Medicaid; revise tax assessment rates for hospitals.
SB 2391 revises Mississippi’s hospital assessment statute to replace or supplement the existing inpatient-day-based hospital assessment structure with a net patient revenue-based formula for licensed hospitals. Under the bill, licensed psychiatric hospitals would be assessed 40% of net patient revenue, while other licensed hospitals would be assessed 1% of net patient revenue up to $20 million, 9.28% of net patient revenue above $20 million up to $200 million, and an additional annually determined percentage on revenue above $200 million to cover the remaining required assessment amount. The bill also exempts hospitals operated by the U.S. Department of Veterans Affairs and hospitals operated by the State Department of Mental Health from these assessments.
The measure keeps the broader Medicaid financing framework intact by directing assessment revenues into the Medical Care Fund and tying the assessment to Mississippi’s ability to maximize federal Medicaid supplemental payments, including Disproportionate Share Hospital (DSH), Upper Payment Limit (UPL), and Mississippi Hospital Access Program (MHAP) payments. It preserves existing enforcement tools for unpaid assessments, including Medicaid payment withholding, civil collection by the Attorney General, and tax lien procedures. The bill also retains reporting, recordkeeping, CMS submission, and contingency provisions if federal approval is denied or revoked, and it sunsets the section on July 1, 2028.
The bill’s impact on state law would be significant for hospital financing and Medicaid provider assessments. It amends Section 43-13-145 of the Mississippi Code to redefine how hospital assessments are calculated, shifting from a formula centered on non-Medicare inpatient days and state matching percentages to a revenue-based assessment structure. Hospitals would need to track and report net patient revenue under the new method, and the Division of Medicaid would have to administer the revised rates, determine the final percentage for revenue above $200 million, and continue coordinating with CMS to preserve federal matching funds.
No committee transcripts or recorded votes were provided, so there is no direct evidence of debate or formal support/opposition in the available materials. Based on the bill text alone, the general policy direction appears to be administrative and fiscal rather than ideological: it is designed to stabilize or restructure hospital assessments to support Medicaid financing and supplemental payments. The main likely point of contention is the financial burden on hospitals, especially psychiatric hospitals and larger hospital systems, which would face a new revenue-based assessment formula and potentially higher obligations, while VA and state mental health facilities are explicitly shielded from the tax.
SB 2391 would amend Mississippi Code Section 43-13-145 to change the hospital assessment mechanism used to finance Medicaid-related supplemental payments. It would replace the current assessment approach for licensed hospitals with a net patient revenue formula, establish different rates for psychiatric and non-psychiatric hospitals, exempt certain public facilities, and preserve the existing collection, enforcement, reporting, and federal-approval safeguards. The bill would also continue directing collections to the Medical Care Fund and would remain in effect only until July 1, 2028, unless renewed or replaced.
No committee discussion or vote history was provided, so there is no documented legislative sentiment in the record supplied. From the bill text, the measure appears to be a technical Medicaid financing proposal intended to maximize federal matching funds and maintain supplemental hospital payments. The overall tone is pragmatic and budget-focused, though the assessment increases and formula changes suggest that hospitals may view it as a significant new financial obligation.
The primary likely point of contention is the size and structure of the hospital assessment, particularly the 40% assessment on psychiatric hospitals and the tiered revenue-based charges on other hospitals. Hospitals with higher net patient revenue may object to the new formula, while smaller hospitals may be concerned about administrative complexity and cash-flow effects. Another likely issue is the exemption of VA hospitals and state mental health facilities, which creates different treatment among providers. Because no transcripts or votes were provided, these concerns are inferred from the bill’s provisions rather than from recorded debate.