Revision: March 27, 2014, midnight
SB 369-FN-A – AS AMENDED BY THE SENATE
03/13/14 0862s
03/13/14 0960s
2014 SESSION
10/01
SENATE BILL 369-FN-A
AN ACT relative to the Medicaid enhancement tax.
SPONSORS: Sen. Odell, Dist 8; Rep. Major, Rock 14
This bill removes the application of the Medicaid enhancement tax to special hospitals for rehabilitation contingent on approval of a waiver. The bill also changes payment of the tax to 4 times per year.
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Explanation: Matter added to current law appears in bold italics.
Matter removed from current law appears [in brackets and struckthrough.]
Matter which is either (a) all new or (b) repealed and reenacted appears in regular type.
03/13/14 0862s
03/13/14 0960s
14-2699
10/01
STATE OF NEW HAMPSHIRE
In the Year of Our Lord Two Thousand Fourteen
AN ACT relative to the Medicaid enhancement tax.
Be it Enacted by the Senate and House of Representatives in General Court convened:
1 Medicaid Enhancement Tax; Definition; Hospital. Amend RSA 84-A:1, III to read as follows:
III. “Hospital” means general hospitals [and special hospitals for rehabilitation] required to be licensed under RSA 151 that provide inpatient and outpatient hospital services, but not including government facilities.
2 Uncompensated Care Fund; Definition; Hospital. Amend RSA 167:63, IV to read as follows:
IV. “Hospital” means general hospitals [and special hospitals for rehabilitation] required to be licensed under RSA 151, but not including government facilities.
3 New Paragraph; Uncompensated Care Fund; Waiver Request. Amend RSA 167:65 by inserting after paragraph IV the following new paragraph:
V.(a) Submit a waiver request pursuant to the process outlined in 42 C.F.R. section 433.68 for the purpose of waiving RSA 84-A, Medicaid enhancement tax liability for HealthSouth Rehabilitation Hospital and Northeast Rehabilitation Hospital, and such waiver request to be submitted the United States Department of Health and Human Services no later than October 1, 2014; and
(b) Provide a complete copy of said waiver request to HealthSouth Rehabilitation Hospital and Northeast Rehabilitation Hospital simultaneously with its submission to the United?States Department of Health and Human Services.
4 Contingency; Medicaid Enhancement Tax; Uncompensated Care Fund; Definition of Hospital. Sections 1 and 2 of this act, deleting special hospitals for rehabilitation from the definition of “hospital” under the Medicaid enhancement tax and the uncompensated care fund, shall take effect on the approval date of the waiver request required in section 3 of this act, and shall apply to the taxable period ending June 30, 2014 and to every taxable period thereafter. The commissioner of health and human services shall certify the effective date to the secretary of state and the director of legislative services upon receipt of such approval.
5 Tax Due. RSA 84-A:3 is repealed and reenacted to read as follows:
84-A:3 Tax Due.
I. For the taxable period beginning July 1, 2014, and for every taxable period thereafter, each hospital shall pay 25 percent of its Medicaid enhancement tax due and payable for the taxable period no later than the fifteenth day of October, January, March, and June of the taxable period. Notwithstanding any provision of this chapter or any other law, no penalty or interest shall be imposed for failure to make payment of tax when due if such payment is made on or before the last day of the month in which such payment is due.
II. If the return required by RSA 84-A:4 shows an additional amount of tax to be due, such additional amount is due and payable at the time the return is due.
6 Returns. Amend RSA 84-A:4 to read as follows:
84-A:4 Returns. Every hospital shall on or before the [tenth] fifteenth day of [the month following the expiration of] June in the taxable period make a return to the commissioner. The commissioner shall adopt rules, pursuant to RSA 541-A, relative to the form of such return and the data which it must contain for the correct computation of net patient services revenue and the tax assessed upon such amount. All returns shall be signed by the taxpayer or by its authorized representative, subject to the pains and penalties of perjury. If such return shows an overpayment of the tax due, the commissioner shall refund or credit the overpayment to the hospital in accordance with RSA 21-J:28-a.
