Md. Code Regs. 10.37.12.02

Current through Register Vol. 51, No. 25, December 13, 2024

Section 10.37.12.02 - Hospital Charges to Purchasers or Classes of Purchasers

A. In order to assure purchasers of health care hospital services that rates are set equitably among all purchasers of services without undue discrimination, a hospital may not intentionally or otherwise engage in cross-subsidization without approval by the Commission. A hospital may grant a discount only as provided for in COMAR 10.37.10.26N.

B. Without the prior approval of the Commission, neither a hospital, a related entity, nor any entity or person acting on behalf of or in concert with a hospital shall enter into a fixed-price contract, or knowingly participate in or receive the benefit of any arrangement, directly or indirectly, pertaining to the delivery of hospital services. A hospital that has knowledge of such an arrangement shall promptly notify the Commission in accordance with this section in order that the Commission may determine whether the arrangement constitutes an unapproved discount. In order to obtain prior approval of the Commission, the hospital shall file a written application in accordance with COMAR 10.37.10.06N. he filing of this application constitutes the filing of a required report under Commission law and regulation. Failure to file an application before the date on which a fixed-price contract is entered into, or the hospital or related entity knowingly participates in or receives benefit of such an arrangement, may subject the organization or organizations to fines up to $1,000 per day for each day the arrangement exists without prior approval.

C. Factors to Consider When Reviewing a Proposed Arrangement.

(1) In reviewing a proposed arrangement under this regulation, the Commission shall consider the following factors:

(a) Whether the hospital is charging Commission-approved rates and whether payment for hospital services provided is made on the basis of Commission-approved rates;

(b) Whether any proposed deviation from Commission-approved rates is cost justified and does not result in any form of cross-subsidization;

(c) Whether payment at Commission-approved rates is made by an entity not related to the hospital;

(d) The term of the agreement and the termination provisions;

(e) The items or services to be furnished under the proposed agreement, including but not limited to hospital services, and the methodology for computing the payment for these services; and

(f) The proposed sources of funding for the arrangement, including the source of funds to cover any anticipated or unexpected losses under the arrangement.

(2) An agreement may not be reviewed for reasonableness unless the agreement is reduced to writing and specifies in advance the items or services to be furnished as well as the fixed price or methodology used to compute payment.

(3) The risk of substantial loss associated with any arrangement may not be borne by the hospital, either directly or indirectly.

D. For a period beginning with the effective date of this regulation and for a period of 6 months after that, the Commission shall offer an amnesty period. Any hospital which brings to the Commission's attention within the 6-month amnesty period any arrangement to which it is, directly or indirectly, a party shall have any price or compliance penalties which might otherwise have been imposed against it in connection with the arrangement, as set forth in Regulation .03 of this chapter, waived. The waiver shall expire at the later of the end of the 6-month amnesty period or the consideration of the Commission of the approval of the arrangement.

Md. Code Regs. 10.37.12.02

Regulations .02 adopted effective February 17, 1992 (19:3 Md. R. 305)
Regulation .02 amended effective June 7, 1993 (20:11 Md. R. 913); December 2, 1996 (23:24 Md. R. 1683)
Regulation .02B amended effective March 10, 1997 (24:5 Md. R. 412); July 28, 1997 (24:15 Md. R. 1062); March 4, 2013 (40:4 Md. R. 347)