§1189.2. Legislative findings; purpose

            A. The legislature finds that:

            (1) Small rural hospitals provide most of the healthcare services required by a substantial number of low-income rural residents living in the state and therefore constitute an invaluable part of the healthcare delivery system of the state.

            (2) Residents living in rural areas of the state, which consist of sixty-four percent of the state's parishes, are in poorer health than residents living in the urban areas of the state and lack adequate public transportation.

            (3) Small rural hospitals are in poor financial condition as a result of payment reductions in the Medicare and Medicaid programs and as a result of the advent and penetration of managed care in the state.

            (4) Small rural hospitals have a difficult time attracting physicians to practice in their service areas, thereby resulting in a continued shortage of primary health care in the state's rural areas.

            (5) Absent intervention, continued reductions in the Medicare and Medicaid programs, as well as changes in healthcare reimbursement methodologies and the continued spread of managed care, have caused and will continue to cause the closure of many of the state's small rural hospitals, thereby jeopardizing the very existence of a vital link in the healthcare delivery system for residents residing in rural areas of the state.

            (6) Rural hospitals constitute, in many instances, the largest single employer of residents in areas served by them and thus constitute a vital economic component of many rural parish economies.

            (7) The enactment of the Rural Hospital Preservation Act has preserved Louisiana's rural hospitals, a key component of the state's healthcare safety net which is essential to ensuring access to healthcare for Louisiana's rural residents.

            (8) The Rural Hospital Preservation Act requires the department to maximize Medicaid reimbursement, including disproportionate share reimbursement, to rural hospitals.

            (9) Congress has established a federal cap on each state's allotment of Medicaid disproportionate share reimbursement, and Louisiana's disproportionate share expenditures are approaching the federal cap.

            (10) Unreimbursed rural hospital Medicaid inpatient and outpatient costs, including the costs associated with the services provided at rural health clinics that are licensed as part of a rural hospital, are currently eligible for reimbursement under Louisiana's Medicaid disproportionate share program.

            (11) There is no federal cap on Medicaid reimbursement unrelated to the disproportionate share program.

            (12) It is in the state's interest to reduce rural hospital dependence on Medicaid disproportionate share reimbursement by increasing Medicaid reimbursement for rural hospital inpatient and outpatient services, including costs associated with services provided at rural health clinics that are licensed as part of a rural hospital.

            (13) Increasing rural hospital inpatient and outpatient reimbursement under Medicaid will increase the disproportionate share hospital funding available to the state for non-rural, hospital-related disproportionate share hospital payments, thereby permitting the state to meet additional hospital-related uncompensated care needs.

            B. The legislature hereby declares that, absent the enactment of the following provisions, the very existence of Louisiana's small rural hospital is imperiled. The legislature hereby declares that the purpose of this Part is to assure the continued viability of rural hospitals.

            Acts 1997, No. 1485, §1; Acts 2007, No. 327, §1, eff. July 9, 2007; Redesignated from R.S. 40:1300.142 by HCR 84 of 2015 R.S; Acts 2018, No. 206, §4.