7 Method of Payment; Reference Corrected. Amend RSA 84-A:5, I to read as follows:
I. The payments required by RSA 84-A:3[, II-a] shall be made by electronic transfer of moneys to the state treasurer and deposited to the uncompensated care fund established by RSA?167:64.
8 Effective Date.
I. Sections 1 and 2 of this act shall take effect as provided in section 4 of this act.
II. Sections 5-7 of this act shall take effect July 1, 2014.
III. The remainder of this act shall take effect upon its passage.
LBAO
14-2699
Amended 03/18/14
SB 369-FN-A FISCAL NOTE
AN ACT relative to the Medicaid enhancement tax.
FISCAL IMPACT:
The Departments of Revenue Administration and Health and Human Services state this bill, as amended by the Senate (Amendments #2014-0862s and #2014-0960s), will reduce state revenue and expenditures by an indeterminable amount in FY 2014 and each year thereafter. This bill will have no fiscal impact on county or local revenue and expenditures.
METHODOLOGY:
The Department of Revenue Administration (DRA) states section 1 of this bill would remove application of the Medicaid Enhancement Tax (MET) to special hospitals for rehabilitation contingent upon federal approval of the waiver in sections 3 and 4 of the bill. These hospitals currently pay the Medicaid Enhancement Tax (MET) and exempting them from the MET would result in a decrease in state tax revenue. The Department states the specific fiscal impact cannot be disclosed because the information relates to fewer than five taxpayers and disclosure would identify, or permit identification of particular tax returns, reports, or related documents of the taxpayers and violate of RSA 21-J:14. Since the section applies to the current taxable period ending June 30, 2014, the Department assumes it may be necessary to issue refunds for MET paid by the rehabilitation hospitals for the current period. Since the section is contingent upon federal waiver approval, the Department cannot determine when the reduction in revenue would occur. The Department states it could administer this section without additional costs.
The Department of Revenue Administration states section 2 of the bill removes the term “special hospitals for rehabilitation” from the Uncompensated Care Fund law, RSA 167:63, IV. Section 3 of the bill inserts a new paragraph after RSA 167:65, IV that requires a federal waiver request for certain special hospitals for rehabilitation for the purpose of waiving RSA 84-A MET liability. Section 4 of the bill provides for the applicability of the aforementioned sections 1 and 2. DRA defers to the Department of Health and Human Services (DHHS) relative to statements on the fiscal impact on sections 2 through 4.
The Department of Revenue Administration states section 5 seeks to change payment of the MET from a single annual payment to quarterly payments payable no later than the 15th day of October, January, March and June of the taxable period. Section 6 of the bill would require an MET return on or before the 15th day of June of the taxable period. Said return is currently due on the 10th day of July of the taxable period. Section 7 changes the reference to payments required by RSA 84-A:3, II-a as there would no longer be a section II-a. DRA states sections 5 through 7 would have no impact on state revenue and could impact these provisions at no additional cost.
The Department of Health and Human Services states there are three rehabilitation hospitals in New Hampshire: Hampstead Hospital, Northeast Rehabilitation Hospital, and HealthSouth Rehabilitation Hospital. The Department states Hampstead Hospital has previously received an exemption from the MET tax and the impact of this bill would be to the taxes paid by Northeast and HealthSouth rehabilitation hospitals. The Department indicates removing these hospitals from the definition of hospital in the Uncompensated Care Fund and MET statutes would reduce the tax collected and the federal matching funds used to make uncompensated care payments to hospitals. In addition, the rehabilitation hospitals would no longer participate in the uncompensated care program and would not receive uncompensated care payments. Due to the confidentiality requirements in RSA 21-J:14, the Department is not able to disclose the specific amounts. The Department states changing payment of the MET tax from annual to quarterly would also impact the timing of uncompensated care payments to hospitals which are funded in part by the MET tax revenue. The Department assumes there may be refunds for the current tax period ending June 30, 2014 for MET payments made by the exempted hospitals.