Chapter 736 Oregon Laws 2003

 

AN ACT

 

HB 2747

 

Relating to taxation; creating new provisions; amending sections 4, 5 and 31, chapter 709, Oregon Laws 2003 (Enrolled House Bill 2152); repealing sections 72, 73, 74, 75, 76, 77, 78, 79, 80, 81, 82, 83, 84, 85, 86, 87, 88, 89, 90, 91, 92, 93, 94, 95, 96, 97, 98, 99, 100, 101, 102, 103, 104, 105, 106, 107, 108 and 109, chapter 709, Oregon Laws 2003 (Enrolled House Bill 2152); appropriating money; prescribing an effective date; and providing for revenue raising that requires approval by a three-fifths majority.

 

HOSPITAL TAXES

 

Be It Enacted by the People of the State of Oregon:

 

          SECTION 1. As used in sections 1 to 9 of this 2003 Act:

          (1) “Charity care” means costs for providing inpatient or outpatient care services free of charge or at a reduced charge because of the indigence or lack of health insurance of the patient receiving the care services.

          (2) “Contractual adjustments” means the difference between the amounts charged based on the hospital’s full established charges and the amount received or due from the payor.

          (3) “Hospital” has the meaning given that term in ORS 442.015 but does not include special inpatient care facilities.

          (4) “Net revenue”:

          (a) Means the total amount of charges for inpatient or outpatient care provided by the hospital to patients, less charity care, bad debts and contractual adjustments;

          (b) Does not include revenue derived from sources other than inpatient or outpatient operations, including but not limited to interest and guest meals; and

          (c) Does not include any revenue that is taken into account in computing a long term care facility assessment under sections 15 to 22 of this 2003 Act.

          (5) “Waivered hospital” means a type A or type B hospital, as described in ORS 442.470, a hospital that provides only psychiatric care or a hospital identified by the Department of Human Services as appropriate for inclusion in the application described in section 4 of this 2003 Act.

 

          SECTION 2. (1) An assessment is imposed on each hospital in this state that is not a waivered hospital. The assessment shall be imposed at a rate determined by the Director of Human Services by rule that is the director’s best estimate of the rate needed to fund the services and costs identified in section 9 of this 2003 Act. The rate of assessment shall be imposed on the net revenue of each hospital subject to assessment. The director shall consult with representatives of hospitals before setting the assessment.

          (2) Notwithstanding subsection (1) of this section, the rate of assessment may not exceed three percent.

          (3) The assessment shall be reported on a form prescribed by the Department of Human Services and shall contain the information required to be reported by the department. The assessment form shall be filed with the department on or before the 75th day following the end of the calendar quarter for which the assessment is being reported. The hospital shall pay the assessment at the time the hospital files the assessment report. The payment shall accompany the report.

          (4) A hospital is not guaranteed that any additional moneys paid to the hospital in the form of payments for services shall equal or exceed the amount of the assessment paid by the hospital.

          (5) Hospitals operated by the United States Department of Veterans Affairs and pediatric specialty hospitals providing care to children at no charge are exempt from the assessment imposed under this section.

 

          SECTION 3. Notwithstanding section 2 of this 2003 Act, the Director of Human Services shall reduce the rate of assessment imposed under section 2 of this 2003 Act to the maximum rate allowed under federal law if the reduction is required to comply with federal law.

 

          SECTION 4. (1) On or before January 1, 2004, the Department of Human Services shall submit an application to the Centers for Medicare and Medicaid Services to request a waiver of the broad-based tax requirement pursuant to 42 C.F.R. 433.68(e) to exempt waivered facilities from the assessment imposed under section 2 of this 2003 Act. The department shall ensure that the application requesting a waiver meets the requirements of 42 C.F.R. 433.68(e)(1).

          (2) The Director of Human Services may include in the application requesting a waiver any hospital operated exclusively for a prepaid group practice health plan that serves at least 200,000 members in this state and that has been issued a certificate of authority by the Department of Consumer and Business Services as a health care service contractor if the application requesting a waiver meets the requirements of 42 C.F.R. 433.68(e)(1).

