafter, comprehensive

clinic rates of payment by governmental agencies established in

accordance with paragraph (b) of this subdivision, applicable for

services provided to individuals eligible for medical assistance

pursuant to title eleven of article five of the social services law for

voluntary non-profit or publicly sponsored diagnostic and treatment

centers providing a comprehensive range of primary health care services

which can demonstrate, on forms provided by the commissioner, losses

from a disproportionate share of bad debt and charity care during a base

year period established by regulation may include an allowance

determined in accordance with this paragraph to reflect the needs of the

diagnostic and treatment center for the financing of losses resulting

from bad debt and the costs of charity care. Losses resulting from bad

debt and the costs of charity care shall be determined by the

commissioner considering, but not limited to, such factors as the losses

resulting from bad debt and the costs of charity care provided by the

diagnostic and treatment center and the availability of other financial

support, including state and local assistance public health aid, to meet

the losses resulting from bad debt and the costs of charity care of the

diagnostic and treatment center. The bad debt and charity care allowance

for a diagnostic and treatment center for a rate period shall be

determined by the commissioner in accordance with rules and regulations

adopted by the council and approved by the commissioner, and shall be

consistent with the purposes for which such allowances are authorized

for general hospitals pursuant to the provisions of article twenty-eight

of this chapter and rules and regulations promulgated by the

commissioner. A diagnostic and treatment center applying for a bad debt

and charity care allowance pursuant to this paragraph shall provide

assurances satisfactory to the commissioner that it shall undertake

reasonable efforts to maintain financial support from community and

public funding sources and reasonable efforts to collect payments for

services from third party insurance payors, governmental payors and

self-paying patients. To be eligible for an allowance pursuant to this

paragraph, a diagnostic and treatment center must provide a

comprehensive range of primary health care services and must demonstrate

that a minimum of fifteen percent of total clinic visits reported during

the applicable base year period were to uninsured individuals. The

commissioner may retrospectively reduce the bad debt and charity care

allowance of a diagnostic and treatment center if it is determined that

provider management actions or decisions have caused a significant

reduction for the rate period in the delivery of comprehensive primary

health care services to bad debt and charity care residents of the

community.

(ii) The total amount of funds to be allocated and distributed for bad

debt and charity care allowances to eligible voluntary and nonprofit

diagnostic and treatment centers for a rate period in accordance with

this paragraph shall be limited to an annual aggregate amount of seven

million three hundred thousand dollars. The total amount of funds to be

allocated and distributed for bad debt and charity care allowances to

eligible publicly sponsored diagnostic and treatment centers for a rate

period in accordance with this paragraph shall be limited to an annual

aggregate amount of seven million seven hundred thousand dollars;

provided, however, that twenty percent of the amount of funds allocated

for distribution to eligible publicly sponsored diagnostic and treatment

centers shall be available for clinics operating under the auspices of

the Health and Hospitals Corporation. Notwithstanding the foregoing and

any other provision of this chapter municipalities which received state

aid, pursuant to article two of the public health law and prior to the

effective date of this chapter, in support of non-hospital based

free-standing or local health department operated general medical

clinics, shall receive a bad debt and charity care allowance of not less

than the amount received in the nineteen hundred eighty-nine--nineteen

hundred ninety state fiscal year for general medical clinics, plus the

applicable local share for medical assistance expenditures under title

XIX of the federal social security act. Funds to be distributed pursuant

to this subparagraph shall be based on losses associated with the

delivery of bad debt and charity care excluding the amount of such

losses determined in accordance with subparagraph (ix) of this paragraph

as the incremental loss basis for a supplemental allowance for a

diagnostic and treatment center designated as a preferred primary care

provider.

(iii) No diagnostic and treatment center may receive a bad debt and

charity care allowance in accordance with this paragraph in an amount

which exceeds its need for the financing of losses associated with the

delivery of bad debt and charity care.

(iv) A nominal payment amount for the financing of losses associated

with the delivery of bad debt and charity care will be established for

each eligible diagnostic and treatment center. The nominal payment

amount shall be calculated as the sum of the dollars attributable to the

application of an incrementally increasing nominal coverage percentage

of base year period losses associated with the delivery of bad debt and

charity care for percentage increases in the relationship between base

year period eligible bad debt and charity care clinic visits and base

year period total clinic visits according to the following scale:

% of eligible bad debt and charity care % of nominal financial

clinic visits to total visits loss coverage

up to 15% 50%

15 - 30% 75%

30%+ 100%

If the sum of the nominal payment amounts for all eligible voluntary

non-profit diagnostic and treatment centers or for all eligible public

diagnostic and treatment centers is less than the amount allocated for

bad debt and charity care allowances pursuant to subparagraph (ii) or

(ix) respectively of this paragraph for such diagnostic and treatment

centers respectively, the nominal coverage percentages of base year

period losses associated with the delivery of bad debt and charity care

pursuant to this scale may be increased to not more than one hundred

percent for voluntary non-profit diagnostic and treatment centers or for

public diagnostic and treatment centers in accordance with rules and

regulations adopted by the council and approved by the commissioner.

(v) The bad debt and charity care allowance for each eligible

voluntary non-profit diagnostic and treatment center shall be based on

the dollar value of the result of the ratio of total funds allocated for

bad debt and charity care allowances for voluntary non-profit diagnostic

and treatment centers pursuant to subparagraph (ii) of this paragraph to

the total statewide nominal payment amounts for all eligible voluntary

non-profit diagnostic and treatment centers determined in accordance

with subparagraph (iv) of this paragraph applied to the nominal payment

amount for each such diagnostic and treatment center.

(vi) The bad debt and charity care allowance for each eligible public

diagnostic and treatment center shall be based on the dollar value of

the result of the ratio of total funds allocated for bad debt and

charity care allowances for public diagnostic and treatment centers

pursuant to subparagraph (ii) of this paragraph to the total statewide

nominal payment amounts for all eligible public diagnostic and treatment

centers determined in accordance with subparagraph (iv) of this

paragraph applied to the nominal payment amount for each such diagnostic

and treatment center.

(vii) Diagnostic and treatment centers shall furnish to the department

such reports and information as may be required by the commissioner to

assess the cost, quality, access to, effectiveness and efficiency of bad

debt and charity care provided. The council shall adopt rules and

regulations, subject to the approval of the commissioner, to establish

uniform reporting and accounting principles designed to enable

diagnostic and treatment centers to fairly and accurately determine and

report bad debt and charity care visits and the costs of bad debt and

charity care. In order to be eligible for an allowance pursuant to this

paragraph, a diagnostic and treatment center must be in compliance with

bad debt and charity care reporting requirements.

(viii) Of the funds allocated and distributed for bad debt and charity

care allowances to eligible voluntary and non-profit diagnostic and

treatment centers for a rate period in accordance with subparagraph (ii)

of this paragraph, an annual aggregate amount not to exceed three

million eight hundred thousand dollars within a rate period shall be

paid by or on behalf of diagnostic and treatment centers into a primary

care initiative pool established by the commissioner. Such funds shall

be distributed to diagnostic and treatment centers in accordance with

the provisions of subdivisions one through six of section twenty-eight

hundred seven-b of this article.

(ix) During the period January first, nineteen hundred ninety-four

through September thirtieth, nineteen hundred ninety-four and for each

twelve month rate period commencing on October first thereafter, to the

extent of funds available therefor, a diagnostic and treatment center

which is approved as a preferred primary care provider pursuant to

subdivision twelve of section twenty-eight hundred seven of this article

and meets the requirements of this paragraph may be eligible for a

supplemental allowance determined in accordance with this paragraph. The

supplemental allowance shall be based on losses associated with the

delivery of bad debt and charity care incurred by a preferred primary

care provider to the extent such losses exceed any losses associated

with the delivery of bad debt and charity care incurred for nineteen

hundred ninety-three or, if later, the year immediately preceding the

year in which the diagnostic and treatment center is first designated a

preferred primary care provider.

(x) This paragraph shall be effective if, and as long as, federal

financial participation is available for expenditures made for

beneficiaries eligible for medical assistance under title XIX of the

federal social security act based upon the allowances determined in

accordance with this paragraph.

