DHFS-TRANSFORMATION PROGRAM

Illinois General Assembly - Full Text of SB3528

Select Language

×

The Illinois General Assembly offers the Google Translate™ service for visitor convenience. In no way should it be considered accurate as to the translation of any content herein.

Visitors of the Illinois General Assembly website are encouraged to use other translation services available on the internet.

The English language version is always the official and authoritative version of this website.

NOTE: To return to the original English language version, select the "Show Original" button on the Google Translate™ menu bar at the top of the window.

Choose Language

English

Afrikaans

Albanian

Arabic

Armenian

Azerbaijani

Basque

Bengali

Bosnian

Catalan

Croatian

Czech

Danish

Dutch

Esperanto

Estonian

Filipino

Finnish

French

Galician

Georgian

German

Greek

Gujarati

Haitian Creole

Hausa

Hawaiian

Hebrew

Hindi

Hungarian

Icelandic

Indonesian

Interlingua

Interlingue

Inuktitut

Irish

Italian

Japanese

Javanese

Kannada

Khmer

Korean

Latin

Latvian

Lithuanian

Luxembourgish

Macedonian

Malagasy

Malayalam

Maltese

Maori

Marathi

Myanmar

Nepali

Norwegian

Odia

Pashto

Punjabi

Romanian

Russian

Samoan

Sango

Sanskrit

Sardinian

Sindhi

Sinhala

Slovak

Slovenian

Somali

Southern Sotho

Spanish

Sundanese

Swahili

Swedish

Tamil

Telugu

Thai

Tigrinya

Tonga

Turkish

Ukrainian

Urdu

Vietnamese

Welsh

Xhosa

Yiddish

Yoruba

Zulu

Powered by
Translate

Close

Illinois General Assembly

Top Navigation Bar

Translate

Learn

Select General Assembly

Search the 104th General Assembly

Enter search terms for legislation, members, committees, or schedules.

ILGA.GOV

LEGISLATION & LAWS

Bills & Resolutions

Public Acts

Illinois Compiled Statutes

Illinois Constitution

Search Legislation

Glossary

Guide

Reports & Inquiry

Legislative Reports

Special Reports

FTP Site

Legislator Lookup

Capitol Complex Phone Numbers

Rules & Regulations

Illinois Register

Administrative Rules

Senate

Members

Schedules

Committees

Request for Remote Testimony

Journals

Transcripts

Rules

Audio/Video

FOIA Information

Senate Employment Opportunities

Media Guidelines

House

Members

Schedules

Committees

Submit testimony for House Committees

Journals

Transcripts

Rules

Audio/Video

FOIA Information

House Employment Opportunities

Log In

Mobile Top Bar

Search the 104th General Assembly

Enter keywords to search the Illinois General Assembly website.

Full Text of SB3528

Home

Legislation

Full Text

SB3528 - 104th General Assembly

Bill Status

Full Text

Votes

Witness Slips

Select Menu

Bill Status

Full Text

Votes

Witness Slips

Printer Friendly Version

Introduced

Printer Friendly Version

Introduced

Open PDF

104TH GENERAL ASSEMBLY
State of Illinois
2025 and 2026
SB3528

Introduced 2/5/2026, by Sen. Adriane Johnson

SYNOPSIS AS INTRODUCED:

305 ILCS 5/14-12

Amends the Hospital Services Trust Fund Article in the Illinois
Public Aid Code. In provisions concerning annual funding for the health
care transformation program, provides that funds that had been budgeted
but unexpended in State fiscal years 2021 through 2027 may be allocated in
State fiscal year 2028 in an amount not to exceed $150,000,000.
LRB104 19026 KTG 32471 b

A BILL FOR

SB3528
LRB104 19026 KTG 32471 b
1

AN ACT concerning public aid.

2

Be it enacted by the People of the State of Illinois,
3
represented in the General Assembly:

4

Section 5.
The Illinois Public Aid Code is amended by
5
changing Section 14-12 as follows:

6

(305 ILCS 5/14-12)
7

Sec. 14-12.
Hospital rate reform payment system.
The
8
hospital payment system pursuant to Section 14-11 of this
9
Article shall be as follows:
10

(a) Inpatient hospital services. Effective on and after
11
the effective date of this amendatory Act of the 104th General
12
Assembly, reimbursement for inpatient general acute care
13
services shall utilize the All Patient Refined Diagnosis
14
Related Grouping (APR-DRG) software distributed by Solventum
TM

15
previously known as 3M
TM
Health Information System. Solventum
TM

16
shall be the exclusive provider of this software unless the
17
Department determines that Solventum
TM
is unable to meet the
18
required operational or contractual terms. Only under these
19
circumstances may an alternative authorized provider of the
20
software be considered.
21

