S 7 RURAL HEALTH CARE DELIVERY FUND

Sen Elizabeth "Liz" Stefanics

Actions: [1] SHPAC/SFC-SHPAC [6] DP/a-SFC [10] DNP-CS/DP - PASSED/S (28-8) [13] HHHC-HHHC [15] DP [18] PASSED/H (69-0)

Scheduled: Not Scheduled

 Senate Bill 7 (SB 7) creates the Rural Health Care Delivery Fund (RHCDF) to provide grants to defray operating losses of rural health care providers and facilities related to the provision of health services, and to cover expenses or losses related to new or expanded services; an appropriation of $200,000,000 is made from the General Fund to the RHCDF. 

 The RHCDF is created as a nonreverting fund in the state treasury that consists of appropriations, gifts, grants, donations, income investments, and any other revenue credited to the fund. Rural health care providers and facilities may apply to the Human Services Department for grants to defray operating losses related to the provision of health services, and to cover expenses or losses related to new or expanded services. Specific conditions, requirements, limitations and definitions are provided. An appropriation of $200,000,000 is made from the General Fund to the RHCDF. 

 There is no specific fund currently in place to address expenses/losses incurred by rural health care providers/facilities in the delivery of new and/or expanded services. If the Bill does not pass, existing or alternate resources will need to be relied upon. 

 Amended January 30, 2023
SHPACa / SB 7: The Senate Health and Public Affairs Committee makes the following changes to Senate Bill 7:
•	On page 1, line 13, after "LOSSES", insert "AND START-UP COSTS". 
•	On page 2, line 7, after "losses", insert ", including rural health care provider or rural health care facility start-up costs,". 
•	On page 2, line 10, strike "newly constructed". 
•	On page 2, line 11, strike the first occurrence of "facility" and insert in lieu thereof "provider". 
•	On page 3, line 4, strike the semicolon and after "and", insert "can be confirmed as having been delivered through review of claims;". 
•	On page 3, between lines 4 and 5, insert the following new paragraph: "(5) grant award amounts shall be reconciled by the department to audited operating losses after the close of the grant period;". 
•	Renumber the succeeding paragraph accordingly. 
•	On page 3, line 7, strike the period and insert in lieu thereof "; and
•	On page 3, between lines 7 and 8, insert the following new paragraph: "(7) in prioritizing grant awards, the department shall consider the health needs of the state and the locality.". 
•	On page 3, line 11, after the comma, strike the remainder of the line and strike line 12 in its entirety and insert in lieu thereof "including reasonable direct expenses, but not including general overhead and management fees paid to a parent corporation;". 
•	On page 3, line 17, before "behavioral", insert "dental,". 
•	On page 3, line 18, before the semicolon, insert "and for medical or behavioral health ground transportation". 
•	On page 3, strike lines 19 and 20 in their entirety. 
•	Renumber the succeeding paragraphs accordingly. 
•	On page 4, line 9, strike "and is located" and insert in lieu thereof "or programmatic services". 
•	On page 4, line 11, strike "and". 
•	On page 4, line 13, before "or", insert "licensed by the appropriate board, a medical or behavioral health ground transportation licensed by the public regulation commission". 
•	On page 4, lines 15 and 16, strike "and is located" and insert in lieu thereof "or programmatic services". 
•	On page 4, line 18, strike the period and insert in lieu thereof "; and". 
•	(8) "start-up costs" means the planning, development and operation of rural health care services, including legal fees; accounting fees; costs associated with leasing equipment, a location or property; depreciation of equipment costs; and staffing costs. "Start-up costs" does not mean the construction or purchase of land or buildings."
 

 Committee Substitute February 28 2023 in SFC

SFCcs/SB 7: The Senate Finance Committee substitute for SB 7 makes the following changes:

•	The appropriation of $200,000,000 is removed;
•	A condition for the awarding of a grant is modified to require that the rural health care provider must provide cost data that can be confirmed as having been delivered through the review of claims;
•	A stipulation is added that grant award amounts must be reconciled by the department to the audited operating losses after the close of the grant period;
•	A stipulation is added that the provider must commit to actively serve Medicaid recipients throughout the duration of the grant period;
•	A condition is added that the department must consider the health needs of the state, the locality, and the long-term sustainability of the new or expanded service when prioritizing grant awards;
•	The definition of “allowable costs” is modified to clarify that “reasonable direct expenses” are included but that general overhead and management fees paid to a parent organization are excluded;
•	The definition of “health care services” is modified to add “medical or behavioral health ground transportation”;
•	Definitions are added to stipulate the meanings of “Medicaid”, “Medicaid Provider” and “Medicaid Recipient”;
•	The definitions of “rural health care facility” and “rural health care provider” are modified to include providers/facilities that offer “programmatic services”; and
•	The definition of “start-up costs” is added, meaning the planning, development and operation of rural health care services, including legal fees, accounting fees, costs associated with leasing equipment, alocation of property, depreciation of equipment costs, and staffing costs. The construction or purchase of land or buildings is explicitly excluded.
 

 HB 47, Rural health care project revolving fund
HB 38, Rural health care practitioner additions