(xi) Notwithstanding any inconsistent provision of this paragraph,

adjustments to rates of payment for diagnostic and treatment centers

determined in accordance with subparagraphs (i) through (x) of this

paragraph shall apply only for services provided on or before December

thirty-first, nineteen hundred ninety-six.

* NB Expired December 31, 1996

(g)(i) During the period April first, nineteen hundred ninety-four

through December thirty-first, nineteen hundred ninety-four and for each

calendar year rate period commencing on January first thereafter, rates

of payment by governmental agencies for the operating cost component of

general hospital outpatient services shall be based on the operating

costs reported in the base year cost report adjusted by the trend factor

applicable to the general hospital in which the services were provided;

provided, however, that the maximum payment for the operating cost

component of outpatient services shall be sixty-seven dollars and fifty

cents plus the addition of the capital cost per visit. The capital cost

per visit shall be based on the base year cost report except that the

capital cost per visit may be adjusted for major outpatient capital

expenditures incurred subsequent to the reporting year, when such

expenditures have received the requisite approvals and the facility has

provided the commissioner with a certified statement of the

expenditures. The base year for the period April first, nineteen hundred

ninety-four through December thirty-first, nineteen hundred ninety-four

shall be nineteen hundred ninety-two and shall be advanced one year

thereafter for each subsequent calendar year rate period. Further, the

provisions of subdivision seven of this section shall not apply. The

commissioner may waive the maximum allowable payment and limitations on

the rate of payment as prescribed herein to provide for the

reimbursement of offering and arranging services eligible for ninety

percent federal funds as set forth in section nineteen hundred three of

the federal social security act, and to provide for the reimbursement of

specialized services having separately identifiable costs and

statistics, including but not limited to hemodialysis services and

surgical services provided on an outpatient basis. Such waiver shall be

granted only when the commissioner finds that the services are being

provided efficiently and at minimum cost. The commissioner shall

promptly promulgate rules and regulations necessary to identify such

services. Among the criteria which the commissioner shall consider in

the case of specialized services are whether the services require highly

specialized staff, equipment or facilities, thereby generating a cost

that substantially exceeds that of more routine diagnostic or treatment

services; whether the facility in which the services are provided is

presently providing the services to the population in need; and, whether

the services may be provided safely and effectively on an outpatient

basis at a lower cost than through inpatient admission. In addition the

commissioner shall provide for a waiver of the maximum allowable payment

for those outpatient services medically necessary which include surgical

procedures where delay in surgical intervention would substantially

increase the medical risk associated with such surgical intervention.

Where the commissioner waives the maximum allowable payment for any

specified service he may, in accordance with the foregoing criteria and

such other criteria as he deems appropriate, establish a maximum

allowable payment for such specified service.

(ii) During the period April first, nineteen hundred ninety-four

through December thirty-first, nineteen hundred ninety-four and for each

calendar year rate period commencing on January first thereafter, rates

of payment by governmental agencies for the operating cost component of

general hospital emergency services shall be based on the operating

costs reported in the base year cost report adjusted by the trend factor

applicable to the general hospital in which the services were provided,

and in addition shall include that portion of the reasonable incremental

emergency service operating costs incurred by such hospital in excess of

emergency service costs reported in the nineteen hundred eighty-eight

cost report, after application of the trend factor, attributable to

meeting additional quality of care standards for emergency services that

became effective on or after January first, nineteen hundred

eighty-nine; provided, however, that the maximum payment for the

operating component shall be ninety-five dollars, provided further,

however, that for the period January first, two thousand seven through

December thirty-first, two thousand seven the maximum payment for the

operating component shall be one hundred twenty-five dollars, and during

the period January first, two thousand eight through December

thirty-first, two thousand eight, the maximum payment for the operating

component shall be one hundred forty dollars; and during the period

January first, two thousand nine through December thirty-first, two

thousand nine and for each calendar year thereafter, the maximum payment

for the operating component shall be one hundred fifty dollars. A

capital cost per visit shall be based on the base year cost report

except that the capital cost per visit may be adjusted for the major

outpatient capital expenditures incurred subsequent to the report year,

when such expenditures have received the requisite approvals and the

facility has provided the commissioner with a certified statement of

expenditures. The base year for the period April first, nineteen hundred

ninety-four through December thirty-first, nineteen hundred ninety-four

shall be nineteen hundred ninety-two and shall be advanced one year

thereafter for each subsequent calendar year rate period. Further, the

provisions of subdivision seven of this section shall not apply prior to

January first, two thousand seven.

* (iii) (A) For purposes of this subparagraph:

(1) "Children with medical fragility" shall mean an individual who is

under twenty-one years of age and has a chronic debilitating condition

or conditions, who may or may not be hospitalized or institutionalized,

and who meets one or more of the following criteria: (I) is

technology-dependent for life or health sustaining functions; (II)

requires complex medication regimens or medical interventions to

maintain or to improve their health status; or (III) is in need of

ongoing assessment or intervention to prevent serious deterioration of

their health status or medical complications that place their life,

health or development at risk.

(2) "Pediatric residential health care facility" shall mean a

free-standing facility or discrete unit within a facility authorized by

the commissioner to provide extensive nursing, medical, psychological,

and counseling support services solely to children under the age of

twenty-one.

(3) "Pediatric diagnostic and treatment center" shall mean a

diagnostic and treatment center established pursuant to this article,

which as of April first, two thousand twenty-four, has been

participating in the demonstration program authorized under subdivision

one of section twenty-eight hundred eight-e of this article, for which

at least eighty percent of its total Medicaid fee-for-service

reimbursements derive from the provision of services to children under

the age of twenty-one with medical fragility and is affiliated with a

pediatric residential health care facility.

(B) (1) Notwithstanding any law, rule, or regulation to the contrary,

the commissioner shall establish rates of reimbursement for pediatric

diagnostic and treatment centers for all services provided on or after

April first, two thousand twenty-four, to children eligible for medical

assistance that reflect the costs necessary to provide care and services

to children with medical fragility being treated at such pediatric

diagnostic and treatment center.

(2) For the period April first, two thousand twenty-four, to December

thirty-first, two thousand twenty-four, and until such time as a

certified annual cost report for such period is received and verified by

the department, the operating component of such rate shall reflect

budgeted costs for the period January first, two thousand twenty-four,

through December thirty-first, two thousand twenty-four, as submitted to

the department and adjusted as the commissioner deems appropriate. Upon

submission and subsequent verification of the cost report, the operating

component of the rate shall be reflective of actual costs for the period

January first, two thousand twenty-four, through December thirty-first,

two thousand twenty-four, subject to further adjustments as the

commissioner deems appropriate. Thereafter, the base period reported

operating costs used to establish rates pursuant to this subparagraph

shall be updated no less frequently than every two years. In addition to

required annual cost reports, pediatric diagnostic and treatment

centers, as defined by this subparagraph, shall submit additional data

as the commissioner requires.

(3) Notwithstanding any law, rule, or regulation to the contrary,

pediatric diagnostic and treatment centers shall be reimbursed for

services provided to children enrolled in Medicaid managed care plans at

the rates of reimbursement promulgated pursuant to this subparagraph.

(4) The capital component of the rate shall reflect actual base year

costs.

(5) All rates established under this subparagraph shall be subject to

the availability of federal financial participation.

(6) The commissioner may promulgate or amend regulations as the

commissioner determines appropriate and necessary to establish the rates

provided for in this subparagraph and/or exempt pediatric diagnostic and

treatment centers from the ambulatory payment group reimbursement

methodology applicable to diagnostic and treatment centers.