(1) The Department shall establish Medicaid weighting
22

factors to be used in the reimbursement system established
23

under this subsection. Initial weighting factors shall be

SB3528
- 2 -
LRB104 19026 KTG 32471 b
1

the weighting factors as published by the authorized
2

provider of this software adjusted for the Illinois
3

experience.
4

(2) The Department shall establish a
5

statewide-standardized amount to be used in the inpatient
6

reimbursement system. The Department shall publish these
7

amounts on its website no later than 10 calendar days
8

prior to their effective date.
9

(3) In addition to the statewide-standardized amount,
10

the Department shall develop adjusters to adjust the rate
11

of reimbursement for critical Medicaid providers or
12

services for trauma, transplantation services, perinatal
13

care, and Graduate Medical Education (GME).
14

(4) The Department shall develop add-on payments to
15

account for exceptionally costly inpatient stays,
16

consistent with Medicare outlier principles. Outlier fixed
17

loss thresholds may be updated to control for excessive
18

growth in outlier payments no more frequently than on an
19

annual basis, but at least once every 4 years. Upon
20

updating the fixed loss thresholds, the Department shall
21

be required to update base rates within 12 months.
22

(5) The Department shall define those hospitals or
23

distinct parts of hospitals that shall be exempt from the
24

APR-DRG reimbursement system established under this
25

Section. The Department shall publish these hospitals'
26

inpatient rates on its website no later than 10 calendar

SB3528
- 3 -
LRB104 19026 KTG 32471 b
1

days prior to their effective date.
2

(6) Beginning July 1, 2014 and ending on December 31,
3

2023, in addition to the statewide-standardized amount,
4

the Department shall develop an adjustor to adjust the
5

rate of reimbursement for safety-net hospitals defined in
6

Section 5-5e.1 of this Code excluding pediatric hospitals.
7

(7) Beginning July 1, 2014, in addition to the
8

statewide-standardized amount, the Department shall
9

develop an adjustor to adjust the rate of reimbursement
10

for Illinois freestanding inpatient psychiatric hospitals
11

that are not designated as children's hospitals by the
12

Department but are primarily treating patients under the
13

age of 21.
14

(7.5) (Blank).
15

(8) Beginning July 1, 2018, in addition to the
16

statewide-standardized amount, the Department shall adjust
17

the rate of reimbursement for hospitals designated by the
18

Department of Public Health as a Perinatal Level II or II+
19

center by applying the same adjustor that is applied to
20

Perinatal and Obstetrical care cases for Perinatal Level
21

III centers, as of December 31, 2017.
22

(9) Beginning July 1, 2018, in addition to the
23

statewide-standardized amount, the Department shall apply
24

the same adjustor that is applied to trauma cases as of
25

December 31, 2017 to inpatient claims to treat patients
26

with burns, including, but not limited to, APR-DRGs 841,

SB3528
- 4 -
LRB104 19026 KTG 32471 b
1

842, 843, and 844.
2

(10) Beginning July 1, 2018, the
3

statewide-standardized amount for inpatient general acute
4

care services shall be uniformly increased so that base
5

claims projected reimbursement is increased by an amount
6

equal to the funds allocated in paragraph (1) of
7

subsection (b) of Section 5A-12.6, less the amount
8

allocated under paragraphs (8) and (9) of this subsection
9

and paragraphs (3) and (4) of subsection (b) multiplied by
10

40%.
11

(11) Beginning July 1, 2018, the reimbursement for
12

inpatient rehabilitation services shall be increased by
13

the addition of a $96 per day add-on.
14

(b) Outpatient hospital services. Effective on and after
15
the effective date of this amendatory Act of the 104th General
16
Assembly, reimbursement for outpatient services shall utilize
17
the Enhanced Ambulatory Procedure Grouping (EAPG) software
18
distributed by Solventum
TM
previously known as 3M
TM
Health
19
Information System. Solventum
TM
shall be the exclusive
20
provider of this software unless the Agency determines that
21
Solventum
TM
is unable to meet the required operational or
22
contractual terms. Only under these circumstances may an
23
alternative authorized provider of the software be considered.
24

