SENATE, No. 264

SECTION 1. Patient Safety Technology Trust Fund

(a)    To provide for a grant program to promote health care quality and safety through the use of new health information technology, to provide for certain other activities and projects and to meet certain requirements of law, the sums set forth in subsection (b)  are hereby appropriated from the General Fund for the several purposes and subject to the conditions specified therein, and subject to the provisions of law regulating the disbursement of public funds; provided, that notwithstanding the provisions of any general or special law to the contrary, the appropriations made in this Section shall expire no later than five years after passage of this act, unless otherwise extended by law.

(b)    Division of Health Care Finance and Policy

xxxx-xxxx        For the Patient Safety Technology Trust Fund established under section __ of chapter 118G of the General Laws ….. $750,000,000

SECTION 2. Chapter 118G of the General Laws is hereby amended by adding the following section:

SECTION __.  (a) There shall be established and set up on the books of the commonwealth a separate fund, to be known as the Patient Safety Technology Trust Fund, which shall be administered by the division. Said fund shall consist of funds from the following 3 sources, in equal determinations of liability from each source, annually for the duration of the fund: (1) $50,000,000 to be transferred from the General Fund, as appropriated by the general court; (2) $50,000,000 in revenues to be generated from a surcharge assessed on hospitals licensed by the Department of Public Health; and (3) $50,000,000 in revenues to be generated from a surcharge assessed on all private health care claims paid by a health care insurer licensed by the Division of Insurance, including but not limited to those licensed under chapters 175, 176A, 176B, 176G, and 176I.  For the purposes of this section, the term “health care insurer” shall also include an organization that contracts with said insurer as defined above and is authorized to act as the person’s subcontractor or otherwise administer on behalf of such person, in whole or in part, the services or benefits that are made available to such person’s policyholders, whether under such person’s insurance policy or insurance contract, or by a separate policy or contract issued by the organization in its capacity as subcontractor or otherwise on behalf of such person.  There shall be credited to the fund any income derived from the investment of amounts credited to the fund, and from any royalties generated as a result of any awards of monies from the fund.  All such amounts credited to the fund shall be held in trust and used solely for activities and expenditures consistent with the public purpose of the fund as set forth in subsection (e) of this section; provided, however, that any monies that remain in the fund on the fifth anniversary of the enactment of this act and which have not been committed on a binding basis for expenditure, as well as any amounts that are received by the corporation after such anniversary date and that otherwise would have been credited to the fund pursuant to this subsection, shall be returned promptly to the from the general fund.

(b) A hospital's liability to the fund under subsection (2) of this section shall equal the product of (1) the ratio of its private sector charges to all acute hospitals' private sector charges; and (2) the private sector liability to the uncompensated care pool as determined by law less the surcharge payors' liability established pursuant to section 18A. Before October 1 of each year, the division shall establish each hospital's surcharge liability to the fund as determined by the division. The division shall specify by regulation an appropriate mechanism for interim determination and payment of a hospital's liability to said fund.

(c) A hospital's liability to said fund shall in the case of a transfer of ownership be assumed by the successor in interest to the hospital.

(d) The surcharge liability under subsection (3) of this section shall equal the product of (i) the revenue received surcharge percentage and (ii) the amount paid on health insurance claims by a surcharge payer.  The division shall calculate the surcharge percentage by dividing $50,000,000 by projected annual aggregate claim payments subject to this surcharge.  The division shall establish by regulation a mechanism for enforcing a surcharge payer’s liability to said fund in the event the payer does not make a scheduled payment to said fund.  The division shall further be authorized to seek additional revenue from public and private sources as appropriations, gifts, grants, donations, and from the federal government as reimbursements, grants-in-aid or other receipts to further the purposes of said fund, and any interest or investment earnings on such revenues.  All revenues credited to said fund under this section shall remain in said fund and shall be expended, without further appropriation.

(e) Said fund shall be expended only for the following purposes: purchasing and installing computerized physician order entry systems in eligible hospitals and physician offices, purchasing and installing systems for the establishment of statewide universal electronic medical records and patient health records, and other patient safety technology as recommended by the Health Care Quality and Cost Council.

(f) Disbursement of funds shall be achieved through a separate Request for Application issued to hospitals and physicians participating in the MassHealth program.  Said Request for Application shall provide a process by which hospitals and physicians will receive payments to purchase and install eligible technology systems in a manner consistent with the proposed funding and reimbursement model contained in the Massachusetts Technology Collaborative report entitled “Treatment Plan: High Tech Transfusion, a Case Statement for Implementation of computer physician order entry systems in all Massachusetts Inpatient Hospitals.”  Disbursement of funds shall be made on an impartial and equitable basis, taking into account prior investments by applicants in such technology, and continuing need for additional investment, as determined by the division. The division shall take any appropriate action to obtain the maximum amount of federal financial participation available for amounts paid to hospitals pursuant to this section.  All federal reimbursements received by the commonwealth for expenditures made from the fund shall be deposited into this fund. 

(g) The Massachusetts Health and Educational Facilities Authority is hereby directed and authorized to develop statewide financing programs for eligible patient safety technology acquisition, use of any funding so generated shall be contingent on hospital and physician capital investment and purchase of systems meeting the criteria provided for under the Massachusetts Technology Collaborative report entitled “Treatment Plan: High Tech Transfusion, a Case Statement for Implementation of computer physician order entry systems in all Massachusetts Inpatient Hospitals.”

(h) The division is hereby authorized to convene an advisory committee of interested stakeholders, including but not limited to the Massachusetts Hospital Association, the Massachusetts Technology Collaborative, the Institute for Healthcare Improvement, Blue Cross Blue Cross Blue Shield of Massachusetts Foundation, the Coalition for the Prevention of Medical Errors, and other interested parties as determined by the division.  Said committee shall study and develop recommendations to reduce the administrative burden placed on health care providers through use of new technology that enhances the efficient and economical delivery of patient care. 

SECTION 3. This act shall take effect upon its passage.