* NB Repealed April 1, 2029

(h) Notwithstanding any inconsistent provisions of this subdivision or

any other law, except as provided in section 43.02 of the mental hygiene

law, the commissioner may, in accordance with rules and regulations

adopted by the council and approved by the commissioner, establish rates

of reimbursement for payments made by governmental agencies, subject to

the approval of the state director of the budget, for services provided

on an outpatient basis by a general hospital or diagnostic and treatment

center designated as a preferred primary care provider pursuant to

subdivision twelve of this section or providing specialty services

including hemo and peritoneal dialysis, outpatient rehabilitative and

psychiatric services, methadone maintenance, and other organized

outpatient or clinic services which are structured to address extensive

and complex medical needs for patients with chronic or infectious

medical conditions based on factors other than those prescribed by

paragraph (b) or subparagraph (i) of paragraph (g) of this subdivision

or subdivision three of this section provided, however, that the use of

such an alternative approach will not result in any increase to other

rates of reimbursement established pursuant to this article. During the

initial rate period such rates of payment for preferred primary care

providers shall be at least equal to the average rate of payment per

visit which would otherwise be provided pursuant to subparagraph (i) of

paragraph (g) or paragraph (b) of this subdivision. Factors used to

establish rates shall include a reasonable classification of medical

procedures with individual or combined rates established for each

service classification group which will be prospectively determined

based upon an estimate of the costs of such outpatient services

efficiently and economically provided by general hospitals and

diagnostic and treatment centers, considering regional economic factors

and the need for incentives to improve services and institute economies.

Notwithstanding any inconsistent provisions of law, rates of payment by

governmental agencies for outpatient services provided by a general

hospital or diagnostic and treatment center, shall not require a

certification by the commissioner that they are reasonable and adequate

to meet the costs which must be incurred by efficiently and economically

operated facilities.

2-a. Notwithstanding any provision of which is inconsistent with or

contrary to the structure established by this subdivision and

subdivision thirty-three of section twenty-eight hundred seven-c of this

article, and subject to the availability of federal financial

participation, rates of payment by governmental agencies, established

pursuant to this article, for general hospital outpatient services,

general hospital emergency services, ambulatory surgical services

provided by a hospital as defined by subdivision one of section

twenty-eight hundred one of this article, and diagnostic and treatment

center services, but excepting any facility whose reimbursement is

governed by subdivision eight of this section or any payments made on

behalf of persons enrolled in Medicaid managed care or in the family

health plus program, shall be in accordance with the following:

(a)(i) for the period December first, two thousand eight through

November thirtieth, two thousand nine, seventy-five percent of such

rates of payment for each general hospital's outpatient services shall

reflect the average Medicaid payment per claim, as determined by the

commissioner, for services provided by that facility in the two thousand

seven calendar year, but excluding any payments for services covered by

the facility's licensure, if any, under the mental hygiene law, and

twenty-five percent of such rates of payment shall, for the operating

cost component, reflect the utilization of the ambulatory patient groups

reimbursement methodology described in paragraph (e) of this

subdivision;

(ii) for the period December first, two thousand nine through December

thirty-first, two thousand ten, fifty percent of such rates for each

facility shall reflect the average Medicaid payment per claim, as

determined by the commissioner, for services provided by that facility

in the two thousand seven calendar year, but excluding any payments for

services covered by the facility's licensure, if any, under the mental

hygiene law, and fifty percent of such rates of payment shall, for the

operating cost component, reflect the utilization of the ambulatory

patient groups reimbursement methodology described in paragraph (e) of

this subdivision;

(iii) for the period January first, two thousand eleven through

December thirty-first, two thousand eleven, twenty-five percent of such

rates shall reflect the average Medicaid payment per claim, as

determined by the commissioner, for services provided by that facility

for the two thousand seven calendar year, but excluding any payments for

services covered by the facility's licensure, if any, under the mental

hygiene law, and seventy-five percent of such rates of payment shall,

for the operating cost component, reflect the utilization of the

ambulatory patient groups reimbursement methodology described in

paragraph (e) of this subdivision; and

(iv) for periods on and after January first, two thousand twelve, one

hundred percent of such rates of payment shall reflect the utilization

of the ambulatory patient groups reimbursement methodology described in

paragraph (e) of this subdivision.

(v) This paragraph shall be effective the later of: (i) December

first, two thousand eight, or (ii) after the commissioner receives final

approval of federal financial participation in payments made for

beneficiaries eligible for medical assistance under title XIX of the

federal social security act for the rate methodology established

pursuant to subparagraph (i) of paragraph (a) of subdivision

thirty-three of section twenty-eight hundred seven-c of this article.

(b) (i) for the period September first, two thousand nine through

November thirtieth, two thousand nine, seventy-five percent of such

rates of payment for services provided by each diagnostic and treatment

center and each free-standing ambulatory surgery center shall reflect

the average Medicaid payment per claim, as determined by the

commissioner, for services provided by that facility in the two thousand

seven calendar year, but excluding any payments for services covered by

the facility's licensure, if any, under the mental hygiene law, and

twenty-five percent of such rates of payment shall, for the operating

cost component, reflect the utilization of the ambulatory patient groups

reimbursement methodology described in paragraph (e) of this

subdivision;

(ii) for the period December first, two thousand nine through December

thirty-first, two thousand ten, fifty percent of such rates for each

facility shall reflect the average Medicaid payment per claim, as

determined by the commissioner, for services provided by that facility

in the two thousand seven calendar year, but excluding any payments for

services covered by the facility's licensure, if any, under the mental

hygiene law, and fifty percent of such rates of payment shall, for the

operating cost component, reflect the utilization of the ambulatory

patient groups reimbursement methodology described in paragraph (e) of

this subdivision;

(iii) for the period January first, two thousand eleven through

December thirty-first, two thousand eleven, twenty-five percent of such

rates for each facility shall reflect the average Medicaid payment per

claim, as determined by the commissioner, for services provided by that

facility in the two thousand seven calendar year, but excluding any

payments for services covered by the facility's licensure, if any, under

the mental hygiene law, and seventy-five percent of such rates of

payment shall, for the operating cost component, reflect the utilization

of the ambulatory patient groups reimbursement methodology described in

paragraph (e) of this subdivision; and

(iv) for periods on and after January first, two thousand twelve, one

hundred percent of such rates of payment shall reflect the utilization

of the ambulatory patient groups reimbursement methodology described in

paragraph (e) of this subdivision.

(c) for periods on and after December first, two thousand eight, such

rates of payment for ambulatory surgical services provided by general

hospitals shall reflect the utilization of the ambulatory patient groups

reimbursement methodology described in paragraph (e) of this

subdivision, provided however, that the capital cost component for such

rates shall be separately computed in accordance with regulations

promulgated in accordance with paragraph (e) of this subdivision.

(d) for periods on and after January first, two thousand nine, the

operating cost component of such rates of payment for general hospital

emergency services shall reflect the utilization of the ambulatory

patient groups reimbursement methodology described in paragraph (e) of

this subdivision and shall not reflect any maximum payment amount as

otherwise provided for in subparagraph (ii) of paragraph (g) of

subdivision two of this section.

(e) (i) notwithstanding any inconsistent provisions of this

subdivision, the commissioner shall promulgate regulations establishing,

subject to the approval of the state director of the budget,

methodologies for determining rates of payment for the services

described in this subdivision. Such regulations shall reflect

utilization of the ambulatory patient group (APG) methodology, in which

patients are grouped based on their diagnosis, the intensity of the

services provided and the medical procedures performed, and with each

APG assigned a weight reflecting the projected utilization of resources.

Such regulations shall provide for the development of one or more base

rates and the multiplication of such base rates by the assigned weight

for each APG to establish the appropriate payment level for each such

APG. Such regulations may also utilize bundling, packaging and

discounting mechanisms.

If the commissioner determines that the use of the APG methodology is

not, or is not yet, appropriate or practical for specified services, the

commissioner may utilize existing payment methodologies for such

services or may promulgate regulations, and may promulgate emergency

regulations, establishing alternative payment methodologies for such

services.

(ii) Notwithstanding this subdivision and any other contrary provision

of law, the commissioner may incorporate within the payment methodology

described in subparagraph (i) of this paragraph payment for services

provided by facilities pursuant to licensure under the mental hygiene

law, provided, however, that such APG payment methodology may be phased

into effect in accordance with a schedule or schedules as jointly

determined by the commissioner, the commissioner of mental health, the

commissioner of alcoholism and substance abuse services, and the

commissioner of the office for people with developmental disabilities.

