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LEGISLATURE
OF
THE
STATE
OF
IDAHO
Sixty-eighth
Legislature
Second
Regular
Session
-
2026
IN
THE
SENATE
SENATE
BILL
NO.
1312
BY
HEALTH
AND
WELFARE
COMMITTEE
AN
ACT
1
RELATING
TO
PUBLIC
ASSISTANCE;
AMENDING
SECTION
56
-
265,
IDAHO
CODE,
TO
RE
-
2
VISE
PROVISIONS
REGARDING
PROVIDER
PAYMENT;
PROVIDING
THAT
CERTAIN
AD
-
3
MINISTRATIVE
RULES
CONTAINED
IN
IDAPA
16.03.26
SHALL
BE
NULL,
VOID,
AND
4
OF
NO
FORCE
AND
EFFECT;
AND
DECLARING
AN
EMERGENCY.
5
Be
It
Enacted
by
the
Legislature
of
the
State
of
Idaho:
6
SECTION
1.
That
Section
56
-
265,
Idaho
Code,
be,
and
the
same
is
hereby
7
amended
to
read
as
follows:
8
56
-
265.
PROVIDER
PAYMENT.
(1)
Where
there
is
an
equivalent,
the
pay
-
9
ment
to
medicaid
providers:
10
(a)
May
be
up
to
but
shall
not
exceed
one
hundred
percent
(100%)
of
the
1
1
current
medicare
rate
for
primary
care
procedure
codes
as
defined
by
the
12
centers
for
medicare
and
medicaid
services;
and
13
(b)
Shall
be
ninety
percent
(90%)
of
the
current
medicare
rate
for
all
14
other
procedure
codes.
15
(2)
Where
there
is
no
medicare
equivalent,
the
payment
rate
to
med
-
16
icaid
providers
shall
be
prescribed
by
rule.
All
home
and
community
-
based
17
services
without
a
medicare
equivalent
rate
shall
be
cost
-
surveyed
annu
-
18
ally
with
fifteen
percent
(15%)
or
more
of
responses
being
audited.
The
19
department
shall
use
information
from
the
cost
surveys
and
other
sources
20
to
evaluate
rate
adequacy.
Payment
rates
shall
be
developed
to
include
21
allocations
to
direct
care
worker
wages,
employee
-
related
expenses,
pro
-
22
gram
-
related
expenses,
and
general
and
administrative
costs.
23
(a)
On
an
annual
basis,
providers
are
required
to
expend
at
least
the
24
amount
allocated
to
direct
care
worker
wages
and
employee
-
related
ex
-
25
penses
to
these
categories.
26
(b)
Failure
of
the
provider
to
meet
the
requirement
in
paragraph
(a)
of
27
this
subsection
may
result
in
a
department
-
approved
corrective
action
28
plan,
closure
of
intake,
or
termination
of
the
provider
agreement.
29
(c)
The
department
shall
summarize
this
audited
cost
survey
work
by
30
provider
type
and
service
in
a
publicly
available
report
no
later
than
31
December
31
of
each
calendar
year.
32
(3)
Notwithstanding
any
other
provision
of
this
chapter,
if
the
33
services
are
provided
by
a
private,
freestanding
mental
health
hospital
34
facility
that
is
an
institution
for
mental
disease
as
defined
in
42
U.S.C.
35
1396d(i),
the
department
shall
reimburse
for
inpatient
services
at
a
rate
36
not
to
exceed
ninety
-
one
percent
(91%)
of
the
current
medicare
rate
within
37
federally
allowed
reimbursement
under
the
medicaid
program.
The
reimburse
-
38
ment
provided
for
in
this
subsection
shall
be
effective
until
July
1,
2021.
39
(4)
The
department
shall,
through
the
annual
budget
process,
include
40
a
line
-
item
request
for
adjustments
to
provider
rates.
All
changes
to
41
2
provider
payment
rates
shall
be
subject
to
approval
of
the
legislature
by
1
appropriation.
2
(5)
Notwithstanding
any
other
provision
of
this
chapter,
the
depart
-
3
ment
may
enter
into
agreements
with
providers
to
pay
for
services
based
on
4
their
value
in
terms
of
measurable
health
care
quality
and
positive
impacts
5
to
participant
health.
