Medicare certified long-term acute care hospitals; exempt from the hospital provider assessment subject to approval by CMS.

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To: Medicaid
MISSISSIPPI LEGISLATURE REGULAR SESSION 2026

By: Senator(s) Blackwell

SENATE BILL NO. 2695
(As Passed the Senate)

AN ACT TO AMEND SECTION 43-13-145, MISSISSIPPI CODE OF 1972, 1
TO PROVIDE THAT THE DIVISION MAY EXEMPT MEDICARE-CERTIFIED 2
LONG-TERM ACUTE CARE HOSPITALS FROM THE HOSPITAL ASSESSMENT USED 3
FOR FUNDING THE MEDICAID PROGRAM IF SUCH EXEMPTION IS APPROVED BY 4
THE CENTERS FOR MEDICARE AND MEDICAID SERVICES (CMS) AND DOES NOT 5
RESULT IN THE STATE RECEIVING A LOWER FEDERAL FINANCIAL 6
PARTICIPATION RATE FOR ANY AUTHORIZED SUPPLEMENTAL PAYMENT 7
PROGRAM; AND FOR RELATED PURPOSES. 8
BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF MISSISSIPPI: 9
SECTION 1. Section 43-13-145, Mississippi Code of 1972, is 10
amended as follows: 11
43-13-145. (1) (a) Upon each nursing facility licensed by 12
the State of Mississippi, there is levied an assessment in an 13
amount set by the division, equal to the maximum rate allowed by 14
federal law or regulation, for each licensed and occupied bed of 15
the facility. 16
(b) A nursing facility is exempt from the assessment 17
levied under this subsection if the facility is operated under the 18
direction and control of: 19
(i) The United States Veterans Administration or 20
other agency or department of the United States government; or 21
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(ii) The State Veterans Affairs Board. 22
(2) (a) Upon each intermediate care facility for 23
individuals with intellectual disabilities licensed by the State 24
of Mississippi, there is levied an assessment in an amount set by 25
the division, equal to the maximum rate allowed by federal law or 26
regulation, for each licensed and occupied bed of the facility. 27
(b) An intermediate care facility for individuals with 28
intellectual disabilities is exempt from the assessment levied 29
under this subsection if the facility is operated under the 30
direction and control of: 31
(i) The United States Veterans Administration or 32
other agency or department of the United States government; 33
(ii) The State Veterans Affairs Board; or 34
(iii) The University of Mississippi Medical 35
Center. 36
(3) (a) Upon each psychiatric residential treatment 37
facility licensed by the State of Mississippi, there is levied an 38
assessment in an amount set by the division, equal to the maximum 39
rate allowed by federal law or regulation, for each licensed and 40
occupied bed of the facility. 41
(b) A psychiatric residential treatment facility is 42
exempt from the assessment levied under this subsection if the 43
facility is operated under the direction and control of: 44
(i) The United States Veterans Administration or 45
other agency or department of the United States government; 46
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(ii) The University of Mississippi Medical Center; 47
or 48
(iii) A state agency or a state facility that 49
either provides its own state match through intergovernmental 50
transfer or certification of funds to the division. 51
(4) Hospital assessment. 52
(a) (i) Subject to and upon fulfillment of the 53
requirements and conditions of paragraph (f) below, and 54
notwithstanding any other provisions of this section, an annual 55
assessment on each hospital licensed in the state is imposed on 56
each non-Medicare hospital inpatient day as defined below at a 57
rate that is determined by dividing the sum prescribed in this 58
subparagraph (i), plus the nonfederal share necessary to maximize 59
the Disproportionate Share Hospital (DSH) and Medicare Upper 60
Payment Limits (UPL) Program payments and hospital access payments 61
and such other supplemental payments as may be developed pursuant 62
to Section 43-13-117(A)(18), by the total number of non-Medicare 63
hospital inpatient days as defined below for all licensed 64
Mississippi hospitals, except as provided in paragraph (d) below. 65
If the state-matching funds percentage for the Mississippi 66
Medicaid program is sixteen percent (16%) or less, the sum used in 67
the formula under this subparagraph (i) shall be Seventy-four 68
Million Dollars ($74,000,000.00). If the state-matching funds 69
percentage for the Mississippi Medicaid program is twenty-four 70
percent (24%) or higher, the sum used in the formula under this 71
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subparagraph (i) shall be One Hundred Four Million Dollars 72
($104,000,000.00). If the state-matching funds percentage for the 73
Mississippi Medicaid program is between sixteen percent (16%) and 74
twenty-four percent (24%), the sum used in the formula under this 75
subparagraph (i) shall be a pro rata amount determined as follows: 76
the current state-matching funds percentage rate minus sixteen 77
percent (16%) divided by eight percent (8%) multiplied by Thirty 78
Million Dollars ($30,000,000.00) and add that amount to 79
Seventy-four Million Dollars ($74,000,000.00). However, no 80
assessment in a quarter under this subparagraph (i) may exceed the 81
assessment in the previous quarter by more than Three Million 82
Seven Hundred Fifty Thousand Dollars ($3,750,000.00) (which would 83
