Section 1722 - Voluntary restraint1.Voluntary restraint. To control the rate of growth of the costs of hospital services, each hospital licensed under chapter 405 may voluntarily restrain cost increases and consolidated operating margins in accordance with this section. Each hospital shall annually report to the joint standing committee of the Legislature having jurisdiction over health and human services matters regarding its efforts made pursuant to this section. The targets and methodology apply to each hospitals fiscal year beginning on or after the effective date of this section. A. Each hospital may voluntarily hold its consolidated operating margin to no more than 3%. For purposes of this paragraph, a hospitals consolidated operating margin is calculated by dividing its consolidated operating income by its total consolidated operating revenue. [RR 2007, c. 2, §9(RAL).]B. Each hospital may voluntarily restrain its increase in its expense per casemix-adjusted inpatient and volume-adjusted outpatient discharge to no more than 110% of the forecasted increase in the hospital market basket index for the coming federal fiscal year, as published in the Federal Register, when the federal Centers for Medicare and Medicaid Services publishes the Medicare programs hospital inpatient prospective payment system rates for the coming federal fiscal year. For purposes of this paragraph, the measure of a hospitals expense per casemix-adjusted inpatient and volume-adjusted outpatient discharge is calculated by: (1) Calculating the hospitals total hospital-only expenses;(2) Subtracting from the hospitals total hospital-only expenses the amount of the hospitals bad debt;(3) Subtracting from the amount reached in subparagraph (2) the hospital taxes paid to the State during the hospitals fiscal year; and(4) Dividing the amount reached in subparagraph (3) by the product of: (a) The number of inpatient discharges, adjusted by the all payer case mix index for the hospital; and(b) The ratio of total gross patient service revenue to gross inpatient service revenue. For the purposes of this paragraph, a hospitals total hospital-only expenses include any item that is listed on the hospitals Medicare cost report as a subprovider, such as a psychiatric unit or rehabilitation unit, and does not include nonhospital cost centers shown on the hospitals Medicare cost report, such as home health agencies, nursing facilities, swing beds, skilled nursing facilities and hospital-owned physician practices. For purposes of this paragraph, a hospitals bad debt is as defined and reported in the hospitals Medicare cost report and as submitted to the Maine Health Data Organization pursuant to chapter 1683. [2023, c. 405, Pt. A, §51(AMD).]
[2023, c. 405, Pt. A, §51(AMD).]
Amended by 2023SP1, c. 405,§ A-51, eff. 7/10/2023.RR 2007, c. 2, § 9 (RAL) .