6
(a)
Any
such
agreement
shall
be
designed
to
be
cost
-
neutral
or
cost
-
7
saving
compared
to
other
payment
methodologies.
8
(b)
The
department
is
authorized
to
pursue
waiver
agreements
with
the
9
federal
government
as
needed
to
support
value
-
based
payment
arrange
-
10
ments,
up
to
and
including
fully
capitated
provider
-
based
managed
care.
1
1
(c)
Beginning
with
the
2024
performance
period
and
for
all
future
per
-
12
formance
periods
thereafter,
federally
qualified
health
centers
and
13
any
organization
owned
and
controlled
by
a
federally
qualified
health
14
center
shall
be
exempt
from
any
financial
risk
in
value
-
based
payment
15
agreements
created
pursuant
to
this
section.
16
(6)
Medicaid
reimbursement
for
critical
access,
out
-
of
-
state,
and
17
state
-
owned
hospitals
shall
be
as
follows:
18
(a)
In
-
state,
critical
access
hospitals
as
designated
according
to
42
19
U.S.C.
1395i
-
4(c)(2)(B)
shall
be
reimbursed
at
one
hundred
one
percent
20
(101%)
of
cost;
21
(b)
Out
-
of
-
state
hospitals
shall
be
reimbursed
at
eighty
-
seven
percent
22
(87%)
of
cost;
23
(c)
State
-
owned
hospitals
shall
be
reimbursed
at
one
hundred
percent
24
(100%)
of
cost;
and
25
(d)
Out
-
of
-
state
hospital
institutions
for
mental
disease
as
defined
26
in
42
U.S.C.
1396d(i)
shall
be
reimbursed
at
a
per
diem
equivalent
to
27
ninety
-
five
percent
(95%)
of
cost.
28
(7)
The
department
shall
equitably
reduce
net
reimbursements
for
all
29
hospital
services,
including
in
-
state
institutions
for
mental
disease
but
30
excluding
all
hospitals
and
institutions
described
in
subsection
(6)
of
31
this
section,
by
amounts
targeted
to
reduce
general
fund
needs
for
hospital
32
payments
by
three
million
one
hundred
thousand
dollars
($3,100,000)
in
state
33
fiscal
year
2020
and
eight
million
seven
hundred
twenty
thousand
dollars
34
($8,720,000)
in
state
fiscal
year
2021.
35
(8)
The
department
shall
work
with
all
Idaho
hospitals,
including
in
-
36
stitutions
for
mental
disease
as
defined
in
42
U.S.C.
1396d(i),
to
establish
37
value
-
based
payment
methods
for
inpatient
and
outpatient
hospital
services
38
to
replace
existing
cost
-
based
reimbursement
methods
for
in
-
state
hospi
-
39
tals,
other
than
those
hospitals
and
institutions
described
in
subsection
40
(6)
of
this
section,
effective
July
1,
2021.
Budgets
for
hospital
payments
41
shall
be
subject
to
prospective
legislative
approval.
42
(9)
The
department
shall
work
with
Idaho
hospitals
to
establish
a
43
quality
payment
program
for
inpatient
and
outpatient
adjustment
payments
44
described
in
section
56
-
1406,
Idaho
Code.
Inpatient
and
outpatient
adjust
-
45
ment
payments
shall
be
subject
to
increase
or
reduction
based
on
hospital
46
service
quality
measures
established
by
the
department
in
consultation
with
47
Idaho
hospitals.
48
SECTION
2.
The
rules
contained
in
IDAPA
16.03.26,
Department
of
Health
49
and
Welfare,
relating
to
Medicaid
Plan
Benefits,
Section
051.;
and
Section
50
3
052.,
shall
be
null,
void,
and
of
no
force
and
effect
on
and
after
July
1,
1
2026.
2
SECTION
3.
An
emergency
existing
therefor,
which
emergency
is
hereby
3
declared
to
exist,
this
act
shall
be
in
full
force
and
effect
on
and
after
its
4
passage
and
approval.
5