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104TH GENERAL ASSEMBLY
State of Illinois
2025 and 2026
SB3754

Introduced 2/5/2026, by Sen. Graciela Guzmán

SYNOPSIS AS INTRODUCED:

305 ILCS 5/14-12.5

Amends the Hospital Services Trust Fund Article of the Illinois
Public Aid Code. In provisions requiring the Department of Healthcare and
Family Services to (i) pay safety-net hospitals a health care equity
add-on payment that is based on such hospitals' Medicaid inpatient
utilization rate and (ii) pay safety-net hospitals a low volume add-on
payment of $200 for each inpatient General Acute and Psychiatric day of
care, removes the December 31, 2026 sunset dates for such add-on payments.
Effective immediately.
LRB104 18306 KTG 31746 b

A BILL FOR

SB3754
LRB104 18306 KTG 31746 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 14-12.5 as follows:

6

(305 ILCS 5/14-12.5)
7

Sec. 14-12.5.
Hospital rate updates.

8

(a) Notwithstanding any other provision of this Code, the
9
hospital rates of reimbursement authorized under Sections
10
5-5.05, 14-12, and 14-13 of this Code shall be adjusted in
11
accordance with the provisions of this Section.
12

(b) Notwithstanding any other provision of this Code,
13
effective for dates of service on and after January 1, 2024,
14
subject to federal approval, hospital reimbursement rates
15
shall be revised as follows:
16

(1) For inpatient general acute care services, the
17

statewide-standardized amount and the per diem rates for
18

hospitals exempt from the APR-DRG reimbursement system, in
19

effect January 1, 2023, shall be increased by 10%.
20

(2) For inpatient psychiatric services:
21

(A) For safety-net hospitals, the hospital
22

specific per diem rate in effect January 1, 2023 and
23

the minimum per diem rate of $630, authorized in

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LRB104 18306 KTG 31746 b
1

subsection (b-5) of Section 5-5.05 of this Code, shall
2

be increased by 10%.
3

(B) For all general acute care hospitals that are
4

not safety-net hospitals, the inpatient psychiatric
5

care per diem rates in effect January 1, 2023 shall be
6

increased by 10%, except that all rates shall be at
7

least 90% of the minimum inpatient psychiatric care
8

per diem rate for safety-net hospitals as authorized
9

in subsection (b-5) of Section 5-5.05 of this Code
10

including the adjustments authorized in this Section.
11

The statewide default per diem rate for a hospital
12

opening a new psychiatric distinct part unit, shall be
13

set at 90% of the minimum inpatient psychiatric care
14

per diem rate for safety-net hospitals as authorized
15

in subsection (b-5) of Section 5-5.05 of this Code,
16

including the adjustment authorized in this Section.
17

(C) For all psychiatric specialty hospitals, the
18

per diem rates in effect January 1, 2023, shall be
19

increased by 10%, except that all rates shall be at
20

least 90% of the minimum inpatient per diem rate for
21

safety-net hospitals as authorized in subsection (b-5)
22

of Section 5-5.05 of this Code, including the
23

adjustments authorized in this Section. The statewide
24

default per diem rate for a new psychiatric specialty
25

hospital shall be set at 90% of the minimum inpatient
26

psychiatric care per diem rate for safety-net

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LRB104 18306 KTG 31746 b
1

hospitals as authorized in subsection (b-5) of Section
2

5-5.05 of this Code, including the adjustment
3

authorized in this Section.
4

(3) For inpatient rehabilitative services, all
5

hospital specific per diem rates in effect January 1,
6

2023, shall be increased by 10%. The statewide default
7

inpatient rehabilitative services per diem rates, for
8

general acute care hospitals and for rehabilitation
9

specialty hospitals respectively, shall be increased by
10

10%.
11

(4) The statewide-standardized amount for outpatient
12

general acute care services in effect January 1, 2023,
13

shall be increased by 10%.
14

(5) The statewide-standardized amount for outpatient
15

psychiatric care services in effect January 1, 2023, shall
16

be increased by 10%.
17

(6) The statewide-standardized amount for outpatient
18

rehabilitative care services in effect January 1, 2023,
19

shall be increased by 10%.
20

(7) The per diem rate in effect January 1, 2023, as
21

authorized in subsection (a) of Section 14-13 of this
22

Article shall be increased by 10%.
23

(8) For services provided on and after January 1, 2024
24

through June 30, 2024, and on and after January 1, 2027,
25

subject to federal approval, in addition to the statewide
26

standardized amount, an add-on payment of at least $210

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LRB104 18306 KTG 31746 b
1

shall be paid for each inpatient General Acute and
2

Psychiatric day of care, excluding Medicare-Medicaid dual
3

eligible crossover days, for all safety-net hospitals
4

defined in Section 5-5e.1 of this Code.
5

(A) For Psychiatric days of care, the Department
6

may implement payment of this add-on by increasing the
7

hospital specific psychiatric per diem rate, adjusted
8

in accordance with subparagraph (A) of paragraph (2)
9

of subsection (b) by $210, or by a separate add-on
10

payment.
11

(B) If the add-on adjustment is added to the
12

hospital specific psychiatric per diem rate to
13

operationalize payment, the Department shall provide a
14

rate sheet to each safety-net hospital, which
15

identifies the hospital psychiatric per diem rate
16

before and after the adjustment.
17

(C) The add-on adjustment shall not be considered
18

when setting the 90% minimum rate identified in
19

paragraph (2) of subsection (b).
20

(9) For services provided on and after July 1, 2024,
21

and on or before December 31, 2026,
subject to federal
22

approval, in addition to the statewide standardized amount
23

and any other payments authorized under this Code, a
24

safety-net hospital health care equity add-on payment
25

shall be paid for each inpatient General Acute and
26

Psychiatric day of care, excluding Medicare-Medicaid dual

SB3754
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LRB104 18306 KTG 31746 b
1