(1) The Department shall establish Medicaid weighting
25

factors to be used in the reimbursement system established
26

under this subsection. The initial weighting factors shall

SB3528
- 5 -
LRB104 19026 KTG 32471 b
1

be the weighting factors as published by the authorized
2

provider.
3

(2) The Department shall establish service specific
4

statewide-standardized amounts to be used in the
5

reimbursement system.
6

(A) The initial statewide standardized amounts,
7

with the labor portion adjusted by the Calendar Year
8

2013 Medicare Outpatient Prospective Payment System
9

wage index with reclassifications, shall be published
10

by the Department on its website no later than 10
11

calendar days prior to their effective date.
12

(B) The Department shall establish adjustments to
13

the statewide-standardized amounts for each Critical
14

Access Hospital, as designated by the Department of
15

Public Health in accordance with 42 CFR 485, Subpart
16

F. For outpatient services provided on or before June
17

30, 2018, the EAPG standardized amounts are determined
18

separately for each critical access hospital such that
19

simulated EAPG payments using outpatient base period
20

paid claim data plus payments under Section 5A-12.4 of
21

this Code net of the associated tax costs are equal to
22

the estimated costs of outpatient base period claims
23

data with a rate year cost inflation factor applied.
24

(3) In addition to the statewide-standardized amounts,
25

the Department shall develop adjusters to adjust the rate
26

of reimbursement for critical Medicaid hospital outpatient

SB3528
- 6 -
LRB104 19026 KTG 32471 b
1

providers or services, including outpatient high volume or
2

safety-net hospitals. Beginning July 1, 2018, the
3

outpatient high volume adjustor shall be increased to
4

increase annual expenditures associated with this adjustor
5

by $79,200,000, based on the State Fiscal Year 2015 base
6

year data and this adjustor shall apply to public
7

hospitals, except for large public hospitals, as defined
8

under 89 Ill. Adm. Code 148.25(a).
9

(4) Beginning July 1, 2018, in addition to the
10

statewide standardized amounts, the Department shall make
11

an add-on payment for outpatient expensive devices and
12

drugs. This add-on payment shall at least apply to claim
13

lines that: (i) are assigned with one of the following
14

EAPGs: 490, 1001 to 1020, and coded with one of the
15

following revenue codes: 0274 to 0276, 0278; or (ii) are
16

assigned with one of the following EAPGs: 430 to 441, 443,
17

444, 460 to 465, 495, 496, 1090. The add-on payment shall
18

be calculated as follows: the claim line's covered charges
19

multiplied by the hospital's total acute cost to charge
20

ratio, less the claim line's EAPG payment plus $1,000,
21

multiplied by 0.8.
22

(5) Beginning July 1, 2018, the statewide-standardized
23

amounts for outpatient services shall be increased by a
24

uniform percentage so that base claims projected
25

reimbursement is increased by an amount equal to no less
26

than the funds allocated in paragraph (1) of subsection

SB3528
- 7 -
LRB104 19026 KTG 32471 b
1

(b) of Section 5A-12.6, less the amount allocated under
2

paragraphs (8) and (9) of subsection (a) and paragraphs
3

(3) and (4) of this subsection multiplied by 46%.
4

(6) Effective for dates of service on or after July 1,
5

2018, the Department shall establish adjustments to the
6

statewide-standardized amounts for each Critical Access
7

Hospital, as designated by the Department of Public Health
8

in accordance with 42 CFR 485, Subpart F, such that each
9

Critical Access Hospital's standardized amount for
10

outpatient services shall be increased by the applicable
11

uniform percentage determined pursuant to paragraph (5) of
12

this subsection. It is the intent of the General Assembly
13

that the adjustments required under this paragraph (6) by
14

Public Act 100-1181 shall be applied retroactively to
15

claims for dates of service provided on or after July 1,
16

2018.
17

(7) Effective for dates of service on or after March
18

8, 2019 (the effective date of Public Act 100-1181), the
19

Department shall recalculate and implement an updated
20

statewide-standardized amount for outpatient services
21

provided by hospitals that are not Critical Access
22

Hospitals to reflect the applicable uniform percentage
23

determined pursuant to paragraph (5).
24

(1) Any recalculation to the
25

statewide-standardized amounts for outpatient services
26

provided by hospitals that are not Critical Access

SB3528
- 8 -
LRB104 19026 KTG 32471 b
1

Hospitals shall be the amount necessary to achieve the
2

increase in the statewide-standardized amounts for
3

outpatient services increased by a uniform percentage,
4

so that base claims projected reimbursement is
5

increased by an amount equal to no less than the funds
6

allocated in paragraph (1) of subsection (b) of
7

Section 5A-12.6, less the amount allocated under
8

paragraphs (8) and (9) of subsection (a) and
9

paragraphs (3) and (4) of this subsection, for all
10

hospitals that are not Critical Access Hospitals,
11

multiplied by 46%.
12

(2) It is the intent of the General Assembly that
13

the recalculations required under this paragraph (7)
14

by Public Act 100-1181 shall be applied prospectively
15

to claims for dates of service provided on or after
16

March 8, 2019 (the effective date of Public Act
17

100-1181) and that no recoupment or repayment by the
18

Department or an MCO of payments attributable to
19

recalculation under this paragraph (7), issued to the
20

hospital for dates of service on or after July 1, 2018
21

and before March 8, 2019 (the effective date of Public
22

Act 100-1181), shall be permitted.
23

(8) The Department shall ensure that all necessary
24

adjustments to the managed care organization capitation
25

base rates necessitated by the adjustments under
26

subparagraph (6) or (7) of this subsection are completed

SB3528
- 9 -
LRB104 19026 KTG 32471 b
1

and applied retroactively in accordance with Section
2

5-30.8 of this Code within 90 days of March 8, 2019 (the
3

effective date of Public Act 100-1181).
4

(9) Within 60 days after federal approval of the
5

change made to the assessment in Section 5A-2 by Public
6

Act 101-650, the Department shall incorporate into the
7

EAPG system for outpatient services those services
8

performed by hospitals currently billed through the
9

Non-Institutional Provider billing system.
10

(b-5) Notwithstanding any other provision of this Section,
11
beginning with dates of service on and after January 1, 2023,
12
any general acute care hospital with more than 500 outpatient
13
psychiatric Medicaid services to persons under 19 years of age
14
in any calendar year shall be paid the outpatient add-on
15
payment of no less than $113.
16

