Committee advances SB 305 to let hospitals increase assessments to draw federal Medicaid match

Sen. Vickers told the committee SB 305 would allow hospitals to levy an assessment that the state could use to draw additional federal Medicaid match, helping offset recent federal changes that reduced prior matching funds. "This portion would bring in about a net $70,000,000 to the hospitals," Sen. Vickers said, and he emphasized the bill imposes no net cost to the state general fund.

Dave Guesssel, executive vice president of the Utah Hospital Association, told the committee the mechanism requires a state-administered assessment that is broad-based across hospitals to comply with federal rules. He said Utah already pays more than $200 million a year in assessments to draw down federal match and that SB 305 would add roughly $33 million in assessments that could net about $70 million after the federal match is applied. Guesssel said the additional funds would be tied to quality measures negotiated with the federal Centers for Medicare & Medicaid Services (CMS).

Representative Hall pressed presenters for details on tax rates and how the assessment is divided across hospitals. Presenters said the assessment level is determined by formulas administered by the Department of Health, varies by hospital volume of Medicaid services, and that specific quality measures and administrative calculations would be defined in negotiation with CMS and state consultants.

Representative Ballard moved to pass SB 305 (substitute hospital quality incentive amendments). The committee approved the bill on a recorded voice vote of 17 in favor and 1 opposed; Representative Hall was recorded as the lone dissenting vote.