          (3) The department shall notify waivered facilities that the department has submitted the application to the Centers for Medicare and Medicaid Services to request a waiver of the broad-based tax requirement pursuant to 42 C.F.R. 433.68(e) to exempt waivered facilities from the assessment imposed under section 2 of this 2003 Act.

          (4) If an application to the Centers for Medicare and Medicaid Services for a waiver of the broad-based tax requirement pursuant to 42 C.F.R. 433.68(e) is denied, the Director of Human Services may resubmit the application with appropriate changes to receive a waiver of the broad-based tax requirement.

 

          SECTION 5. (1) A hospital that fails to file a report or pay an assessment under section 2 of this 2003 Act by the date the report or payment is due shall be subject to a penalty of $500 per day of delinquency. The total amount of penalties imposed under this section for each reporting period may not exceed five percent of the assessment for the reporting period for which penalties are being imposed.

          (2) Penalties imposed under this section shall be collected by the Department of Human Services and deposited in the Department of Human Services Account established under ORS 409.060.

          (3) Penalties paid under this section are in addition to and not in lieu of the assessment imposed under section 2 of this 2003 Act.

 

          SECTION 6. (1) Any hospital that has paid an amount that is not required under sections 1 to 9 of this 2003 Act may file a claim for refund with the Department of Human Services.

          (2) Any hospital that is aggrieved by an action of the Department of Human Services or by an action of the Director of Human Services taken pursuant to subsection (1) of this section shall be entitled to notice and an opportunity for a contested case hearing under ORS 183.310 to 183.550.

 

          SECTION 7. The Department of Human Services may audit the records of any hospital in this state to determine compliance with sections 1 to 9 of this 2003 Act. The department may audit records at any time for a period of five years following the date an assessment is due to be reported and paid under section 2 of this 2003 Act.

 

          SECTION 8. Amounts collected by the Department of Human Services from the assessments imposed under section 2 of this 2003 Act shall be deposited in a suspense account established under ORS 293.445. Amounts necessary to pay refunds are continuously appropriated to the department from the suspense account. After the payment of refunds, the net amount of revenue shall be transferred to the Hospital Quality Assurance Fund established under section 9 of this 2003 Act.

 

          SECTION 9. (1) The Hospital Quality Assurance Fund is established in the State Treasury, separate and distinct from the General Fund. Interest earned by the Hospital Quality Assurance Fund shall be credited to the Hospital Quality Assurance Fund.

          (2) Amounts in the Hospital Quality Assurance Fund are continuously appropriated to the Department of Human Services for the purpose of funding health services under ORS 414.705 to 414.750, including but not limited to:

          (a) Increasing reimbursement rates for inpatient and outpatient hospital services under ORS 414.705 to 414.750;

          (b) Expanding, continuing or modifying hospital services for persons 19 years of age or older with incomes below 100 percent of the federal poverty guidelines who do not have federal Medicare coverage under ORS 414.705 to 414.750; and

          (c) Administrative costs incurred by the department to administer the assessments imposed under section 2 of this 2003 Act.

 

          SECTION 10. Sections 1 to 9 of this 2003 Act apply to net revenues earned by hospitals on or after January 1, 2004, and before January 1, 2008.

 

          SECTION 11. (1) Sections 1 to 9 of this 2003 Act become operative on the day after the date of receipt of all necessary federal approvals, including the waiver of the broad-based tax requirement pursuant to 42 C.F.R. 433.68(e), by the Centers for Medicare and Medicaid Services.

          (2) The Director of Human Services shall notify the Legislative Counsel upon receipt of the necessary federal approvals or denial of the federal approvals.

 

          SECTION 12. Sections 1 to 9 of this 2003 Act are repealed on January 2, 2010.

 

          SECTION 13. Nothing in the repeal of sections 1 to 9 of this 2003 Act by section 12 of this 2003 Act affects the imposition and collection of a hospital assessment under sections 1 to 9 of this 2003 Act for a calendar quarter beginning before January 1, 2008.

 

          SECTION 14. Any moneys remaining in the Hospital Quality Assurance Fund on December 31, 2009, are transferred to the General Fund.