(c) In consultation with the hospital community, the
17
Department is authorized to replace 89 Ill. Adm. Code 152.150
18
as published in 38 Ill. Reg. 4980 through 4986 within 12 months
19
of June 16, 2014 (the effective date of Public Act 98-651). If
20
the Department does not replace these rules within 12 months
21
of June 16, 2014 (the effective date of Public Act 98-651), the
22
rules in effect for 152.150 as published in 38 Ill. Reg. 4980
23
through 4986 shall remain in effect until modified by rule by
24
the Department. Nothing in this subsection shall be construed
25
to mandate that the Department file a replacement rule.
26

(d) Transition period. There shall be a transition period

SB3528
- 10 -
LRB104 19026 KTG 32471 b
1
to the reimbursement systems authorized under this Section
2
that shall begin on the effective date of these systems and
3
continue until June 30, 2018, unless extended by rule by the
4
Department. To help provide an orderly and predictable
5
transition to the new reimbursement systems and to preserve
6
and enhance access to the hospital services during this
7
transition, the Department shall allocate a transitional
8
hospital access pool of at least $290,000,000 annually so that
9
transitional hospital access payments are made to hospitals.
10

(1) After the transition period, the Department may
11

begin incorporating the transitional hospital access pool
12

into the base rate structure; however, the transitional
13

hospital access payments in effect on June 30, 2018 shall
14

continue to be paid, if continued under Section 5A-16.
15

(2) After the transition period, if the Department
16

reduces payments from the transitional hospital access
17

pool, it shall increase base rates, develop new adjustors,
18

adjust current adjustors, develop new hospital access
19

payments based on updated information, or any combination
20

thereof by an amount equal to the decreases proposed in
21

the transitional hospital access pool payments, ensuring
22

that the entire transitional hospital access pool amount
23

shall continue to be used for hospital payments.
24

(d-5) Hospital and health care transformation program. The
25
Department shall develop a hospital and health care
26
transformation program to provide financial assistance to

SB3528
- 11 -
LRB104 19026 KTG 32471 b
1
hospitals in transforming their services and care models to
2
better align with the needs of the communities they serve. The
3
payments authorized in this Section shall be subject to
4
approval by the federal government.
5