(iii) Regulations issued pursuant to this paragraph may incorporate

quality related measures limiting or excluding reimbursement related to

potentially preventable conditions and complications; provided however,

such quality related measures shall not include any preventable

conditions and complications not identified for Medicare nonpayment or

limited payment.

* (iv) Effective April first, two thousand twenty, regulations issued

pursuant to this paragraph for public general hospitals or public health

systems, other than those operated by the state of New York or the state

university of New York, located in a city having a population of one

million or more shall reflect additional reimbursement for costs, to the

extent permitted under 42 CFR 447.321(b)(1) and based on actual

utilization of services. Such rate add-on shall be contingent upon

federal financial participation and approval, and subject to the terms

of a binding memorandum of understanding executed between the department

of health and the public general hospital or public health system

receiving the rate add-on. If payment of such rate add-on is projected

to cause Medicaid disbursements for such period to exceed the projected

department of health Medicaid state funds in the enacted budget

financial plan pursuant to subdivision three of section twenty-three of

the state finance law, as determined by the director of the budget, or

the memorandum of understanding is not executed or is breached, the

commissioner, in consultation with the director of the budget, may

either cancel or reduce payment of such rate add-on to achieve

compliance with the enacted budget financial plan.

* NB Repealed March 31, 2029

(f)(i) The commissioner shall periodically measure the utilization and

intensity of services provided to medical assistance recipients in

ambulatory settings. Such analysis shall include, but not be limited to:

measurement of the shift of surgical procedures from the inpatient

hospital setting to the ambulatory setting including measurement of the

impact of any such shift on quality of care and outcomes; changes in the

utilization and intensity of services provided in the outpatient

hospital department and in diagnostic and treatment centers; and the

change in the utilization and intensity of services provided in the

emergency department.

(ii) notwithstanding the provisions of paragraphs (a) and (b) of this

subdivision, for periods on and after January first, two thousand nine,

the following services provided by general hospital outpatient

departments and diagnostic and treatment centers shall be reimbursed

with rates of payment based entirely upon the ambulatory patient group

methodology as described in paragraph (e) of this subdivision, provided,

however, that the commissioner may utilize existing payment

methodologies or may promulgate regulations establishing alternative

payment methodologies for one or more of the services specified in this

subparagraph, effective for periods on and after March first, two

thousand nine:

(A) services provided in accordance with the provisions of paragraphs

(q), (r), and (ll) of subdivision two of section three hundred

sixty-five-a of the social services law; and

(B) all services, but only with regard to additional payment amounts,

as determined in accordance with regulations issued in accordance with

paragraph (e) of this subdivision, for the provision of such services

during times outside the facility's normal hours of operation, as

determined in accordance with criteria set forth in such regulations;

and

(C) services provided by licensed social workers, licensed mental

health counselors, and licensed marriage and family therapists, in

accordance with licensing criteria set forth in applicable regulations;

and

(D) individual psychotherapy services provided by licensed social

workers, in accordance with licensing criteria set forth in applicable

regulations, at diagnostic and treatment centers that provided, billed

for, and received payment for these services between January first, two

thousand seven and December thirty-first, two thousand seven;

(E) services provided to pregnant women pursuant to paragraph (s) of

subdivision two of section three hundred sixty-five-a of the social

services law and, for periods on and after January first, two thousand

ten, all other services provided pursuant to such paragraph (s) and

services provided pursuant to paragraph (t) of subdivision two of

section three hundred sixty-five-a of the social services law;

(F) wheelchair evaluation services and eyeglass dispensing services;

and

(G) immunization services, effective for services rendered on and

after June tenth, two thousand nine.

(f-1) Notwithstanding any inconsistent provision of this section or

any other contrary provision of law, the commissioner may with the

approval of the director of the budget, for periods prior to two

thousand twelve, establish rates of payments for selected patient

service categories that are based entirely upon the ambulatory patient

groups methodology as authorized pursuant to paragraph (e) of this

subdivision.

(g) for the purposes set forth in paragraphs (a) and (b) of this

subdivision, rates described as in effect for the two thousand seven

calendar year shall mean those rates which are in effect for that year

on the date this subdivision becomes effective and such rates shall not

thereafter, for the purposes set forth in such paragraphs (a) and (b),

be subject to further adjustment.

(h)(i) To the degree that rates of payment computed in accordance with

paragraphs (a) and (d) of this subdivision reflect utilization of the

ambulatory patient groups reimbursement methodology described in

paragraph (e) of this subdivision for purposes of computing the

operating component of such rates, the computation of the capital cost

component of such rates shall remain subject to the provisions of

subparagraphs (i) and (ii) of paragraph (g) of subdivision two of this

section, provided, however, that this subparagraph shall not be

understood as applying to those portions of rates of payment computed

pursuant to paragraph (a) of this subdivision which are based on average

Medicaid payments per claim.

(ii) To the degree that rates of payment computed in accordance with

paragraph (b) of this subdivision reflect utilization of the ambulatory

patient groups reimbursement methodology described in paragraph (e) of

this subdivision for purposes of computing the operating component of

such rates, the computation of the capital cost component of such rates

shall, for diagnostic and treatment centers, remain subject to the

provisions of paragraph (b) of subdivision two of this section and

shall, for free-standing ambulatory surgery centers, be separately

computed in accordance with regulations promulgated in accordance with

paragraph (e) of this subdivision, provided, however, that this

subparagraph shall not be understood as applying to those portions of

rates of payment which are based on average Medicaid payments per claim.

(i) Notwithstanding any provision of law to the contrary, rates of

payment by governmental agencies for general hospital outpatient

services, general hospital emergency services and ambulatory surgical

services provided by a general hospital established pursuant to

paragraphs (a), (c) and (d) of this subdivision shall result in an

aggregate increase in such rates of payment of fifty-six million dollars

for the period December first, two thousand eight through March

thirty-first, two thousand nine and one hundred seventy-eight million

dollars for periods after April first, two thousand nine, through March

thirty-first, two thousand thirteen, and one hundred fifty-three million

dollars for state fiscal year periods on and after April first, two

thousand thirteen, provided, however, that for periods on and after

April first, two thousand nine, such amounts may be adjusted to reflect

projected decreases in fee-for-service Medicaid utilization and changes

in case-mix with regard to such services from the two thousand seven

calendar year to the applicable rate year, and provided further,

however, that funds made available as a result of any such decreases may

be utilized by the commissioner to increase capitation rates paid to

Medicaid managed care plans and family health plus plans to cover

increased payments to health care providers for ambulatory care services

and to increase such other ambulatory care payment rates as the

commissioner determines necessary to facilitate access to quality

ambulatory care services.

3. Commissioner rate certification, governmental payments. Prior to

the approval of such rates, as provided in subdivision two of this

section, the commissioner shall determine, and in the case of approvals

by the state director of the budget, certify to such official that the

proposed rate schedules for payments to hospitals for hospital and

health-related services are reasonable and adequate to meet the costs

which must be incurred by efficiently and economically operated

facilities. In making such certification, the commissioner shall take

into consideration the elements of cost, geographical differentials in

the elements of cost considered, economic factors in the area in which

the hospital is located, the rate of increase or decrease of the economy

in the area in which the hospital is located, costs of hospitals of

comparable size, and the need for incentives to improve services and

institute economies. The commissioner shall also take into

consideration the economies and improvements in service to be

anticipated from the operation of joint central service or use of

facilities or services which may serve as alternatives or substitutes

for the whole or any part of in-hospital service, including, but not

limited to, obstetrical, pediatric, laboratory, training, radiology,

pharmacy, laundry, purchasing, preadmission, nursing home, ambulatory or

home care services. The commissioner shall exclude costs for research

and those parts of the costs for educational salaries which the

commissioner shall determine to be not directly related to hospital

service, and allowances for costs which are not specifically identified

except for allowances authorized under section twenty-eight hundred

seven-a or twenty-eight hundred seven-c of this article. In determining

and certifying to the state director of the budget rates of payment,

including rates of payment for residential health care facilities, the

commissioner shall take into consideration the different levels of care

authorized to be provided in such hospital or health-related service and

determine and certify distinct rates of payment for each such level of

care. If the modification of an operating certificate of a hospital

pursuant to subdivision six of section twenty-eight hundred six of this

article requires the establishment of a rate for a level of service not

previously provided in such hospital during the rate period existing at

the time of such modification, a new rate period for that portion of the

hospital reclassified as a result of such modification may be

established upon sixty days' prior notice.