 

LONG TERM CARE FACILITY TAXES

 

          SECTION 15. As used in sections 15 to 22 of this 2003 Act:

          (1) “Assessment rate” means the rate established by the Director of Human Services under section 17 of this 2003 Act.

          (2) “Gross revenue”:

          (a) Means the revenue paid to a long term care facility for patient care, room, board and services, less contractual adjustments; and

          (b) Does not include revenue derived from sources other than operations, including but not limited to interest and guest meals.

          (3) “Long term care facility” has the meaning given that term in ORS 442.015, but does not include an intermediate care facility for the mentally retarded.

          (4) “Patient days” means the total number of patients occupying beds in a long term care facility, determined as of 12:01 a.m. of each day, for all days in the calendar period for which an assessment is being reported and paid. For purposes of this subsection, if a long term care facility patient is admitted and discharged on the same day, the patient shall be deemed present on 12:01 a.m. of that day.

 

          SECTION 16. (1) A long term care facility assessment is imposed on each long term care facility in this state.

          (2) The amount of the assessment equals the assessment rate times the number of patient days at the long term care facility for a calendar quarter.

          (3) The assessment shall be reported on a form prescribed by the Department of Human Services and shall contain the information required to be reported by the department. The assessment form shall be filed with the department on or before the 30th day of the month following the end of the calendar quarter for which the assessment is being reported. The long term care facility shall pay the assessment at the time the facility files the assessment report. The payment shall accompany the report.

          (4) A long term care facility is not guaranteed that any additional moneys paid to the facility in the form of reimbursements calculated according to the methodology described in section 24 (4) of this 2003 Act shall equal or exceed the amount of the long term care facility assessment paid by the facility.

 

          SECTION 17. (1) The Director of Human Services shall establish an annual assessment rate for long term care facilities that applies for a 12-month period beginning July 1. The assessment rate shall be a rate that will raise an amount equal to six percent of the annual gross revenue of all long term care facilities in this state, excluding the annual gross revenue of long term care facilities that are exempt from the assessment under section 16 of this 2003 Act, for the 12-month period beginning July 1 preceding the 12-month period for which the assessment is being imposed.

          (2) At the time the annual assessment rate is established, the director may adjust the assessment rate determined under subsection (1) of this section to account for overages and underages in the aggregate amount actually collected during previous assessment periods.

          (3) The director shall establish the assessment rate on or before June 15th preceding the 12-month period for which the rate applies.

 

          SECTION 18. The Oregon Veterans’ Home is exempt from the assessment imposed under section 16 of this 2003 Act.

 

          SECTION 19. (1) A long term care facility that fails to file a report or pay an assessment under section 16 of this 2003 Act by the date the report or payment is due shall be subject to a penalty of $500 per day of delinquency. The total amount of penalties imposed under this section for each reporting period may not exceed five percent of the assessment for the reporting period for which penalties are being imposed.

          (2) Penalties imposed under this section shall be collected by the Department of Human Services and deposited in the Department of Human Services Account established under ORS 409.060.

          (3) Penalties paid under this section are in addition to and not in lieu of the assessment imposed under section 16 of this 2003 Act.

 

          SECTION 20. (1) A long term care facility that has paid an amount that is not required under sections 15 to 22 of this 2003 Act may file a claim for refund with the Department of Human Services.

          (2) Any long term care facility aggrieved by an action of the Department of Human Services or by an action of the Director of Human Services taken under sections 15 to 22 of this 2003 Act shall be entitled to notice and an opportunity for a contested case hearing under ORS 183.310 to 183.550.

 

          SECTION 21. (1) Each long term care facility subject to assessment under section 16 of this 2003 Act shall maintain records sufficient to determine the amount of the assessment under section 16 of this 2003 Act.

          (2) Unless otherwise exempt, a long term care facility shall report the payment of the assessment as an allowable cost for Medicaid reimbursement purposes.

          (3) The Department of Human Services may audit the records of any long term care facility in this state to determine compliance with sections 15 to 22 of this 2003 Act. The department may audit records at any time for a period of three years following the date an assessment is due to be reported and paid under section 16 of this 2003 Act.