(1) Phase 1. In State fiscal years 2019 through 2020,
6

the Department shall allocate funds from the transitional
7

access hospital pool to create a hospital transformation
8

pool of at least $262,906,870 annually and make hospital
9

transformation payments to hospitals. Subject to Section
10

5A-16, in State fiscal years 2019 and 2020, an Illinois
11

hospital that received either a transitional hospital
12

access payment under subsection (d) or a supplemental
13

payment under subsection (f) of this Section in State
14

fiscal year 2018, shall receive a hospital transformation
15

payment as follows:
16

(A) If the hospital's Rate Year 2017 Medicaid
17

inpatient utilization rate is equal to or greater than
18

45%, the hospital transformation payment shall be
19

equal to 100% of the sum of its transitional hospital
20

access payment authorized under subsection (d) and any
21

supplemental payment authorized under subsection (f).
22

(B) If the hospital's Rate Year 2017 Medicaid
23

inpatient utilization rate is equal to or greater than
24

25% but less than 45%, the hospital transformation
25

payment shall be equal to 75% of the sum of its
26

transitional hospital access payment authorized under

SB3528
- 12 -
LRB104 19026 KTG 32471 b
1

subsection (d) and any supplemental payment authorized
2

under subsection (f).
3

(C) If the hospital's Rate Year 2017 Medicaid
4

inpatient utilization rate is less than 25%, the
5

hospital transformation payment shall be equal to 50%
6

of the sum of its transitional hospital access payment
7

authorized under subsection (d) and any supplemental
8

payment authorized under subsection (f).
9

(2) Phase 2.
10

(A) The funding amount from phase one shall be
11

incorporated into directed payment and pass-through
12

payment methodologies described in Section 5A-12.7.
13

(B) Because there are communities in Illinois that
14

experience significant health care disparities due to
15

systemic racism, as recently emphasized by the
16

COVID-19 pandemic, aggravated by social determinants
17

of health and a lack of sufficiently allocated health
18

care resources, particularly community-based services,
19

preventive care, obstetric care, chronic disease
20

management, and specialty care, the Department shall
21

establish a health care transformation program that
22

shall be supported by the transformation funding pool.
23

It is the intention of the General Assembly that
24

innovative partnerships funded by the pool must be
25

designed to establish or improve integrated health
26

care delivery systems that will provide significant

SB3528
- 13 -
LRB104 19026 KTG 32471 b
1

access to the Medicaid and uninsured populations in
2

their communities, as well as improve health care
3

equity. It is also the intention of the General
4

Assembly that partnerships recognize and address the
5

disparities revealed by the COVID-19 pandemic, as well
6

as the need for post-COVID care. During State fiscal
7

years 2021 through 2027, the hospital and health care
8

transformation program shall be supported by an annual
9

transformation funding pool of up to $150,000,000,
10

pending federal matching funds, to be allocated during
11

the specified fiscal years for the purpose of
12

facilitating hospital and health care transformation.
13

Funds that had been budgeted but unexpended in State
14

fiscal years 2021 through 2027 may be allocated in
15

State fiscal year 2028 in an amount not to exceed
16

$150,000,000.
No disbursement of moneys for
17

transformation projects from the transformation
18

funding pool described under this Section shall be
19

considered an award, a grant, or an expenditure of
20

grant funds. Funding agreements made in accordance
21

with the transformation program shall be considered
22

purchases of care under the Illinois Procurement Code,
23

and funds shall be expended by the Department in a
24

manner that maximizes federal funding to expend the
25

entire allocated amount.
26

The Department shall convene, within 30 days after

SB3528
- 14 -
LRB104 19026 KTG 32471 b
1

March 12, 2021 (the effective date of Public Act
2

101-655), a workgroup that includes subject matter
3

experts on health care disparities and stakeholders
4

from distressed communities, which could be a
5

subcommittee of the Medicaid Advisory Committee, to
6

review and provide recommendations on how Department
7

policy, including health care transformation, can
8

improve health disparities and the impact on
9

communities disproportionately affected by COVID-19.
10

The workgroup shall consider and make recommendations
11

on the following issues: a community safety-net
12

designation of certain hospitals, racial equity, and a
13

regional partnership to bring additional specialty
14

services to communities.
15

(C) As provided in paragraph (9) of Section 3 of
16

the Illinois Health Facilities Planning Act, any
17

hospital participating in the transformation program
18

may be excluded from the requirements of the Illinois
19

Health Facilities Planning Act for those projects
20

related to the hospital's transformation. To be
21

eligible, the hospital must submit to the Health
22

Facilities and Services Review Board approval from the
23

Department that the project is a part of the
24

hospital's transformation.
25

(D) As provided in subsection (a-20) of Section
26

32.5 of the Emergency Medical Services (EMS) Systems

SB3528
- 15 -
LRB104 19026 KTG 32471 b
1

Act, a hospital that received hospital transformation
2

payments under this Section may convert to a
3

freestanding emergency center. To be eligible for such
4

a conversion, the hospital must submit to the
5

Department of Public Health approval from the
6

Department that the project is a part of the
7

hospital's transformation.
8

(E) Criteria for proposals. To be eligible for
9

funding under this Section, a transformation proposal
10

shall meet all of the following criteria:
11

(i) the proposal shall be designed based on
12

community needs assessment completed by either a
13

University partner or other qualified entity with
14

significant community input;
15

(ii) the proposal shall be a collaboration
16

among providers across the care and community
17

spectrum, including preventative care, primary
18

care specialty care, hospital services, mental
19

health and substance abuse services, as well as
20

community-based entities that address the social
21

determinants of health;
22

(iii) the proposal shall be specifically
23

designed to improve health care outcomes and
24

reduce health care disparities, and improve the
25

coordination, effectiveness, and efficiency of
26

care delivery;

