Bill
SB 3754
The bill extends and expands Medicaid add-ons for safety-net hospitals, removing sunset dates and boosting inpatient payments (MIUR-based equity and low-volume) plus new per-diem a
Title: MEDICAID-SNF-MIUR/LOW VOL EXT
Jurisdiction: Illinois
Introduced: February 5, 2026
Prime Sponsor: Sen. Graciela Guzmán
Co-Sponsor: Graciela Guzmán
Effective Date: Upon becoming law
Purpose and intent
- The bill amends the Illinois Public Aid Code to modify and extend certain add-on payments and rate adjustments for safety-net hospitals (including safety-net hospitals’ general inpatient, psychiatric, and related services) that are paid through the Medicaid program.
- Specifically, it removes the sunset dates for existing add-on payments and introduces new or adjusted add-ons related to safety-net hospitals’ Medicaid inpatient utilization and low-volume status.
Key provisions and changes
1) Add-on payments to safety-net hospitals (sunset removal and continued support)
- Adds/remains in effect two primary add-ons for inpatient care at safety-net hospitals:
- Health care equity add-on (based on Medicaid inpatient utilization rate, MIUR)
- Low-volume add-on ($200 per inpatient General Acute and Psychiatric day of care)
- The bill removes the sunset dates (previously set to December 31, 2026) for these add-ons, making them ongoing effective dates that align with 2024-2026 changes.
2) Hospital rate updates and 2024-2026 adjustments (Section 14-12.5 updates)
- Adjusts multiple hospital payment components for dates of service on/after January 1, 2024 (subject to federal approval). Main adjustments include:
- Inpatient general acute care: statewide-standardized amount and APR-DRG-exempt per diem rates increased by 10% (as of January 1, 2023 baselines).
- Inpatient psychiatric services:
- Safety-net hospitals: per diem rate (from January 1, 2023) and the minimum per diem of $630 raised by 10%.
- Non-safety-net general acute care hospitals: psychiatric per diem rates increased by 10% with a floor at 90% of the safety-net minimum.
- Safety-net and non-safety-net per diem rate structures for new psychiatric units and psychiatric specialty hospitals are aligned with adjusted minimums (with 90% benchmarks).
- Inpatient rehabilitative services: per diem rates for all hospital-specific rates increased by 10%; statewide defaults for general acute care and rehabilitation hospitals increased by 10%.
- Outpatient general acute, outpatient psychiatric, and outpatient rehabilitative care: statewide-standardized amounts increased by 10%.
- Inpatient per diem rate (general) from January 1, 2023: increased by 10%.
3) Add-ons for inpatient care (new/adjusted add-ons)
- Add-on for each inpatient General Acute and Psychiatric day (for safety-net hospitals, dates 2024-2026, subject to federal approval):
- A $210 add-on (or alternative to increase the psychiatric per diem by $210) to be used to operationalize the add-on.
- If added to the psychiatric per diem rate, a rate sheet must be provided to each safety-net hospital showing pre- and post-adjustment rates.
- This add-on must be separate from the 90% minimum rate established in the psychiatric per diem framework.
- Safety-net hospital health care equity add-on (for 2024-2026), scaled by Medicaid inpatient utilization rate:
- 70%+ MIUR: $425 per inpatient day
- 50-69% MIUR: $300 per inpatient day
- 40-49% MIUR: $225 per inpatient day
- <40% MIUR: $210 per inpatient day
- Qualification for the add-on updated January 1, 2026 (based on MIUR determinations three months before start of 2026 calendar year)
- Annual adjustment starting January 1, 2026 to distribute approximately $50 million per year, using a uniform factor based on State Fiscal Year 2024 days as a basis for 2026 rates
- These add-ons are not counted toward the 90% minimum rate in subsection (b)(2)(B)
4) Administrative and implementation requirements
- Department of Healthcare and Family Services (HFS) must:
- Implement changes compatible with Public Act 103-102 and this amendatory act (ensuring dates of service and rate changes are in effect after compliance and federal approval).
- Publish updated rate sheets or add-on payment amounts at least 30 days before the effective date or within 30 days after federal CMS approval (whichever is later).
- Apply for federal approval to amend Illinois Title XIX State Plan as needed.
- Consider emergency rulemaking to implement these changes, with the Illinois Administrative Procedure Act provisions allowing emergency rulemaking without the usual 24-month limit for emergency rules.
- Managed care adjustments: HFS must adjust MCO capitation base rates accordingly, with publication and application 90 days before the effective date of changes.
Affected parties and fiscal impact
- Safety-net hospitals (as defined in the statute) receive enhanced payments via:
- Health care equity add-on (MIUR-based)
- Low-volume add-on
- Optional per-diem or separate add-on payments for psychiatric days
- Medically underserved populations relying on Medicaid hospital services may benefit through higher reimbursement rates and improved hospital capacity in safety-net facilities.
- Hospitals not categorized as safety-net may still see rate adjustments (10% increases in several inpatient and outpatient categories) but have minimum floor protections to ensure comparability with safety-net rates.
- The bill contemplates a roughly $50 million annual targeting for the equity add-on, distributed via a uniform adjustment starting 2026.
Note: The bill emphasizes compliance with federal approval and rulemaking processes, and it extends certain add-on payments beyond previous sunset dates.
Compiled from official sources — confirm details with the bill’s official record.
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