4. Commissioner rate certifications, payments pursuant to the

provisions of the workers' compensation law, the volunteer firefighters'

benefit law, the volunteer ambulance workers' benefit law and the

comprehensive motor vehicle insurance reparations act. For the rate

years commencing January first, nineteen hundred eighty-six and January

first, nineteen hundred eighty-seven the commissioner shall submit to

the chairman of the workers' compensation board a schedule of hospital

inpatient reimbursement rates computed in accordance with subdivision

two of section twenty-eight hundred seven-a of this article or as

revised pursuant to subdivisions eleven and fourteen of section

twenty-eight hundred seven-a of this article. Beginning with the rate

period commencing January first, nineteen hundred eighty-eight the

commissioner shall submit, and beginning with the rate period January

first, nineteen hundred ninety-seven and certify, to the chairman of the

workers' compensation board for an established rate period a schedule of

hospital inpatient reimbursement rates computed in accordance with

subdivision one of section twenty-eight hundred seven-c of this article

for payments pursuant to the workers' compensation law, the volunteer

firefighters' benefit law and the comprehensive motor vehicle insurance

reparations act and beginning with the rate year commencing January

first, nineteen hundred ninety-one including payments pursuant to the

volunteer ambulance workers' benefit law.

5. Audit authority. The commissioner shall make available to the

commissioner of social services, in a mutually satisfactory manner, all

information necessary to conduct or have conducted, on a cost sharing

basis among payors, an appropriate review or audit of the fiscal and

statistical records of a hospital necessary to implement the provisions

of this article.

6. Consideration of economic status in certain cases. Notwithstanding

the provisions of this section, the commissioner, in determining and

certifying rates of payment for services provided by a party to a

contract entered into pursuant to the provisions of subdivision three of

section twenty-eight hundred three of this article, shall take into

consideration the economic status of the patients receiving such

services.

7. Reimbursement rate promulgation. The commissioner shall notify each

residential health care facility and health-related service of its

approved rates of payment which shall be used in reimbursing for

services provided to persons eligible for payments made by state

governmental agencies at least sixty days prior to the beginning of an

established rate period for which the rate is to become effective and

for general hospitals at least thirty days prior to the beginning of an

established rate period for which the rate is to become effective.

Notification shall be made only after approval of rate schedules by the

state director of the budget. The sixty and thirty day notice

provisions, herein, shall not apply to rates issued following judicial

annulment or invalidation of any previously issued rates, or rates

issued pursuant to changes in the methodology used to compute rates

which changes are promulgated following the judicial annulment or

invalidation of previously issued rates. Notwithstanding any provision

of law to the contrary, nothing in this subdivision shall prohibit the

recalculation and payment of rates, including both positive and negative

adjustments, based on a reconciliation of amounts paid by residential

health care facilities beginning April first, nineteen hundred

ninety-seven for additional assessments or further additional

assessments pursuant to section twenty-eight hundred seven-d of this

article with the amounts originally recognized for reimbursement

purposes.

7-a. Notwithstanding any inconsistent provision of law, with regard to

a general hospital the provisions of subdivisions four and seven of this

section and the provisions of section eighteen of chapter two of the

laws of nineteen hundred eighty-eight relating to the requirement of

prior notice and the time frames for notice, approval or certification

of rates of payment, maximum rates of payment or maximum charges where

not otherwise waived pursuant to law shall be applicable only to such

rates of payment or maximum charges prospectively established for an

annual rate period and such provisions shall not be applicable to a

general hospital with regard to prospective adjustments or retrospective

adjustments of established rates of payment or maximum charges for or

during an annual rate period based on correction of errors or omissions

of data or in computation, rate appeals, audits or other rate

adjustments authorized by law or regulations adopted pursuant to section

twenty-eight hundred three of this article.

7-b. Notification of diagnostic and treatment center approved rates.

(a) For rate periods or portions of rate periods beginning on or after

October first, nineteen hundred ninety-four, the commissioner shall

notify each diagnostic and treatment center of its approved rates of

payment, which shall be used in the reimbursement for services provided

to persons eligible for payments made by state governmental agencies at

least thirty days prior to the beginning of the period for which such

rates are to become effective.

(b) Notwithstanding any contrary provision of law, all diagnostic and

treatment centers certified on or before September second, nineteen

hundred ninety-seven shall, not later than September second, nineteen

hundred ninety-seven, notify the commissioner whether they intend to

maintain all books and records utilized by the diagnostic and treatment

center for cost reporting and reimbursement purposes on a calendar year

basis or, commencing on July first, nineteen hundred ninety-six, on a

July first through June thirtieth basis, and shall thereafter maintain

all books and records on such basis. All diagnostic and treatment

centers certified after September second, nineteen hundred ninety-seven

shall notify the commissioner at the time of certification whether they

intend to maintain all books and records on a calendar year basis or on

or a July first through June thirtieth basis, and shall thereafter

maintain all books and records on such a basis.

(c) The books and records maintained pursuant to paragraph (b) of this

subdivision shall be utilized and made available to the commissioner in

promulgating rates of payment for annual rate periods beginning on or

after October first, nineteen hundred ninety-seven.

(d) Notwithstanding any provision of the law to the contrary, rates of

payment established in accordance with paragraph (b) as amended, and

paragraph (f) of subdivision two of this section for the rate period

beginning April first, nineteen hundred ninety-three shall continue in

effect through September thirtieth, nineteen hundred ninety-four, and

applicable trend factors shall be applied to that portion of such rates

of payment for the rate period which begins April first, nineteen

hundred ninety-four.

8. Rates for federally qualified health centers and rural health

centers. Notwithstanding section four of chapter eighty-one of the laws

of nineteen hundred ninety-five, as amended by section twenty-seven of

chapter one of the laws of nineteen hundred ninety-nine, and any other

law, rule or regulation to the contrary, for periods on and after

January first, two thousand one, rates of payment made by governmental

agencies for services provided by diagnostic and treatment centers or

general hospital outpatient clinics licensed under this article to

individuals eligible for medical assistance pursuant to title eleven of

article five of the social services law which are also designated, in

accordance with 42 USC § 1396a(aa), as federally qualified health

centers or rural health centers shall be established in accordance with

the following:

(a) For periods on and after January first, two thousand one, and

prior to October first, two thousand one, such rates of payment shall be

computed in accordance with paragraph (b) of subdivision two of this

section, provided, however, that the operating and capital cost

components of such rates and the applicable ceilings on allowable

operating costs shall reflect an average of nineteen hundred ninety-nine

and two thousand base year costs as reported to the department.

(b) For each twelve month period following September thirtieth, two

thousand one, the operating cost component of such rates of payment

shall reflect the operating cost component in effect on September

thirtieth of the prior period as increased by the percentage increase in

the Medicare Economic Index as computed in accordance with the

requirements of 42 USC § 1396a(aa)(3) and as adjusted pursuant to

applicable regulations to take into account any increase or decrease in

the scope of services furnished by the facility.

(c) Rates of payments to facilities which first qualify as federally

qualified health centers or rural health centers on or after October

first, two thousand shall be computed in accordance with the provisions

of paragraph (b) of subdivision two of this section, provided, however,

that the operating cost component of such rates shall reflect an average

of the operating cost component of rates of payments issued to other

facilities subject to this subdivision during the same rate period,

located in the same geographic region and with a similar case load, and

further provided that the capital cost component of such rates shall

reflect the most recently available capital cost data as reported to the

department. For each twelve month period following the rate period in

which such facilities commence operation, the operating cost component

of rates of payment for such facilities shall be computed in accordance

with paragraph (b) of this subdivision. In calculating the operating

cost component of such rates for facilities which first qualify as

federally qualified health care centers on or after October first, two

thousand, the counties comprising the geographic region known as

downstate shall be the same as the counties comprising the downstate

region for purposes of reimbursing diagnostic and treatment centers

under ambulatory patient groups, which counties are specified in the

regulations adopted by the commissioner implementing section 18 of part

C of chapter fifty-eight of the laws of two thousand eight.