SB3528
- 16 -
LRB104 19026 KTG 32471 b
1

(iv) the proposal shall have specific
2

measurable metrics related to disparities that
3

will be tracked by the Department and made public
4

by the Department;
5

(v) the proposal shall include a commitment to
6

include Business Enterprise Program certified
7

vendors or other entities controlled and managed
8

by minorities or women; and
9

(vi) the proposal shall specifically increase
10

access to primary, preventive, or specialty care.
11

(F) Entities eligible to be funded.
12

(i) Proposals for funding should come from
13

collaborations operating in one of the most
14

distressed communities in Illinois as determined
15

by the U.S. Centers for Disease Control and
16

Prevention's Social Vulnerability Index for
17

Illinois and areas disproportionately impacted by
18

COVID-19 or from rural areas of Illinois.
19

(ii) The Department shall prioritize
20

partnerships from distressed communities, which
21

include Business Enterprise Program certified
22

vendors or other entities controlled and managed
23

by minorities or women and also include one or
24

more of the following: safety-net hospitals,
25

critical access hospitals, the campuses of
26

hospitals that have closed since January 1, 2018,

SB3528
- 17 -
LRB104 19026 KTG 32471 b
1

or other health care providers designed to address
2

specific health care disparities, including the
3

impact of COVID-19 on individuals and the
4

community and the need for post-COVID care. All
5

funded proposals must include specific measurable
6

goals and metrics related to improved outcomes and
7

reduced disparities which shall be tracked by the
8

Department.
9

(iii) The Department should target the funding
10

in the following ways: $30,000,000 of
11

transformation funds to projects that are a
12

collaboration between a safety-net hospital,
13

particularly community safety-net hospitals, and
14

other providers and designed to address specific
15

health care disparities, $20,000,000 of
16

transformation funds to collaborations between
17

safety-net hospitals and a larger hospital partner
18

that increases specialty care in distressed
19

communities, $30,000,000 of transformation funds
20

to projects that are a collaboration between
21

hospitals and other providers in distressed areas
22

of the State designed to address specific health
23

care disparities, $15,000,000 to collaborations
24

between critical access hospitals and other
25

providers designed to address specific health care
26

disparities, and $15,000,000 to cross-provider

SB3528
- 18 -
LRB104 19026 KTG 32471 b
1

collaborations designed to address specific health
2

care disparities, and $5,000,000 to collaborations
3

that focus on workforce development.
4

(iv) The Department may allocate up to
5

$5,000,000 for planning, racial equity analysis,
6

or consulting resources for the Department or
7

entities without the resources to develop a plan
8

to meet the criteria of this Section. Any contract
9

for consulting services issued by the Department
10

under this subparagraph shall comply with the
11

provisions of Section 5-45 of the State Officials
12

and Employees Ethics Act. Based on availability of
13

federal funding, the Department may directly
14

procure consulting services or provide funding to
15

the collaboration. The provision of resources
16

under this subparagraph is not a guarantee that a
17

project will be approved.
18

(v) The Department shall take steps to ensure
19

that safety-net hospitals operating in
20

under-resourced communities receive priority
21

access to hospital and health care transformation
22

funds, including consulting funds, as provided
23

under this Section.
24

(G) Process for submitting and approving projects
25

for distressed communities. The Department shall issue
26

a template for application. The Department shall post

SB3528
- 19 -
LRB104 19026 KTG 32471 b
1

any proposal received on the Department's website for
2

at least 2 weeks for public comment, and any such
3

public comment shall also be considered in the review
4

process. Applicants may request that proprietary
5

financial information be redacted from publicly posted
6

proposals and the Department in its discretion may
7

agree. Proposals for each distressed community must
8

include all of the following:
9

(i) A detailed description of how the project
10

intends to affect the goals outlined in this
11

subsection, describing new interventions, new
12

technology, new structures, and other changes to
13

the health care delivery system planned.
14

(ii) A detailed description of the racial and
15

ethnic makeup of the entities' board and
16

leadership positions and the salaries of the
17

executive staff of entities in the partnership
18

that is seeking to obtain funding under this
19

Section.
20

(iii) A complete budget, including an overall
21

timeline and a detailed pathway to sustainability
22

within a 5-year period, specifying other sources
23

of funding, such as in-kind, cost-sharing, or
24

private donations, particularly for capital needs.
25

There is an expectation that parties to the
26

transformation project dedicate resources to the

SB3528
- 20 -
LRB104 19026 KTG 32471 b
1

extent they are able and that these expectations
2

are delineated separately for each entity in the
3

proposal.
4

(iv) A description of any new entities formed
5

or other legal relationships between collaborating
6

entities and how funds will be allocated among
7

participants.
8

(v) A timeline showing the evolution of sites
9

and specific services of the project over a 5-year
10

period, including services available to the
11

community by site.
12

(vi) Clear milestones indicating progress
13

toward the proposed goals of the proposal as
14

checkpoints along the way to continue receiving
15

funding. The Department is authorized to refine
16

these milestones in agreements, and is authorized
17

to impose reasonable penalties, including
18

repayment of funds, for substantial lack of
19

progress.
20

(vii) A clear statement of the level of
21

commitment the project will include for minorities
22

and women in contracting opportunities, including
23

as equity partners where applicable, or as
24

subcontractors and suppliers in all phases of the
25

project.
26

(viii) If the community study utilized is not

SB3528
- 21 -
LRB104 19026 KTG 32471 b
1

the study commissioned and published by the
2

Department, the applicant must define the
3

methodology used, including documentation of clear
4

community participation.
5

(ix) A description of the process used in
6

collaborating with all levels of government in the
7

community served in the development of the
8

project, including, but not limited to,
