ARTICLE 35 SUBSTITUTE A

RELATING TO MEDICAL ASSISTANCE -- COMMUNITY HEALTH CENTERS

SECTION 1. Section 40-16-1 of the General Laws in Chapter 40-16 entitled “Community Health Centers” is hereby repealed.

§ 40-16-1. Funding of community health center. – (a)(1) For the fiscal year ending June 30, 1989, and for each year thereafter the state shall contribute a share of the costs associated with community health centers as provided in this chapter. Subject to the provisions of subsection (i), the state's share shall be calculated by multiplying the total number of medical patients treated at the health centers listed below by the sum of thirteen dollars and thirty-four cents ($13.34) for each patient; provided, that multiple visits or treatment shall be counted only once, by the state department of human services for grants to the following health centers:

(2) Providence Community Health Centers, Inc., Thundermist health associates, inc., Blackstone Valley community health care inc., Wood River health services, Family health services, East Bay Family Health Care, new visions for Newport County, tri-town health center, Dr. John A. Ferris health center, Chad Brown health center, health center of South County, Bayside family healthcare, Northwest health center and Block Island health services inc.; that sum shall be allocated by the department of human services as follows:

(i) One-half (1/2) of the state share in each fiscal year to be divided equally among the fourteen (14) health centers listed in subsection (a)(2); and

(ii) One-half (1/2) of the state share to be allocated among the health centers listed in subsection (a)(2) based on a per capita rate multiplied by the number of medical patients each center treated in the previous fiscal year; that per capita rate to be computed by dividing this half of the state share by the total number of medical patients treated by all aforesaid health centers in the previous fiscal year; each patient notwithstanding multiple visits or treatment, shall be counted once only.

(b) If the sum appropriated by the state for any fiscal year for making payments to the health centers listed in subsection (a)(2) under this program is not sufficient to pay in full the total amount which all the health centers listed in subsection (a)(2) are entitled to receive for that fiscal year, the maximum entitlement which all the health centers listed in subsection (a)(2) shall receive for such fiscal year shall be ratably reduced.

(c) The appropriation of six hundred seventy-three thousand five hundred dollars ($673,500) for the fiscal year ending June 30, 1988, for the state department of human services for distribution to the health centers listed above shall be allocated as follows: three hundred thirty-six thousand seven hundred fifty dollars ($336,750) to be divided, equally, among the fourteen (14) health centers cited and three hundred thirty-six thousand seven hundred fifty dollars ($336,750) to be allocated among the health centers on a per capita rate of ten dollars ($10.00) for each patient.

(d) If the sum appropriated by the state for any fiscal year exceeds the amount to be distributed based upon the provisions of this section, the excess shall be distributed equally among the fourteen (14) designated health centers.

(e) In December of each year, the department of human services shall forward to the chairperson of the house finance committee and to the chairperson of the senate finance committee the proposed unduplicated per patient rate for the next fiscal year.

(f) In the event that a designated grantee shall cease to operate, then its share shall revert to the general fund.

(g) For purposes of this section, "reference year" shall mean the second fiscal year immediately proceeding the fiscal year of appropriation.

(h) For purposes of this section "unduplicated medical patient" shall mean an individual who receives service at a community health center. An individual can be counted only once and multiple visits by and/or multiple treatments of the individual shall not be counted.

(i) For as long as the United States department of health and human services, health care financing administration project No. 11-W-00004/1-01 entitled "RIte Care" remains in effect and the state is paying health maintenance organizations to care for RIte Care enrollees, the state's annual share of costs associated with community health centers to be paid under this chapter shall be an amount no less than $718,015, which amount shall be appropriated to the Rhode Island department of human services. The department of human services shall obtain federal matching funds for the state's annual share to the fullest extent permitted under Title XIX of the Social Security Act, 42 U.S.C. § 1396 et seq.

(2) In order to encourage federally qualified health centers and rural health centers to participate in RIte Care, for as long as RIte Care remains in effect, all funds appropriated under this chapter and all federal funds matched thereto, shall be paid by the department of human services, without deduction for administrative or other expenses, to Rhode Island health center association, inc., provided that a majority of the health centers referred to in subsection (a) constitute a majority of the members of Rhode Island health center association, inc., and continue to participate as primary care providers in the RIte Care program of the health centers referred to in subsection (a). Such amounts shall be paid monthly to Rhode Island health center association, inc. by the department of human services at the rate of fifteen dollars ($15.00) per member per month for each RIte Care member (regardless of health plan) selecting a federally qualified health center or rural health center, as those terms are defined in 42 U.S.C. § 1395x (or any successor statute), as the member's primary care provider.

(3) In no event shall the amounts payable under this subsection exceed five million five hundred thousand dollars ($5,500,000) per fiscal year. In any fiscal year, if any portion of the state share appropriated in this subsection is not used to obtain federal matching funds and pay the amounts due under subsection (i)(2), the unused portion of the appropriation shall be distributed by the department of human services equally among the fourteen (14) health centers named in subsection (a). This subsection shall be inapplicable and the remaining provisions of this chapter shall apply if at any time a majority of the health centers referred to in subsection (a) do not constitute a majority of the members of Rhode Island health center association, inc. and do not participate as primary care providers in the RIte Care program.

(4) Rhode Island health center association, inc., shall be entitled to disburse the funds paid under this subsection to federally qualified health centers, rural health centers, other health centers or other entities in the manner it considers necessary or appropriate to encourage maximal participation of federally qualified health centers and rural health centers in RIte Care.

(5) The department of human services shall require each qualifying center or entity receiving funds under this chapter to: (a) file uniform cost and utilization reports with the department beginning January 1, 2000; and (b) to certify to the department that it will provide, beginning July 1, 2000, a proportional share of the operating expenses of the management service organization, CHC Enterprise, Inc., formed by qualifying centers or entities.

(j) To support the ability of federally qualified health centers and rural health centers to provide high quality medical care to patients, reimbursement under the medical assistance program for medically necessary services which are paid on a fee for service basis shall continue to be paid at one hundred percent (100%) of the reasonable cost.

SECTION 2. Chapter 40-8 of the General Laws entitled “Medical Assistance” is hereby amended by adding thereto the following section:

§ 40-8-26. Community Health Centers.-- (a) For the purposes of this section the term Community Health Centers refers to Federally Qualified Health Centers and Rural Health Centers.

(b) To support the ability of community health centers to provide high quality medical care to patients, the department of human services shall adopt and implement a methodology for determining a Medicaid per visit reimbursement for community health centers which is compliant with the prospective payment system provided for in the Medicare, Medicaid and SCHIP Benefits Improvement and Protection Act of 2001. The following principles are to assure that the prospective payment rate determination methodology is part of the department of human services’ overall value purchasing approach:

(c) The rate determination methodology will (i) fairly recognize the reasonable costs of providing services. Recognized reasonable costs will be those appropriate for the organization, management and direct provision of services and (ii) provide assurances to the department of human services that services are provided in an effective and efficient manner, consistent with industry standards. Except for demonstrated cause and at the discretion of the department of human services, the maximum reimbursement rate for a service (e.g. medical, dental) provided by an individual community health center shall not exceed one hundred twenty-five percent (125%) of the median rate for all community health centers within Rhode Island.

(d) Community health centers will cooperate fully and timely with reporting requirements established by the department.

(e) Reimbursement rates established through this methodology shall be incorporated into the PPS reconciliation for services provided to Medicaid eligible persons who are enrolled in a health plan on the date of service. Monthly payments by DHS related to PPS for persons enrolled in a health plan shall be made directly to the community health centers.

SECTION 3. This article shall take effect upon passage.