be Fifteen Million Dollars ($15,000,000.00) on an annualized 84
basis). The division shall publish the state-matching funds 85
percentage rate applicable to the Mississippi Medicaid program on 86
the tenth day of the first month of each quarter and the 87
assessment determined under the formula prescribed above shall be 88
applicable in the quarter following any adjustment in that 89
state-matching funds percentage rate. The division shall notify 90
each hospital licensed in the state as to any projected increases 91
or decreases in the assessment determined under this subparagraph 92
(i). However, if the Centers for Medicare and Medicaid Services 93
(CMS) does not approve the provision in Section 43-13-117(39) 94
requiring the division to reimburse crossover claims for inpatient 95
hospital services and crossover claims covered under Medicare Part 96
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B for dually eligible beneficiaries in the same manner that was in 97
effect on January 1, 2008, the sum that otherwise would have been 98
used in the formula under this subparagraph (i) shall be reduced 99
by Seven Million Dollars ($7,000,000.00). 100
(ii) In addition to the assessment provided under 101
subparagraph (i), an additional annual assessment on each hospital 102
licensed in the state is imposed on each non-Medicare hospital 103
inpatient day as defined below at a rate that is determined by 104
dividing twenty-five percent (25%) of any provider reductions in 105
the Medicaid program as authorized in Section 43-13-117(F) for 106
that fiscal year up to the following maximum amount, plus the 107
nonfederal share necessary to maximize the Disproportionate Share 108
Hospital (DSH) and inpatient Medicare Upper Payment Limits (UPL) 109
Program payments and inpatient hospital access payments, by the 110
total number of non-Medicare hospital inpatient days as defined 111
below for all licensed Mississippi hospitals: in fiscal year 112
2010, the maximum amount shall be Twenty-four Million Dollars 113
($24,000,000.00); in fiscal year 2011, the maximum amount shall be 114
Thirty-two Million Dollars ($32,000,000.00); and in fiscal year 115
2012 and thereafter, the maximum amount shall be Forty Million 116
Dollars ($40,000,000.00). Any such deficit in the Medicaid 117
program shall be reviewed by the PEER Committee as provided in 118
Section 43-13-117(F). 119
(iii) In addition to the assessments provided in 120
subparagraphs (i) and (ii), an additional annual assessment on 121
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each hospital licensed in the state is imposed pursuant to the 122
provisions of Section 43-13-117(F) if the cost-containment 123
measures described therein have been implemented and there are 124
insufficient funds in the Health Care Trust Fund to reconcile any 125
remaining deficit in any fiscal year. If the Governor institutes 126
any other additional cost-containment measures on any program or 127
programs authorized under the Medicaid program pursuant to Section 128
43-13-117(F), hospitals shall be responsible for twenty-five 129
percent (25%) of any such additional imposed provider cuts, which 130
shall be in the form of an additional assessment not to exceed the 131
twenty-five percent (25%) of provider expenditure reductions. 132
Such additional assessment shall be imposed on each non-Medicare 133
hospital inpatient day in the same manner as assessments are 134
imposed under subparagraphs (i) and (ii). 135
(b) Definitions. 136
(i) [Deleted] 137
(ii) For purposes of this subsection (4): 138
1. "Non-Medicare hospital inpatient day" 139
means total hospital inpatient days including subcomponent days 140
less Medicare inpatient days including subcomponent days from the 141
hospital's most recent Medicare cost report for the second 142
calendar year preceding the beginning of the state fiscal year, on 143
file with CMS per the CMS HCRIS database, or cost report submitted 144
to the Division if the HCRIS database is not available to the 145
division, as of June 1 of each year. 146
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a. Total hospital inpatient days shall 147
be the sum of Worksheet S-3, Part 1, column 8 row 14, column 8 row 148
16, and column 8 row 17, excluding column 8 rows 5 and 6. 149
b. Hospital Medicare inpatient days 150
shall be the sum of Worksheet S-3, Part 1, column 6 row 14, column 151
6 row 16.00, and column 6 row 17, excluding column 6 rows 5 and 6. 152
c. Inpatient days shall not include 153
residential treatment or long-term care days. 154
2. "Subcomponent inpatient day" means the 155
number of days of care charged to a beneficiary for inpatient 156
hospital rehabilitation and psychiatric care services in units of 157
full days. A day begins at midnight and ends twenty-four (24) 158
hours later. A part of a day, including the day of admission and 159
day on which a patient returns from leave of absence, counts as a 160
full day. However, the day of discharge, death, or a day on which 161
a patient begins a leave of absence is not counted as a day unless 162
discharge or death occur on the day of admission. If admission 163
and discharge or death occur on the same day, the day is 164
considered a day of admission and counts as one (1) subcomponent 165