9

legislators and officials of other units of local
10

government.
11

(x) Documentation of a community input process
12

in the community served, including links to
13

proposal materials on public websites.
14

(xi) Verifiable project milestones and quality
15

metrics that will be impacted by transformation.
16

These project milestones and quality metrics must
17

be identified with improvement targets that must
18

be met.
19

(xii) Data on the number of existing employees
20

by various job categories and wage levels by the
21

zip code of the employees' residence and
22

benchmarks for the continued maintenance and
23

improvement of these levels. The proposal must
24

also describe any retraining or other workforce
25

development planned for the new project.
26

(xiii) If a new entity is created by the

SB3528
- 22 -
LRB104 19026 KTG 32471 b
1

project, a description of how the board will be
2

reflective of the community served by the
3

proposal.
4

(xiv) An explanation of how the proposal will
5

address the existing disparities that exacerbated
6

the impact of COVID-19 and the need for post-COVID
7

care in the community, if applicable.
8

(xv) An explanation of how the proposal is
9

designed to increase access to care, including
10

specialty care based upon the community's needs.
11

(H) The Department shall evaluate proposals for
12

compliance with the criteria listed under subparagraph
13

(G). Proposals meeting all of the criteria may be
14

eligible for funding with the areas of focus
15

prioritized as described in item (ii) of subparagraph
16

(F). Based on the funds available, the Department may
17

negotiate funding agreements with approved applicants
18

to maximize federal funding. Nothing in this
19

subsection requires that an approved project be funded
20

to the level requested. Agreements shall specify the
21

amount of funding anticipated annually, the
22

methodology of payments, the limit on the number of
23

years such funding may be provided, and the milestones
24

and quality metrics that must be met by the projects in
25

order to continue to receive funding during each year
26

of the program. Agreements shall specify the terms and

SB3528
- 23 -
LRB104 19026 KTG 32471 b
1

conditions under which a health care facility that
2

receives funds under a purchase of care agreement and
3

closes in violation of the terms of the agreement must
4

pay an early closure fee no greater than 50% of the
5

funds it received under the agreement, prior to the
6

Health Facilities and Services Review Board
7

considering an application for closure of the
8

facility. Any project that is funded shall be required
9

to provide quarterly written progress reports, in a
10

form prescribed by the Department, and at a minimum
11

shall include the progress made in achieving any
12

milestones or metrics or Business Enterprise Program
13

commitments in its plan. The Department may reduce or
14

end payments, as set forth in transformation plans, if
15

milestones or metrics or Business Enterprise Program
16

commitments are not achieved. The Department shall
17

seek to make payments from the transformation fund in
18

a manner that is eligible for federal matching funds.
19

In reviewing the proposals, the Department shall
20

take into account the needs of the community, data
21

from the study commissioned by the Department from the
22

University of Illinois-Chicago if applicable, feedback
23

from public comment on the Department's website, as
24

well as how the proposal meets the criteria listed
25

under subparagraph (G). Alignment with the
26

Department's overall strategic initiatives shall be an

SB3528
- 24 -
LRB104 19026 KTG 32471 b
1

important factor. To the extent that fiscal year
2

funding is not adequate to fund all eligible projects
3

that apply, the Department shall prioritize
4

applications that most comprehensively and effectively
5

address the criteria listed under subparagraph (G).
6

(3) (Blank).
7

(4) Hospital Transformation Review Committee. There is
8

created the Hospital Transformation Review Committee. The
9

Committee shall consist of 14 members. No later than 30
10

days after March 12, 2018 (the effective date of Public
11

Act 100-581), the 4 legislative leaders shall each appoint
12

3 members; the Governor shall appoint the Director of
13

Healthcare and Family Services, or his or her designee, as
14

a member; and the Director of Healthcare and Family
15

Services shall appoint one member. Any vacancy shall be
16

filled by the applicable appointing authority within 15
17

calendar days. The members of the Committee shall select a
18

Chair and a Vice-Chair from among its members, provided
19

that the Chair and Vice-Chair cannot be appointed by the
20

same appointing authority and must be from different
21

political parties. The Chair shall have the authority to
22

establish a meeting schedule and convene meetings of the
23

Committee, and the Vice-Chair shall have the authority to
24

convene meetings in the absence of the Chair. The
25

Committee may establish its own rules with respect to
26

meeting schedule, notice of meetings, and the disclosure

SB3528
- 25 -
LRB104 19026 KTG 32471 b
1

of documents; however, the Committee shall not have the
2

power to subpoena individuals or documents and any rules
3

must be approved by 9 of the 14 members. The Committee
4

shall perform the functions described in this Section and
5

advise and consult with the Director in the administration
6

of this Section. In addition to reviewing and approving
7

the policies, procedures, and rules for the hospital and
8

health care transformation program, the Committee shall
9

consider and make recommendations related to qualifying
10

criteria and payment methodologies related to safety-net
11

hospitals and children's hospitals. Members of the
12

Committee appointed by the legislative leaders shall be
13

subject to the jurisdiction of the Legislative Ethics
14

Commission, not the Executive Ethics Commission, and all
15

requests under the Freedom of Information Act shall be
16

directed to the applicable Freedom of Information officer
17

for the General Assembly. The Department shall provide
18

operational support to the Committee as necessary. The
19

Committee is dissolved on April 1, 2019.
20

(e) Beginning 36 months after initial implementation, the
21
Department shall update the reimbursement components in
22
subsections (a) and (b), including standardized amounts and
23
weighting factors, and at least once every 4 years and no more
24
frequently than annually thereafter. The Department shall
25
publish these updates on its website no later than 30 calendar
26
days prior to their effective date.