(d) Subject to receipt of all necessary federal approvals, rates of

payment computed in accordance with this subdivision may be further

adjusted in accordance with the provisions of subdivision seventeen of

this section, provided, however, that such adjustments shall not be

subject to trend adjustments as provided in paragraph (b) of this

subdivision.

(e) Diagnostic and treatment centers eligible for rates of payment

computed pursuant to paragraphs (a) and (b) of this subdivision, which

were, on December thirty-first, two thousand, receiving rates of payment

as preferred primary care providers computed pursuant to paragraph (h)

of subdivision two of this section, may elect to continue to receive

rates of payment computed in accordance with such paragraph (h),

provided that in no event shall such rates of payment be less than the

rates of payment computed pursuant to paragraphs (a) and (b) of this

subdivision.

(f) For any rate periods after March thirty-first, two thousand eight,

subject to the availability of federal financial participation, the

commissioner may prospectively adjust rates of payment for facilities

otherwise subject to this subdivision to reflect alternative

rate-setting methodologies, provided, however, that such alternative

rate-setting methodologies must: (i) be authorized by applicable state

law, (ii) be agreed to by the commissioner and each facility to which

they are applied and (iii) in no event result in rates that are, in

aggregate, less than the rates of payment otherwise provided for in this

subdivision.

9. Payments under this section not to preclude other lawful payments.

Any payments made under the authority of this section or section

twenty-eight hundred seven-c of this article shall not preclude payments

under any other section of law.

10. Notwithstanding the provisions of this article, the commissioner

may waive, subject to the approval of the state director of the budget,

the requirements of any provisions of this section, section twenty-eight

hundred seven-a or twenty-eight hundred seven-c of this article to

permit the development and/or continuation of limited pilot

reimbursement programs to provide additional knowledge and experience in

different types of reimbursement mechanisms for general hospitals.

* 11. Notwithstanding the provisions of this article, the commissioner

may waive, subject to the approval of the state director of the budget,

the requirements of any provision of this section, section twenty-eight

hundred seven-a or twenty-eight hundred seven-c of this article to

permit the development, implementation and operation of limited pilot

reimbursement programs for general hospital outpatient services and

diagnostic and treatment center services that would be prospective and

associated to the resource use patterns in rendering ambulatory care

services.

* NB Expired April 1, 2020

12. (a) Notwithstanding any inconsistent provision of this article or

any other law, for the purpose of improving access to and availability

of comprehensive primary health care to persons receiving medical

assistance pursuant to title eleven of article five of the social

services law, the commissioner, upon application by a health care

provider, may designate such provider as a preferred primary care

provider in accordance with the provisions of this subdivision.

(b) Health care providers designated as preferred primary care

providers pursuant to this subdivision shall meet such requirements as

may be established by the commissioner in regulation, including, but not

limited to:

(i) access by the medically indigent and medicaid eligible to

ambulatory services;

(ii) provision, to the maximum extent practicable, of continuity of

care;

(iii) arrangements for specialty physician care and necessary

ancillary services;

(iv) reasonably accessible hours of operation;

(v) services which are accessible to medically underserved populations

and communities including, to the maximum extent feasible, offering such

services within the medically underserved community; and

(vi) participation in local social services district managed care

programs established pursuant to section three hundred sixty-four-j of

the social services law, provided that the commissioner, in consultation

with the commissioner of social services, may exempt a health care

provider from such participation for good cause. Good cause shall

include but not be limited to geographic inaccessibility to managed care

programs, inability to coordinate services of managed care programs, or

that participation in the managed care program would significantly

affect the provider's financial ability to provide services.

(c) For the purposes of this subdivision, a health care provider

eligible to be designated as a preferred primary care provider shall

mean a general hospital, a diagnostic and treatment center, a private

physician, a nurse practitioner, a midwife, a professional corporation

or a group of physicians or nurse practitioners. The designation of any

general hospital or a diagnostic and treatment center as a preferred

primary care provider shall apply only to the specific site where the

entity provides comprehensive primary health care services.

* 13. Subject to the availability of funds, the commissioner shall

authorize health occupation development and workplace demonstration

programs pursuant to the provisions of section two thousand eight

hundred seven-h of this article for diagnostic and treatment centers,

and the commissioner is hereby directed to make rate adjustments to

cover the cost of such programs.

* NB Expired July 1, 2017

* 14. Notwithstanding any inconsistent provision of law or regulation,

for purposes of establishing rates of payment by governmental agencies

for diagnostic and treatment centers for services provided on or after

April first, nineteen hundred ninety-five, the reimbursable base year

administrative and general costs of a provider, excluding a provider

reimbursed on an initial budget basis, shall not exceed the statewide

average of total reimbursable base year administrative and general costs

of diagnostic and treatment centers. For the purposes of this

subdivision, reimbursable base year administrative and general costs

shall mean those base year administrative and general costs remaining

after application of all other efficiency standards, including, but not

limited to, peer group cost ceilings or guidelines. The limitation on

reimbursement for provider administrative and general expenses provided

by this subdivision shall be expressed as a percentage reduction of the

operating cost component of the rate promulgated by the commissioner for

each diagnostic and treatment center with base year administrative and

general costs exceeding the average.

* NB Expired March 31, 2011

15. Notwithstanding any inconsistent provision of law, including

subdivision fourteen of this section, the facility-specific impact of

eliminating the statewide cap on administrative and general costs, as

imposed pursuant to subdivision fourteen of this section, for the period

April first, nineteen hundred ninety-nine through June thirtieth,

nineteen hundred ninety-nine pursuant to a chapter of the laws of

nineteen hundred ninety-nine, shall be included in rates of payment for

facilities affected by such elimination for the period October first,

nineteen hundred ninety-nine through December thirty-first, nineteen

hundred ninety-nine. In addition, rates for diagnostic and treatment

centers for the period October first, nineteen hundred ninety-nine

through December thirty-first, nineteen hundred ninety-nine shall

include, in the aggregate, the sum of fourteen million dollars which

shall be added to rates of payment established in accordance with

paragraphs (b) and (h) of subdivision two of this section based on an

apportionment of such amount using a ratio of each individual provider's

estimated medicaid expenditures to total estimated medicaid expenditures

for diagnostic and treatment centers, as determined by the commissioner,

for the October first, nineteen hundred ninety-nine through September

thirtieth, two thousand rate period.

16. Notwithstanding any inconsistent provision of law, payment for

drugs which may not be dispensed without a prescription as required by

section sixty-eight hundred ten of the education law provided to persons

receiving medical assistance pursuant to title eleven of article five of

the social services law by any non-hospital based diagnostic and

treatment center licensed under this article in existence on the

effective date of this subdivision providing comprehensive primary

medical care services and registered by the state board of pharmacy

pursuant to section sixty-eight hundred eight of the education law shall

be on a fee-for-service basis and shall not be included in any

comprehensive clinic rate paid to such facility by governmental agencies

established in accordance with paragraph (b) of subdivision two of this

section.

17. (a) Notwithstanding any contrary provision of law or regulation,

the commissioner shall, subject to the availability of federal financial

participation, adjust medical assistance rates of payment established

pursuant to paragraph (b) of subdivision two of this section for

free-standing diagnostic and treatment centers licensed pursuant to this

article and which are: a "covered provider" as defined in subdivision

one of section three hundred sixty-four-j-two of the social services

law; or eligible for an allocation under paragraph (a-1) of subdivision

two of section three hundred sixty-four-j-two of the social services

law; or which provides services to individuals with developmental

disabilities as their principal mission, in accordance with paragraphs

(b) and (c) of this subdivision for purposes of improving recruitment

and retention of non-supervisory workers at health care facilities or

any worker with direct patient care responsibility in the following

aggregate amounts for the following periods:

(i) for the period April first, two thousand two through December

thirty-first, two thousand two, thirteen million dollars;

(ii) for the period January first, two thousand three through December

thirty-first, two thousand three, thirteen million dollars;

(iii) for the period January first, two thousand four through December

thirty-first, two thousand four, thirteen million dollars;

(iv) for the period January first, two thousand five through December

thirty-first, two thousand five, thirteen million dollars;

(v) for the period January first, two thousand six through December

thirty-first, two thousand six, thirteen million dollars;

(vi) for the period January first, two thousand seven through June

thirtieth, two thousand seven, six million five hundred thousand

dollars;

(vii) for the period July first, two thousand seven through March

thirty-first, two thousand eight, nine million seven hundred fifty

thousand dollars; and

(viii) thirteen million dollars for the period April first, two

thousand eight through March thirty-first, two thousand nine;

(ix) thirteen million dollars for the period April first, two thousand

nine through March thirty-first, two thousand ten; and

(x) thirteen million dollars for the period April first, two thousand

ten through March thirty-first, two thousand eleven.

