RURAL HOSPITAL ACCESS PAYMENTS S.B. 701:
SUMMARY OF INTRODUCED BILL
IN COMMITTEE
Senate Bill 701 (as introduced 2-1-24)
Sponsor: Senator Sam Singh
Committee: Appropriations (discharged)
CONTENT
The bill would amend the Social Welfare Act to remove the definition of "critical access hospital" and would modify the definition of "rural hospital" as it pertains to the distribution of funds to a rural hospital access pool.
Under current law, a "critical access hospital" means a hospital designated and certified as such under 42 CFR 485.606. (Under that Federal regulation, at a minimum, a critical access hospital must have fewer than 25 inpatient beds, be located more than 35 miles from a hospital or another critical access hospital (or a 15-mile drive if only secondary roads are available), and designation as a critical access hospital by the Centers for Medicare and Medicaid Services.) The bill would remove this definition and related references.
The definition of a "rural hospital" includes facilities located in counties with populations of 165,000 or less, and in cities, villages, or townships with populations under 15,000 based on the 2010 census. The bill raises the county population limit to 195,000 using the 2020 census, while keeping the city, village, and township population cap unchanged. No county currently eligible under the 165,000-person threshold would lose eligibility. However, three additional counties Livingston, Muskegon, and Saginaw would qualify as having rural hospitals. See Table 1 for population details.
Table 1
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Counties with 2010 Population Greater than 165,000 but Less Than 195,000 2020 Population |
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Counties |
2010 Population |
2020 Population |
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Saginaw County |
200,169 |
193,866 |
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Livingston County |
180,967 |
193,866 |
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Muskegon County |
172,188 |
175,824 |
The bill would make 71 locations in the three additional counties qualify as sites for a "rural hospital" (see Table 2 for details). Also, the City of Owosso in Shiawassee County, an already eligible county, would qualify under the proposed definition. However, two locations in currently eligible counties would lose eligibility: Traverse City in Grand Traverse County and DeWitt Charter Township in Clinton County. Population changes are detailed in Table 3.
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Table 2 |
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List of Locations Eligible for Rural Hospital Definition under Senate Bill 701 |
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Ineligible under Current Law, Eligible under Proposed Bill |
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City, Village, Township |
County |
2010 Population |
2020 Population |
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City of Owosso |
Shiawassee County |
15,194 |
14,714 |
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Oceola Township |
Livingston County |
11,936 |
14,623 |
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Tyrone Township |
Livingston County |
10,020 |
11,986 |
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Marion Township |
Livingston County |
9,996 |
11,245 |
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City of Howell |
Livingston County |
9,489 |
10,068 |
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Handy Township |
Livingston County |
8,006 |
8,602 |
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Howell Township |
Livingston County |
6,702 |
7,893 |
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Putnam Township |
Livingston County |
8,248 |
7,890 |
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City of Brighton |
Livingston County |
7,444 |
7,446 |
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Deerfield Township |
Livingston County |
4,170 |
4,166 |
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Iosco Township |
Livingston County |
3,801 |
3,870 |
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Conway Township |
Livingston County |
3,546 |
3,608 |
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Unadilla Township |
Livingston County |
3,366 |
3,333 |
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Cohoctah Township |
Livingston County |
3,317 |
3,246 |
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Village of Fowlerville |
Livingston County |
2,886 |
2,951 |
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Village of Pinckney |
Livingston County |
2,427 |
2,415 |
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Fruitport Charter Township |
Muskegon County |
13,598 |
14,575 |
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Egelston Township |
Muskegon County |
9,909 |
11,128 |
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Village of Muskegon Heights |
Muskegon County |
10,856 |
9,917 |
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Dalton Township |
Muskegon County |
9,300 |
9,427 |
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Laketon Township |
Muskegon County |
7,563 |
7,626 |
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Fruitland Township |
Muskegon County |
5,543 |
5,793 |
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City of Roosevelt Park |
Muskegon County |
3,831 |
4,172 |
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City of North Muskegon |
Muskegon County |
3,786 |
4,093 |
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Cedar Creek Township |
Muskegon County |
3,186 |
3,192 |
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Ravenna Township |
Muskegon County |
2,905 |
2,962 |
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City of Whitehall |
Muskegon County |
2,706 |
2,909 |
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Casnovia Township |
Muskegon County |
2,805 |
2,793 |
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Holton Township |
Muskegon County |
2,515 |
2,586 |
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Sullivan Township |
Muskegon County |
2,441 |
2,541 |
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City of Montague |
Muskegon County |
2,361 |
2,417 |
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Blue Lake Township |
Muskegon County |
2,399 |
2,416 |
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Whitehall Township |
Muskegon County |
1,739 |
1,768 |
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Moorland Township |
Muskegon County |
1,575 |
1,627 |
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Montague Township |
Muskegon County |
1,600 |
1,555 |
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White River Township |
Muskegon County |
1,335 |
1,383 |
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Village of Lakewood Club |
Muskegon County |
1,291 |
1,340 |