SB3528
- 26 -
LRB104 19026 KTG 32471 b
1

(f) Continuation of supplemental payments. Any
2
supplemental payments authorized under 89 Illinois
3
Administrative Code 148 effective January 1, 2014 and that
4
continue during the period of July 1, 2014 through December
5
31, 2014 shall remain in effect as long as the assessment
6
imposed by Section 5A-2 that is in effect on December 31, 2017
7
remains in effect.
8

(g) Notwithstanding subsections (a) through (f) of this
9
Section and notwithstanding the changes authorized under
10
Section 5-5b.1, any updates to the system shall not result in
11
any diminishment of the overall effective rates of
12
reimbursement as of the implementation date of the new system
13
(July 1, 2014). These updates shall not preclude variations in
14
any individual component of the system or hospital rate
15
variations. Nothing in this Section shall prohibit the
16
Department from increasing the rates of reimbursement or
17
developing payments to ensure access to hospital services.
18
Nothing in this Section shall be construed to guarantee a
19
minimum amount of spending in the aggregate or per hospital as
20
spending may be impacted by factors, including, but not
21
limited to, the number of individuals in the medical
22
assistance program and the severity of illness of the
23
individuals.
24

(h) The Department shall have the authority to modify by
25
rulemaking any changes to the rates or methodologies in this
26
Section as required by the federal government to obtain

SB3528
- 27 -
LRB104 19026 KTG 32471 b
1
federal financial participation for expenditures made under
2
this Section.
3

(i) Except for subsections (g) and (h) of this Section,
4
the Department shall, pursuant to subsection (c) of Section
5
5-40 of the Illinois Administrative Procedure Act, provide for
6
presentation at the June 2014 hearing of the Joint Committee
7
on Administrative Rules (JCAR) additional written notice to
8
JCAR of the following rules in order to commence the second
9
notice period for the following rules: rules published in the
10
Illinois Register, rule dated February 21, 2014 at 38 Ill.
11
Reg. 4559 (Medical Payment), 4628 (Specialized Health Care
12
Delivery Systems), 4640 (Hospital Services), 4932 (Diagnostic
13
Related Grouping (DRG) Prospective Payment System (PPS)), and
14
4977 (Hospital Reimbursement Changes), and published in the
15
Illinois Register dated March 21, 2014 at 38 Ill. Reg. 6499
16
(Specialized Health Care Delivery Systems) and 6505 (Hospital
17
Services).
18

(j) Out-of-state hospitals. Beginning July 1, 2018, for
19
purposes of determining for State fiscal years 2019 and 2020
20
and subsequent fiscal years the hospitals eligible for the
21
payments authorized under subsections (a) and (b) of this
22
Section, the Department shall include out-of-state hospitals
23
that are designated a Level I pediatric trauma center or a
24
Level I trauma center by the Department of Public Health as of
25
December 1, 2017.
26

(k) The Department shall notify each hospital and managed

SB3528
- 28 -
LRB104 19026 KTG 32471 b
1
care organization, in writing, of the impact of the updates
2
under this Section at least 30 calendar days prior to their
3
effective date.
4

(l) This Section is subject to Section 14-12.5.
5
(Source: P.A. 103-102, eff. 6-16-23; 103-154, eff. 6-30-23;
6
104-9, eff. 6-16-25; 104-417, eff. 8-15-25.)

Footer

Disclaimer

This site is maintained for the Illinois General Assembly by the
Legislative Information System, 705 Stratton Building, Springfield, Illinois 62706.

Contact ILGA Webmaster

ILGA.gov uses cookies to ensure you get the best experience on our website. By continuing to browse ILGA.gov you consent to our use of cookies.
Read About Cookies

ILGA.GOV

2026 ILGA.gov | All Rights Reserved |
ADA

|
Disclaimers
|
Learn

This site is maintained for the Illinois General Assembly by the
Legislative Information System, 705 Stratton Building, Springfield, Illinois 62706.
Contact ILGA Webmaster

ILGA.gov uses cookies to ensure you get the best experience on our website. By continuing to browse ILGA.gov you consent to our use of cookies.
Read About Cookies

ILGA.GOV

2026 ILGA.gov | All Rights Reserved |
ADA

|
Disclaimers
|
Learn