(b) Such adjustments to rates of payments shall be allocated

proportionally based on each diagnostic and treatment center's total

annual gross salary and fringe benefit costs, as reported in each such

diagnostic and treatment center's nineteen hundred ninety-nine cost

report as submitted to the department prior to November first, two

thousand one, provided, however, that for periods on and after July

first, two thousand seven, such adjustments to rates of payment shall be

allocated proportionally, based on each such diagnostic and treatment

center's total reported medicaid visits, as reported in each such

diagnostic and treatment center's two thousand four cost report as

submitted to the department prior to January thirty-first, two thousand

seven, to the total of such medicaid visits for all diagnostic and

treatment centers.

(c) Rate adjustments made pursuant to this subdivision shall not be

subject to subsequent adjustment or reconciliation.

(d) Diagnostic and treatment centers which have their rates adjusted

pursuant to this subdivision shall use such funds for the purpose of

recruitment and retention of non-supervisory workers at health care

facilities or any worker with direct patient care responsibility and are

prohibited from using such funds for any other purpose. Each such

diagnostic and treatment center shall submit, at a time and in a manner

to be determined by the commissioner, a written certification attesting

that such funds will be used solely for the purpose of recruitment and

retention of non-supervisory workers at health care facilities or any

worker with direct patient care responsibility. The commissioner is

authorized to audit each such diagnostic and treatment center to ensure

compliance with the written certification required by this paragraph and

shall recoup any funds determined to have been used for purposes other

than recruitment and retention of non-supervisory workers at health care

facilities or any worker with direct patient care responsibility. Such

recoupment shall be in addition to any other penalties provided by law.

18. (a) Notwithstanding any contrary provision of law or regulation,

the commissioner shall, subject to the provisions of paragraph (c) of

this subdivision and to the availability of federal financial

participation, increase medical assistance rates of payment established

pursuant to paragraph (b) of subdivision two of this section for

eligible diagnostic and treatment centers by three percent for services

provided on and after December first, two thousand two for purposes of

improving recruitment and retention of non-supervisory workers or any

worker with direct patient care responsibility.

(b) For the purposes of this subdivision, "eligible diagnostic and

treatment center" shall mean a voluntary, not-for-profit diagnostic and

treatment center licensed under this article that received medical

assistance rates of payment reflecting assignment to limited primary

care or drug free peer groups as established pursuant to applicable

rate-setting regulations and that provides primary health care services

to a patient population primarily comprised of substance abuse patients

and that is ineligible for an adjustment to medical assistance rates of

payment under subdivision seventeen of this section.

(c) Diagnostic and treatment centers which have their rates adjusted

pursuant to this subdivision shall use such funds solely for the purpose

of recruitment and retention of non-supervisory workers or any worker

with direct patient care responsibility and are prohibited from using

such funds for any other purpose. Each such diagnostic and treatment

center shall submit, at a time and in a manner to be determined by the

commissioner, a written certification attesting that such funds will be

used solely for the purpose of recruitment and retention of

non-supervisory workers or any worker with direct patient care

responsibility. The commissioner is authorized to audit each such

diagnostic and treatment center to ensure compliance with the written

certification required by this paragraph and shall recoup any funds

determined to have been used for purposes other than recruitment and

retention of non-supervisory workers or any worker with direct patient

care responsibility. Such recoupment shall be in addition to any other

penalties provided by law.

19. (a) Notwithstanding any provision of law, rule or regulation to

the contrary and subject to the provisions of paragraph (b) of this

subdivision and to the availability of federal financial participation,

the commissioner shall increase medical assistance rates of payment by

three percent for services provided on and after December first, two

thousand two by freestanding methadone maintenance service and program

providers issued operating certificates pursuant to this article and

section 32.09 of the mental hygiene law for the purposes of improving

recruitment and retention of methadone maintenance workers.

(b) Freestanding methadone maintenance services and program providers

which are eligible for rate adjustments pursuant to this subdivision and

which are also eligible for rate adjustments pursuant to subdivision

seventeen of this section, shall, on or before July first, two thousand

two, submit, in a form and manner determined by the commissioner,

amendments to designated sections of their AHCF-1 cost report

segregating wages and fringe benefit costs associated with methadone

maintenance services from all other services for the purposes of

determining awards made pursuant to subdivision seventeen of this

section for rate periods ending in two thousand three and in two

thousand four.

(c) Freestanding methadone maintenance service and program providers

which have their rates adjusted pursuant to this subdivision shall use

such funds solely for the purpose of recruitment and retention of

non-supervisory workers or any worker with direct patient care

responsibility and are prohibited from using such funds for any other

purpose. Each such methadone maintenance service and program provider

shall submit, at a time and in a manner to be determined by the

commissioner, a written certification attesting that such funds will be

used solely for the purpose of recruitment and retention of

non-supervisory workers at such programs or any worker with direct

patient care responsibility. The commissioner is authorized to audit

each such methadone maintenance service and program provider to ensure

compliance with the written certification required by this paragraph and

shall recoup any funds determined to have been used for purposes other

than recruitment and retention of non-supervisory workers or any worker

with direct patient care responsibility. Such recoupment shall be in

addition to any other penalties provided by law.

20. (a) Notwithstanding any contrary provision of law and subject to

the receipt of all necessary federal approvals and the availability of

federal financial participation, the commissioner is authorized to enter

into agreements with SUNY downstate medical center, other public general

hospitals, and/or with the sponsoring local governments of such other

public general hospitals, under which such facilities and/or such local

government shall, by intergovernmental transfer, fund the non-federal

share of Medicaid funds made available for Delivery System Reform

Incentive Payments ("DSRIP") to such facilities. Such non-federal share

payments shall be deemed voluntary and, further, such payments shall be

excluded from computations made pursuant to section one of part C of

chapter fifty-eight of the laws of two thousand five, as amended. In

addition, the facilities, and/or the sponsoring local governments of

such facilities or the state may, by written notification to the other

parties to the agreement, cancel such agreement at any time prior to the

payment of the DSRIP funds. The commissioner shall, to the maximum

degree practicable, and to the extent permitted by the federal Centers

for Medicare and Medicaid Services ("CMS"), ensure that the DSRIP

program is implemented throughout the entire state.

(b) The commissioner shall establish an advisory panel to provide

assistance with regard to the DSRIP program. The panel shall be charged

with reviewing recommendations for DSRIP funding made by the state's

contracted DSRIP assessor and advising the commissioner regarding the

results of such review. Such panel shall also review applications under

paragraph (b) of subdivision two of section twenty-eight hundred

twenty-five of this article. Panel membership shall be comprised of

individuals with significant health care system experience. Members may

not be elected officials or employed by providers that would benefit

from DSRIP funding, and must not have any conflict of interest that

would prevent them from providing an impartial review of DSRIP assessor

recommendations. The panel shall consist of members appointed by the

commissioner and shall in addition consist of one member appointed by

the majority leader of the New York state senate, and one member

appointed by the speaker of the New York state assembly. The panel shall

carry out the review of DSRIP recommendations in strict accordance with

all requirements set forth in the state's federal 1115 Medicaid waiver

standard terms and conditions. The panel shall submit its

recommendations to the commissioner for final determination, in

accordance with all requirements set forth in the state's federal 1115

Medicaid waiver standard terms and conditions. The commissioner may

modify the requirements of this paragraph and paragraph (c) of this

subdivision if such modifications are required by the federal CMS.