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Village of Ravenna |
Muskegon County |
1,219 |
1,308 |
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Village of Fruitport |
Muskegon County |
1,093 |
1,103 |
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Thomas Township |
Saginaw County |
11,985 |
11,931 |
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Tittabawassee Township |
Saginaw County |
9,726 |
10,606 |
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Bridgeport Charter Township |
Saginaw County |
10,514 |
10,104 |
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Buena Vista Charter Township |
Saginaw County |
8,676 |
7,664 |
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Birch Run Township |
Saginaw County |
6,033 |
5,888 |
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Carrollton Township |
Saginaw County |
6,103 |
5,750 |
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City of Frankenmuth |
Saginaw County |
4,944 |
4,987 |
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Kochville Township |
Saginaw County |
5,078 |
4,911 |
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Chesaning Township |
Saginaw County |
4,659 |
4,748 |
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Taymouth Township |
Saginaw County |
4,520 |
4,065 |
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Richland Township |
Saginaw County |
4,144 |
3,955 |
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St. Charles Township |
Saginaw County |
3,330 |
3,183 |
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Maple Grove Township |
Saginaw County |
2,668 |
2,676 |
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Village of Chesaning |
Saginaw County |
2,394 |
2,430 |
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Swan Creek Township |
Saginaw County |
2,456 |
2,416 |
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Brady Township |
Saginaw County |
2,218 |
2,142 |
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Albee Township |
Saginaw County |
2,160 |
2,046 |
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Fremont Township |
Saginaw County |
2,096 |
1,998 |
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Village of St. Charles |
Saginaw County |
2,054 |
1,992 |
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Spaulding Township |
Saginaw County |
2,153 |
1,975 |
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Frankenmuth Township |
Saginaw County |
1,959 |
1,895 |
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Blumfield Township |
Saginaw County |
1,960 |
1,874 |
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Brant Township |
Saginaw County |
2,012 |
1,842 |
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James Township |
Saginaw County |
2,023 |
1,792 |
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Jonesfield Township |
Saginaw County |
1,667 |
1,618 |
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City of Zilwaukee |
Saginaw County |
1,658 |
1,534 |
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Village of Birch Run |
Saginaw County |
1,555 |
1,525 |
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Chapin Township |
Saginaw County |
1,060 |
928 |
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Lakefield Township |
Saginaw County |
1,029 |
894 |
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Marion Township |
Saginaw County |
923 |
759 |
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Village of Merrill |
Saginaw County |
778 |
663 |
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Village of Oakley |
Saginaw County |
290 |
299 |
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Zilwaukee Township |
Saginaw County |
67 |
62 |
Table 3
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List of Locations Ineligible for Rural Hospital Definition under Senate Bill 701 |
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Eligible under Current Law, Ineligible under Proposed Bill |
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City, Village, Township |
County |
2010 Population |
2020 Population |
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DeWitt Charter Township |
Clinton County |
14,321 |
15,073 |
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City of Traverse City |
Grand Traverse County |
14,482 |
15,341 |
FISCAL IMPACT
There bill would have no direct fiscal impact on State government and no fiscal impact on local units of government. Current law sets a floor of $26.0 million General Fund/General Purpose (GF/GP) appropriations for the rural hospital access pool. Of this, $8.0 million is allocated to sole community hospitals and rural hospitals providing obstetrical care to Medicaid beneficiaries, with the remainder distributed to reimburse unreimbursed Medicaid costs for sole community, critical access, and rural hospitals. Any remaining funds are allocated based on Medicaid managed care outpatient payments. The bill would direct $8.4 million to sole community hospitals and rural hospitals providing obstetrical care to Medicaid beneficiaries.
The total authority for expenditures is provided in the annual appropriations acts, so even with recognition of the $26.0 million requirement in current law and the proposed increase of obstetric allocation from $8.0 million to $8.4 million, any fiscal impact on State government would require an appropriation. While the bill itself would not create a fiscal change, removing critical access hospitals from the distribution formula could increase allocations to sole community and rural hospitals. Fiscal impacts would depend on future appropriations. Table 4 provides a historical overview of General Fund appropriations for the rural obstetrical and access pools.
Table 4
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Fiscal Year (FY) 2017-18 through FY 2024-25 Rural Hospital Access Pool Appropriations |
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Fiscal Year |
Rural Hospital Obstetrical GF/GP Appropriations |
Rural Pool GF/GP Appropriations |
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2017-18 |
$3,978,300 |
$12,000,000 |
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2018-19 |
7,978,300 |
18,000,000 |
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2019-20 |
7,995,200 |
13,904,800 |
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2020-21 |
7,995,200 |
13,904,800 |
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2021-22 |
7,995,200 |
13,904,800 |
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2022-23 |
7,995,200 |
13,904,800 |
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2023-24 |
7,995,200 |
15,204,800 |
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2024-25* |
8,470,200 |
15,204,800 |
*Included in Public Act 121 of 2024 (Initial appropriations)
Fiscal Analyst: John P. Maxwell
This analysis was prepared by nonpartisan Senate staff for use by the Senate in its deliberations and does not constitute an official statement of legislative intent.