An Act amending the act of June 13, 1967 (P.L.31, No.21), known as the Human Services Code, in Pennsylvania Rural Health Redesign Center Authority, further providing for definitions, for Pennsylvania Rural Health Redesign Center Authority, for powers and duties, for roles of participating payers, for roles of participant rural hospitals and for data collection and retention; and making an editorial change.

PRINTER'S NO. 1312
THE GENERAL ASSEMBLY OF PENNSYLVANIA
SENATE BILL
No. 1095
Session of
2025
INTRODUCED BY BROOKS AND DUSH, NOVEMBER 17, 2025
REFERRED TO HEALTH AND HUMAN SERVICES, NOVEMBER 17, 2025
AN ACT
Amending the act of June 13, 1967 (P.L.31, No.21), entitled "An
act to consolidate, editorially revise, and codify the public
welfare laws of the Commonwealth," in Pennsylvania Rural
Health Redesign Center Authority, further providing for
definitions, for Pennsylvania Rural Health Redesign Center
Authority, for powers and duties, for roles of participating
payers, for roles of participant rural hospitals and for data
collection and retention; and making an editorial change.
The General Assembly of the Commonwealth of Pennsylvania
hereby enacts as follows:
Section 1. The definitions of "eligible hospital services,"
"global budget," "global budget model," "participant rural
hospital," "participating payer" and "rural hospital
transformation plan" in section 1403-D of the act of June 13,
1967 (P.L.31, No.21), known as the Human Services Code, are
amended and the section is amended by adding definitions to
read:
Section 1403-D. Definitions.
The following words and phrases when used in this article
shall have the meanings given to them in this section unless the
context clearly indicates otherwise:
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* * *
"Alternative payment model." An innovative payment and
service delivery model that is intended to reduce health care
costs while maintaining access to care, improving the quality of
care in rural counties and meeting the health needs of
participant rural hospitals' local communities, and under which
participating payers pay participant rural hospitals using an
alternative payment methodology established by the authority.
* * *
"Budget." The prospectively set annual budget that is the
basis for payment for each participant rural hospital for
eligible hospital services by participating payers.
* * *
"Eligible hospital services." [All inpatient] Inpatient and
hospital-based outpatient items and services. The term shall
exclude all other items and services[, including the following:
(1) Postacute care.
(2) Professional services.
(3) Durable medical equipment.
(4) Dental services.
(5) Noninpatient or non-hospital-based outpatient
behavioral health services.
(6) Long-term care services, except for swing bed
services for critical access hospitals.] as defined by the
authority.
* * *
["Global budget." The prospectively set annual budget that
is the basis for payment for each participant rural hospital for
eligible hospital services by participating payers.
"Global budget model." An innovative payment and service
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delivery model that is intended to reduce health care costs
while maintaining access to care, improving the quality of care
in rural counties and meeting the health needs of participant
rural hospitals' local communities, and under which
participating payers pay participant rural hospitals using a
global budget methodology established by the authority.]
* * *
"Participant rural hospital." A rural hospital that has been
selected and signs an agreement to participate in the [global
budget] alternative payment model.
"Participating payer." A payer that operates in rural
counties and, with respect to one or more specified products,
programs or payment arrangements, signs an agreement with the
authority to participate in the [global budget] alternative
payment model.
* * *
"Rural hospital transformation plan." A description of the
health care delivery system transformation that a participant
rural hospital will undergo under the [global budget]
alternative payment model, as approved by the board and the
Federal Government when appropriate.
* * *
Section 2. Sections 1411-D(b)(8) and 1412-D(a)(1) and (b)
(1), (5), (8), (9), (10), (11), (12), (13) and (14), Subarticle
C heading of Article XIV-D and sections 1421-D(a) and (b), 1422-
D(a) and (b)(2) and (3) and 1431-D(a) of the act are amended to
read:
Section 1411-D. Pennsylvania Rural Health Redesign Center
Authority.
* * *
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(b) Composition.--The board shall consist of the following
members:
* * *
(8) Two members appointed by the Governor who are
nationally recognized experts in rural health care delivery
or in developing and administering [global] budgets.
* * *
Section 1412-D. Powers and duties.
(a) General rule.--The board shall exercise all powers
necessary and appropriate to carry out its duties under this
article, including the following:
(1) Adopt bylaws necessary to carry out the provisions
of this article. The bylaws shall include a provision
addressing conflicts of interest as well as a provision that
restricts board discussions and decisions necessary to [the
administration of the global budget model as provided under
subsection (b)] fulfill the purposes of this article.
* * *
(b) [Global budget] Alternative payment model.--The board is
responsible for administering the [global budget] alternative
payment model and shall:
(1) Evaluate and select rural hospitals for
participation in the [global budget] alternative payment
model as a participant rural health hospital on the basis of
diversity, vision and commitment to health care delivery
transformation.
* * *
(5) Calculate, approve and administer [global] budgets.
The [global] budgets may include payments for eligible
hospital services provided under a participant rural
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hospital's employee health plan.
* * *
(8) Evaluate the progress of the implementation of each
participant rural hospital's [global] budget toward
population health improvement goals and the cost of achieving
health care goals.
(9) Monitor [global] budgets and quality metrics for
participant rural hospitals.
(10) Provide an annual assessment of each participant
rural hospital's compliance with its rural hospital
transformation plan and [global] budget targets.
(11) Require a participant rural hospital to submit a
corrective action plan for failure to submit a rural hospital
transformation plan, comply with its rural hospital
transformation plan or meet its [global] budget targets.
(12) Terminate a participant rural hospital from the
[global budget] alternative payment model in accordance with
the participant rural hospital's participation agreement.
(13) Contract with an independent evaluation group to
provide the board and executive director with an evaluation
of the [global budget] alternative payment model's progress
in the areas of population health, quality of care and cost
targets.
(14) Review and update the definition of "eligible
hospital services" by transmitting a notice to the
Legislative Reference Bureau for publication in the
Pennsylvania Bulletin[, subject to obtaining all necessary
Federal approvals]. The board shall use data collected under
paragraph (3) in its review.
* * *
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SUBARTICLE C
PARTICIPATION IN [GLOBAL BUDGET] ALTERNATIVE PAYMENT MODEL
Section 1421-D. Roles of participating payers.
(a) Letter of interest.--A payer may submit a letter of
interest to the authority to participate in the [global budget]
alternative payment model.
(b) Agreement to participate.--As a condition of
participation, a participating payer shall sign an agreement
with the authority. The agreement shall detail the terms and
conditions of participation in the [global budget] alternative
payment model.
* * *
Section 1422-D. Roles of participant rural hospitals.
(a) Letter of interest.--A rural hospital may submit a
letter of interest to the authority to participate in the
[global budget] alternative payment model.
(b) Condition of participation.--As a condition of
participation, the following shall occur:
* * *
(2) A participant rural hospital shall sign an agreement
with the authority. The agreement shall detail the terms and
conditions of participation in the [global budget]
alternative payment model.
(3) A participant rural hospital shall submit [annual]
updates to its rural hospital transformation plan in the
manner and form prescribed by the authority for review and
approval.
Section 1431-D. Data collection and retention.
(a) Authority.--The authority may collect and analyze data
from participating payers, rural hospitals, participant rural
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hospitals and the department necessary to carry out the
authority's responsibilities under this article. Data collected
by the authority shall only be used for administering the
[global budget] alternative payment model. The authority shall
obtain the written approval of a participating payer, rural
hospital, participant rural hospital or the department before
the authority can use the entity's data for any other purpose.
The authority shall retain the data for no more than seven
years.
* * *
Section 3. This act shall take effect in 60 days.
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