inpatient day. 166
(c) The assessment provided in this subsection is 167
intended to satisfy and not be in addition to the assessment and 168
intergovernmental transfers provided in Section 43-13-117(A)(18). 169
Nothing in this section shall be construed to authorize any state 170
agency, division or department, or county, municipality or other 171
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local governmental unit to license for revenue, levy or impose any 172
other tax, fee or assessment upon hospitals in this state not 173
authorized by a specific statute. 174
(d) Hospitals operated by the United States Department 175
of Veterans Affairs and state-operated facilities that provide 176
only inpatient and outpatient psychiatric services shall not be 177
subject to the hospital assessment provided in this subsection. 178
(e) At the discretion of the division, 179
Medicare-certified long-term acute care hospitals may be exempted 180
from the hospital assessment provided in this chapter if such 181
exemption is approved by the Centers for Medicare and Medicaid 182
Services (CMS) and does not result in the state receiving a lower 183
federal financial participation rate for any supplemental payment 184
program authorized by this chapter. 185
( * * *f) Multihospital systems, closure, merger, 186
change of ownership and new hospitals. 187
(i) If a hospital conducts, operates or maintains 188
more than one (1) hospital licensed by the State Department of 189
Health, the provider shall pay the hospital assessment for each 190
hospital separately. 191
(ii) Notwithstanding any other provision in this 192
section, if a hospital subject to this assessment operates or 193
conducts business only for a portion of a fiscal year, the 194
assessment for the state fiscal year shall be adjusted by 195
multiplying the assessment by a fraction, the numerator of which 196
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is the number of days in the year during which the hospital 197
operates, and the denominator of which is three hundred sixty-five 198
(365). Immediately upon ceasing to operate, the hospital shall 199
pay the assessment for the year as so adjusted (to the extent not 200
previously paid). 201
(iii) The division shall determine the tax for new 202
hospitals and hospitals that undergo a change of ownership in 203
accordance with this section, using the best available 204
information, as determined by the division. 205
( * * *g) Applicability. 206
The hospital assessment imposed by this subsection shall not 207
take effect and/or shall cease to be imposed if: 208
(i) The assessment is determined to be an 209
impermissible tax under Title XIX of the Social Security Act; or 210
(ii) CMS revokes its approval of the division's 211
2009 Medicaid State Plan Amendment for the methodology for DSH 212
payments to hospitals under Section 43-13-117(A)(18). 213
(5) Each health care facility that is subject to the 214
provisions of this section shall keep and preserve such suitable 215
books and records as may be necessary to determine the amount of 216
assessment for which it is liable under this section. The books 217
and records shall be kept and preserved for a period of not less 218
than five (5) years, during which time those books and records 219
shall be open for examination during business hours by the 220
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division, the Department of Revenue, the Office of the Attorney 221
General and the State Department of Health. 222
(6) [Deleted] 223
(7) All assessments collected under this section shall be 224
deposited in the Medical Care Fund created by Section 43-13-143. 225
(8) The assessment levied under this section shall be in 226
addition to any other assessments, taxes or fees levied by law, 227
and the assessment shall constitute a debt due the State of 228
Mississippi from the time the assessment is due until it is paid. 229
(9) (a) If a health care facility that is liable for 230
payment of an assessment levied by the division does not pay the 231
assessment when it is due, the division shall give written notice 232
to the health care facility demanding payment of the assessment 233
within ten (10) days from the date of delivery of the notice. If 234
the health care facility fails or refuses to pay the assessment 235
after receiving the notice and demand from the division, the 236
division shall withhold from any Medicaid reimbursement payments 237
that are due to the health care facility the amount of the unpaid 238
assessment and a penalty of ten percent (10%) of the amount of the 239
assessment, plus the legal rate of interest until the assessment 240
is paid in full. If the health care facility does not participate 241
in the Medicaid program, the division shall turn over to the 242
Office of the Attorney General the collection of the unpaid 243
assessment by civil action. In any such civil action, the Office 244
of the Attorney General shall collect the amount of the unpaid 245
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assessment and a penalty of ten percent (10%) of the amount of the 246
assessment, plus the legal rate of interest until the assessment 247
is paid in full. 248
(b) As an additional or alternative method for 249
collecting unpaid assessments levied by the division, if a health 250