(c)(i) Project advisory committees. 1. Lead entities of systems

established under the Medicaid delivery system reform incentive payment

("DSRIP") program shall establish a project advisory committee. The

committee shall consider and advise the entity on matters concerning

system operations, service delivery issues, elimination of health care

disparities, measurement of project outcomes, the degree to which

project goals are being reached and the development of any plans or

programs. The entity may establish rules with respect to its project

advisory committee.

(ii) The members of the committee shall be representatives of the

community, or geographic service areas, served by the system, including

Medicaid consumers attributed to that system, and any other members

required by the terms and conditions of the DSRIP program. The lead

entity shall file with the commissioner, and from time to time update,

an up-to-date list of the members of the committee, which shall be made

available to the public by the department on its website.

(iii) Notwithstanding any inconsistent provision of law, no officer or

employee of the state or of any civil division thereof, shall be deemed

to have forfeited or shall forfeit his or her office or employment by

reason of his or her acceptance of membership on a project advisory

committee. No member of a project advisory committee shall receive

compensation or allowance for services rendered on the committee,

except, however, that members of a committee may be reimbursed by the

entity or system for necessary expenses incurred in relation to service

on a project advisory committee.

(d) For periods on and after April first, two thousand fourteen, the

commissioner shall provide a report on a quarterly basis to the chairs

of the senate finance, assembly ways and means, senate health and

assembly health committees with regard to the status of the DSRIP

program. Such reports shall be submitted no later than sixty days after

the close of the quarter, and shall include the most current information

submitted by providers to the state and the federal CMS. The reports

shall include:

(i) analysis of progress made toward DSRIP goals;

(ii) the impact on the state's health care delivery system;

(iii) information on the number and types of providers who

participate;

(iv) plans and progress for monitoring provider compliance with

requirements;

(v) a status update on project milestone progress;

(vi) information on project spending and budget;

(vii) analysis of impact on Medicaid beneficiaries served;

(viii) a summary of public engagement and public comments received;

(ix) a description of DSRIP funding applications that were denied;

(x) a description of all regulation waivers issued pursuant to

paragraph (f) of this subdivision; and

(xi) a summary of the statewide geographic distribution of funds.

(e) For periods on and after April first, two thousand fourteen the

commissioner shall promptly make all DSRIP governing documents,

including 1115 waiver standard terms and conditions, supporting

attachments and detailed project descriptions, and all materials made

available to the legislature pursuant to paragraph (d) of this

subdivision, available on the department's website. The commissioner

shall also provide a detailed overview on the department's website of

the opportunities for public comment on the DSRIP program.

(f) Notwithstanding any provision of law to the contrary, the

commissioners of the department of health, the office of mental health,

the office for people with developmental disabilities, and the office of

alcoholism and substance abuse services are authorized to waive any

regulatory requirements as are necessary, consistent with applicable

law, to allow applicants under this subdivision and paragraph (a) of

subdivision two of section twenty-eight hundred twenty-five of this

article to avoid duplication of requirements and to allow the efficient

implementation of the proposed project; provided, however, that

regulations pertaining to patient safety may not be waived, nor shall

any regulations be waived if such waiver would risk patient safety. Such

waiver shall not exceed the life of the project or such shorter time

periods as the authorizing commissioner may determine. Any regulatory

relief granted pursuant to this subdivision shall be described,

including each regulation waived and the project it relates to, in the

report provided pursuant to paragraph (d) of this subdivision.

* 20-a. Notwithstanding any provision of law to the contrary, the

commissioners of the department of health, the office of mental health,

the office of people with developmental disabilities, and the office of

alcoholism and substance abuse services are authorized to waive any

regulatory requirements as are necessary, consistent with applicable

law, to allow providers that are involved in DSRIP projects or

replication and scaling activities, as approved by the authorizing

commissioner, to avoid duplication of requirements and to allow the

efficient scaling and replication of DSRIP promising practices, as

determined by the authorizing commissioner; provided however, that

regulations pertaining to patient safety, patient autonomy, patient

privacy, patient rights, due process, scope of practice, professional

licensure, environmental protections, provider reimbursement

methodologies, or occupational standards and employee rights may not be

waived, nor shall any regulations be waived if such waiver would risk

patient safety. Any regulatory action under this subdivision shall be

published on the applicable website of the authorizing commissioner and

shall include a description of each waiver, including a citation of each

regulation waived, and a description of the project of which such relief

was granted.

* NB Expires April 1, 2028

21. (a) Notwithstanding any contrary provision of law and subject to

the receipt of all necessary federal approvals and the availability of

federal financial participation, the commissioner is authorized to enter

into agreements with SUNY downstate medical center, other public general

hospitals, and/or with the sponsoring local governments of such other

public general hospitals, under which such facilities and/or such local

government shall, by intergovernmental transfer, fund the non-federal

share of Medicaid funds made available for implementation of Medicaid

Redesign Team initiatives. Such non-federal share payments shall be

deemed voluntary and, further, such payments shall be excluded from

computations made pursuant to section one of part C of chapter

fifty-eight of the laws of two thousand five, as amended. In addition,

the facilities, and/or the sponsoring local governments of such

facilities or the state may, by written notification to the other

parties to the agreement, cancel such agreement at any time prior to the

payment of the Medicaid Redesign Team initiatives funds.

(b) Applications by eligible applicants for Medicaid Redesign Team

initiatives funded by monies made available pursuant to paragraph (a) of

this subdivision shall be submitted for review to the advisory panel

established pursuant to paragraph (b) of subdivision twenty of this

section and such panel shall submit their recommendations to the

commissioner for final determination. For periods on and after April

first, two thousand fourteen, the commissioner shall provide a report on

a quarterly basis to the majority leader of the New York state senate

and to the speaker of the New York state assembly with regard to the

status of such applications and approved projects. Such reports shall be

submitted no later than sixty days after the close of the quarter, and

shall include the most current information submitted by applicants to

the state. The reports shall be submitted in conjunction with and as a

part of the reports submitted pursuant to paragraph (c) of subdivision

twenty of this section and shall include:

(i) analysis of progress made toward project goals;

(ii) the impact on the state's health care delivery system;

(iii) information on the number and types of providers who

participate;

(iv) plans and progress for monitoring provider compliance with

requirements;

(v) a status update on project milestone progress;

(vi) information on project spending and budget;

(vii) analysis of impact on Medicaid beneficiaries served;

(viii) a summary of public engagement and public comments received;

(ix) a description of applications that were denied;

(x) a description of all regulation waivers issued pursuant to

paragraph (e) of this subdivision; and

(xi) a summary of the statewide geographic distribution of funds.

(c) The commissioner shall make all reports prepared pursuant to

paragraph (b) of this subdivision and all supporting attachments and

materials available on the department's website.

(d) Notwithstanding any inconsistent law to the contrary, and subject

to federal financial participation, and subject to amounts appropriated

for purposes herein, the department may distribute funds to make rate

adjustments for health home providers as described in section three

hundred sixty-five-l of the social services law for member engagement,

staff training and retraining, health information technology

implementation, joint governance technical assistance, and other such

purposes as the commissioner, in consultation with the commissioners of

the office of mental health and the office of alcoholism and substance

abuse services determines.

(e) Notwithstanding any provisions of law to the contrary, the

commissioners of the department of health, the office of mental health,

the office for people with developmental disabilities, and the office of

alcoholism and substance abuse services are authorized to waive any

regulatory requirements as are necessary, consistent with applicable

law, to allow applicants under this subdivision and paragraph (a) of

subdivision two of section twenty-eight hundred twenty-five of this

article to avoid duplication of requirements and to allow the efficient

implementation of the proposed project; provided, however, that

regulations pertaining to patient safety may not be waived, not shall

any regulation be waived if such waiver would risk patient safety. Such

waiver shall not exceed the life of the project or such shorter time

period as the authorizing commissioner any determine. Any regulatory

relief granted pursuant to this subdivision shall be described,

including each regulation waived and the project it relates to, in the

report provided pursuant to paragraph (b) of this subdivision.