Letter to Administrator/Controller regarding New York State Hospital Quality Contribution

June 24, 2011

Dear Administrator/Controller:

This letter provides notice of statutory changes that established the New York State Hospital Quality Initiative as part of the enacted 2011-2012 State Fiscal Year Budget.

Section 2807-d-1 of the Public Health Law was established to create the Hospital Quality Contribution (HQC) for all Article 28 general hospitals. This program was designed to collect $30 million dollars for the state fiscal year April 1, 2011 through March 31, 2012 by applying an assessment on inpatient obstetrical patient care service revenues. Since the effective date of the assessment is July 1, 2011 an initial rate of 2.4% had to be implemented instead of the anticipated 1.6% in order to achieve the required $30M in state fiscal year collections. Please note that statute provides the Department with the authority to adjust the assessment rate to ensure the collection of such annual quality contributions.

The 2.4% assessment will be imposed on cash received for inpatient obstetrical patient care services for periods on or after July 1, 2011. For the purpose of the HQC, the definition of inpatient obstetrical patient care services will include labor and delivery services, care resulting from complications related to a pregnancy, immediate postpartum/postnatal care until discharge and services related to the care of normal newborns (APR-DRG 640 or its equivalent under comparable classification systems).

A new reporting schedule will be included as part of the monthly Health Facility Cash Assessment Program report, and will be available by August 1, 2011 at www.hcrapools.org. The first monthly HQC reporting will be due on August 15, 2011. The same user ID and password will be used for both the HQC and the HFCAP report. The Department will send more information and detailed instructions for the electronic report in the near future.

If you should have any other questions, please contact Ms. Megan Ryan at DOH at (518) 474-1673.


John E. Ulberg, Jr.
Division of Health Care Financing