2011 Session

Budget Amendments - HB1500 (Conference Report)

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Implement Prospective Payment System-Outpatient Hospital Services (language only)

Item 297 #1c

Item 297 #1c

Health And Human Resources
Medical Assistance Services, Department of

Page 268, after line 55, insert:
"YYYY. Effective January 1, 2012, the Department of Medical Assistance Services shall have the authority to amend the State Plan for Medical Assistance to convert the current cost-based reimbursement methodology for outpatient hospitals to an Enhanced Ambulatory Patient Group (EAPG) methodology.  Reimbursement for laboratory services shall be included in the new outpatient hospital reimbursement methodology.  The new EAPG reimbursement methodology shall be implemented in a budget-neutral manner.  The department shall have the authority to implement this action effective January 1, 2012, and shall promulgate regulations to become effective within 280 days or less from the enactment of this act."

(This amendment authorizes the Department of Medical Assistance Services to adopt a new prospective payment system for outpatient hospital services, similar to the current system for inpatient services. The current cost-based reimbursement system is antiquated and inefficient, whereas a prospective payment system will provide better incentives for hospitals.)