eligible crossover days, for safety-net hospitals defined
2

in Section 5-5e.1 of this Code, as follows:
3

(A) if the safety-net hospital's Medicaid
4

inpatient utilization rate, as calculated under
5

Section 5-5e.1 of this Code, is equal to or greater
6

than 70%, the add-on payment shall be $425;
7

(B) if the safety-net hospital's Medicaid
8

inpatient utilization rate, as calculated under
9

Section 5-5e.1 of this Code, is equal to or greater
10

than 50% and less than 70%, the add-on payment shall be
11

$300;
12

(C) if the safety-net hospital's Medicaid
13

inpatient utilization rate, as calculated under
14

Section 5-5e.1 of this Code, is equal to or greater
15

than 40% and less than 50%, the add-on payment shall be
16

$225; and
17

(D) if the safety-net hospital's Medicaid
18

inpatient utilization rate, as calculated under
19

Section 5-5e.1 of this Code, is less than 40%, the
20

add-on payment shall be $210.
21

Qualification for the safety-net hospital health care
22

equity add-on payment shall be updated January 1, 2026,
23

based on the MIUR determination effective 3 months prior
24

to the start of the January 1, 2026 calendar year.
25

Rates described in subparagraphs (A) through (C) shall
26

be adjusted annually beginning January 1, 2026 by applying

SB3754
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LRB104 18306 KTG 31746 b
1

a uniform factor to each rate to spend an approximate
2

amount of $50,000,000 annually per year using State fiscal
3

year 2024 days as a basis for calendar year 2026 rates.
4

The add-on adjustment under this paragraph shall not
5

be considered when setting the 90% minimum rate identified
6

in subparagraph (B) of paragraph (2).
7

(10) For services provided on and after July 1, 2024,
8

and on or before December 31, 2026,
subject to federal
9

approval, in addition to the statewide standardized amount
10

and any other payments authorized under this Code, a
11

safety-net hospital low volume add-on payment of $200
12

shall be paid for each inpatient General Acute and
13

Psychiatric day of care, excluding Medicare-Medicaid dual
14

eligible crossover days, for any safety-net hospital as
15

defined in Section 5-5e.1 that provided less than 11,000
16

Medicaid inpatient days of care, excluding
17

Medicare-Medicaid dual eligible crossover days, in the
18

base period. As used in this paragraph, "base period"
19

means State fiscal year 2022 admissions received by the
20

Department prior to October 1, 2023 for the payment period
21

July 1, 2024 through December 31, 2025, and beginning in
22

calendar year 2026, the State fiscal year that ends 30
23

months before the applicable calendar year, such as State
24

fiscal year 2023 admissions received by the Department
25

prior to October 1, 2024, for calendar year 2026.
26

(c) The Department shall take all actions necessary to

SB3754
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LRB104 18306 KTG 31746 b
1
ensure the changes authorized in Public Act 103-102 and this
2
amendatory Act of the 103rd General Assembly are in effect for
3
dates of service on and after the effective date of the changes
4
made to this Section by this amendatory Act of the 103rd
5
General Assembly, including publishing all appropriate public
6
notices, applying for federal approval of amendments to the
7
Illinois Title XIX State Plan, and adopting administrative
8
rules if necessary.
9

(d) The Department of Healthcare and Family Services may
10
adopt rules necessary to implement the changes made by Public
11
Act 103-102 and this amendatory Act of the 103rd General
12
Assembly through the use of emergency rulemaking in accordance
13
with Section 5-45 of the Illinois Administrative Procedure
14
Act. The 24-month limitation on the adoption of emergency
15
rules does not apply to rules adopted under this Section. The
16
General Assembly finds that the adoption of rules to implement
17
the changes made by Public Act 103-102 and this amendatory Act
18
of the 103rd General Assembly is deemed an emergency and
19
necessary for the public interest, safety, and welfare.
20

(e) The Department shall ensure that all necessary
21
adjustments to the managed care organization capitation base
22
rates necessitated by the adjustments in this Section are
23
completed, published, and applied in accordance with Section
24
5-30.8 of this Code 90 days prior to the implementation date of
25
the changes required under Public Act 103-102 and this
26
amendatory Act of the 103rd General Assembly.

SB3754
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LRB104 18306 KTG 31746 b
1

(f) The Department shall publish updated rate sheets or
2
add-on payment amounts, as applicable, for all hospitals 30
3
days prior to the effective date of the rate increase, or
4
within 30 days after federal approval by the Centers for
5
Medicare and Medicaid Services, whichever is later.
6
(Source: P.A. 103-102, eff. 6-16-23; 103-593, eff. 6-7-24.)

7

Section 99.
Effective date.
This Act takes effect upon
8
becoming law.

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