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New Jersey is Considering Expanding the County Option Hospital Fee Program

By Paul L. Croce on July 6, 2022
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New Jersey has proposed additional legislation (A4091 and S2729) to adopt the state’s County Option Hospital Fee Pilot Program on a permanent basis. The proposed legislation is currently being reviewed by the Senate Budget and Appropriations Committee and it is anticipated it will be enacted, expanding the program from the current seven participating counties (Atlantic, Camden, Essex, Hudson, Mercer, Middlesex, and Passaic) to include five counties (Bergen, Burlington, Cumberland, Monmouth, and Ocean).

By way of background, New Jersey adopted the County Option Hospital Fee Pilot Program Act on November 1, 2018. The goals of the pilot program are (1) to increase financial resources through the Medicaid program to support local hospitals and ensure they continue to provide necessary services to low-income citizens; and (2) to provide participating counties with new fiscal resources.

Under the pilot program, the initial seven participating counties are authorized to impose a local healthcare related fee on hospitals within their borders. The funds collected from the fee are subject to a federal match, provided they do not exceed the federal Department of Human Services (DHS) limit.

At least 90% of the funds collected from the fee imposed are to be used for the benefit of hospitals within the county to ensure they continue to provide necessary services to low-income citizens. Specifically, such funds may be used to: (1) increase Medicaid/NJ FamilyCare payments to hospitals in the county; (2) make payments to Medicaid/NJ FamilyCare managed care organizations operating in the participating county for increased hospital or hospital-related payments; and/or (3) pay costs directly related to the administration of the pilot program.

As a pilot program, the County Option was intended to last only five years, which would begin to run 180 days after its November 1, 2018 enactment.  However, due to delays in obtaining federal approval of the program, in 2021, the State Legislature clarified that the five-year period would not begin to run until each participating county had begun to collect the healthcare related fee.  The pilot program is now scheduled to expire in the fall of 2026. However, the proposed legislation would make the program permanent.

Hospitals in Bergen, Burlington, Cumberland, Monmouth and Ocean counties should pay close attention to this proposed expansion of the program and begin analyzing the potential impact on their Medicaid reimbursement.

Photo of Paul L. Croce Paul L. Croce

Counsel, Healthcare

Paul is a healthcare attorney and litigator with focused expertise in hospital reimbursement and guardianship matters. He represents hospitals and healthcare systems before the Department of Health and the Division of Medical Assistance and Health Services in Medicaid and Medicare appeals…

Counsel, Healthcare

Paul is a healthcare attorney and litigator with focused expertise in hospital reimbursement and guardianship matters. He represents hospitals and healthcare systems before the Department of Health and the Division of Medical Assistance and Health Services in Medicaid and Medicare appeals, Disproportionate Share Hospital (DSH) subsidy appeals, Graduate Medical Education (GME) subsidy appeals, and other legal challenges.

Paul represents nursing homes, assisted living facilities and other long-term care providers in guardianship applications seeking the appointment of permanent or temporary guardians to make necessary decisions for residents who lack capacity and appropriate surrogate decision-makers.

As a healthcare litigator, Paul has experience with Fifth Amendment Takings cases, matters involving nursing home discharges, and the defense of breach of contract and tortious interference claims. His work also includes the defense of attorneys and other licensed professionals against claims of malpractice and ethics grievances. He provides counsel on issues related to contracting, civil litigation and professional licensing matters, representing a variety of healthcare industry clients including physicians, dentists, hospitals and for-profit and nonprofit healthcare systems.

Results may vary depending on your particular facts and legal circumstances.

Contact information:

pcroce@greenbaumlaw.com | 973.577.1806 | vCard | LinkedIn

For more information visit the Greenbaum, Rowe, Smith & Davis LLP website.

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  • Posted in:
    Health Care and Life Sciences
  • Blog:
    Healthcare Perspectives
  • Organization:
    Greenbaum, Rowe, Smith & Davis LLP
  • Article: View Original Source

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