care facility fails or refuses to pay the assessment after 251
receiving notice and demand from the division, the division may 252
file a notice of a tax lien with the chancery clerk of the county 253
in which the health care facility is located, for the amount of 254
the unpaid assessment and a penalty of ten percent (10%) of the 255
amount of the assessment, plus the legal rate of interest until 256
the assessment is paid in full. Immediately upon receipt of 257
notice of the tax lien for the assessment, the chancery clerk 258
shall forward the notice to the circuit clerk who shall enter the 259
notice of the tax lien as a judgment upon the judgment roll and 260
show in the appropriate columns the name of the health care 261
facility as judgment debtor, the name of the division as judgment 262
creditor, the amount of the unpaid assessment, and the date and 263
time of enrollment. The judgment shall be valid as against 264
mortgagees, pledgees, entrusters, purchasers, judgment creditors 265
and other persons from the time of filing with the clerk. The 266
amount of the judgment shall be a debt due the State of 267
Mississippi and remain a lien upon the tangible property of the 268
health care facility until the judgment is satisfied. The 269
judgment shall be the equivalent of any enrolled judgment of a 270
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court of record and shall serve as authority for the issuance of 271
writs of execution, writs of attachment or other remedial writs. 272
(10) (a) To further the provisions of Section 273
43-13-117(A)(18), the Division of Medicaid shall submit to the 274
Centers for Medicare and Medicaid Services (CMS) any documents 275
regarding the hospital assessment established under subsection (4) 276
of this section. In addition to defining the assessment 277
established in subsection (4) of this section if necessary, the 278
documents shall describe any supplement payment programs and/or 279
payment methodologies as authorized in Section 43-13-117(A)(18) if 280
necessary. 281
(b) All hospitals satisfying the minimum federal DSH 282
eligibility requirements (Section 1923(d) of the Social Security 283
Act) may, subject to OBRA 1993 payment limitations, receive a DSH 284
payment. This DSH payment shall expend the balance of the federal 285
DSH allotment and associated state share not utilized in DSH 286
payments to state-owned institutions for treatment of mental 287
diseases. The payment to each hospital shall be calculated by 288
applying a uniform percentage to the uninsured costs of each 289
eligible hospital, excluding state-owned institutions for 290
treatment of mental diseases; however, that percentage for a 291
state-owned teaching hospital located in Hinds County shall be 292
multiplied by a factor of two (2). 293
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(11) The division shall implement DSH and supplemental 294
payment calculation methodologies that result in the maximization 295
of available federal funds. 296
(12) The DSH payments shall be paid on or before December 297
31, March 31, and June 30 of each fiscal year, in increments of 298
one-third (1/3) of the total calculated DSH amounts. Supplemental 299
payments developed pursuant to Section 43-13-117(A)(18) shall be 300
paid monthly. 301
(13) Payment. 302
(a) The hospital assessment as described in subsection 303
(4) for the nonfederal share necessary to maximize the Medicare 304
Upper Payments Limits (UPL) Program payments and hospital access 305
payments and such other supplemental payments as may be developed 306
pursuant to Section 43-3-117(A)(18) shall be assessed and 307
collected monthly no later than the fifteenth calendar day of each 308
month. 309
(b) The hospital assessment as described in subsection 310
(4) for the nonfederal share necessary to maximize the 311
Disproportionate Share Hospital (DSH) payments shall be assessed 312
and collected on December 15, March 15 and June 15. 313
(c) The annual hospital assessment and any additional 314
hospital assessment as described in subsection (4) shall be 315
assessed and collected on September 15 and on the 15th of each 316
month from December through June. 317
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ST: Medicare certified long-term acute care
hospitals; exempt from the hospital provider
assessment subject to approval by CMS.
(14) If for any reason any part of the plan for annual DSH 318
and supplemental payment programs to hospitals provided under 319
subsection (10) of this section and/or developed pursuant to 320
Section 43-13-117(A)(18) is not approved by CMS, the remainder of 321
the plan shall remain in full force and effect. 322
(15) Nothing in this section shall prevent the Division of 323
Medicaid from facilitating participation in Medicaid supplemental 324
hospital payment programs by a hospital located in a county 325
contiguous to the State of Mississippi that is also authorized by 326
federal law to submit intergovernmental transfers (IGTs) to the 327
State of Mississippi to fund the state share of the hospital's 328
supplemental and/or MHAP payments. 329
(16) This section shall stand repealed on July 1, 2028. 330
SECTION 2. This act shall take effect and be in force from 331
and after July 1, 2026. 332