 

          SECTION 22. Amounts collected by the Department of Human Services from the assessment under section 16 of this 2003 Act shall be deposited in a suspense account established under ORS 293.445. Amounts necessary to pay refunds are continuously appropriated to the department from the suspense account. After the payment of refunds, the net amount of revenue shall be transferred to the Long Term Care Facility Quality Assurance Fund established under section 24 of this 2003 Act.

 

          SECTION 23. Sections 15 to 22 of this 2003 Act apply to long term care facility assessments imposed in calendar quarters beginning on or after the effective date of this 2003 Act and before July 1, 2007.

 

          SECTION 24. (1) The Long Term Care Facility Quality Assurance Fund is established in the State Treasury, separate and distinct from the General Fund. Interest earned by the Long Term Care Facility Quality Assurance Fund shall be credited to the fund.

          (2) Amounts in the Long Term Care Facility Quality Assurance Fund are continuously appropriated to the Department of Human Services for the purposes of funding long term care facilities, as defined in section 15 of this 2003 Act, that are a part of the Oregon Medicaid reimbursement system.

          (3) Funds in the Long Term Care Facility Quality Assurance Fund and the matching federal financial participation under Title XIX of the Social Security Act may be used to fund Medicaid-certified long term care facilities using only the reimbursement methodology described in subsection (4) of this section to achieve a rate of reimbursement greater than the rate in effect on July 1, 2003.

          (4) The reimbursement methodology used to make additional payments to Medicaid-certified long term care facilities includes but is not limited to:

          (a) Rebasing biennially, beginning on July 1 of each odd-numbered year;

          (b) Adjusting for inflation in the nonrebasing year;

          (c) Continuing the use of the pediatric rate;

          (d) Continuing the use of the complex medical needs additional payment;

          (e) Discontinuing the use of the relationship percentage, except when calculating the pediatric rate in paragraph (c) of this subsection; and

          (f) Requiring the Department of Human Services to reimburse costs at a rate not lower than the 63rd percentile ceiling of allowable costs for the 2003-2005 biennium and the 70th percentile ceiling of allowable costs for the 2005-2007 biennium.

 

          SECTION 25. Notwithstanding section 24 of this 2003 Act:

          (1) On or before March 15, 2004, $6.25 million shall be transferred from the Long Term Care Facility Quality Assurance Fund to the General Fund; and

          (2) On or before March 15, 2005, $6.25 million shall be transferred from the Long Term Care Facility Quality Assurance Fund to the General Fund.

 

          SECTION 26. Notwithstanding ORS 410.555, during the 2003-2005 biennium and the 2005-2007 biennium, the Department of Human Services shall periodically adjust reimbursement rates to reflect the increase between the long term care facility caseload approved and funded in the legislatively adopted budget for the department for the 2003-2005 biennium and the long term care facility caseload at the time of the adjustment.

 

          SECTION 27. (1) Notwithstanding section 17 (1) of this 2003 Act and ORS 410.555, the assessment under section 16 of this 2003 Act for calendar quarters beginning on or after the effective date of this 2003 Act and before July 1, 2004, shall be determined using an assessment rate of $8.25.

          (2) An assessment in a calendar quarter may be adjusted as provided in section 17 (2) of this 2003 Act to take into account overages or underages raised under the assessment rate set under subsection (1) of this section, including but not limited to overages and underages caused by an approval or denial by the Centers for Medicare and Medicaid Services of an application to request a waiver made pursuant to section 33 of this 2003 Act. An adjustment under this subsection may be made at any time.

 

          SECTION 28. (1) Notwithstanding section 23 of this 2003 Act and ORS 410.555, a long term care facility assessment is imposed on long term care facilities for patient days on or after July 1, 2003, and before the first day of the calendar quarter that begins on or after the effective date of this 2003 Act.

          (2) The assessment rate for the period described in subsection (1) of this section is $8.25.

          (3) The assessment shall be computed and reported as described in section 16 of this 2003 Act and shall be paid to the Department of Human Services on or before the 30th day of the first month of the calendar quarter that begins on or after the effective date of this 2003 Act.

          (4) The department shall deposit assessments collected under this section, and penalties associated with those assessments, in the suspense account described in section 22 of this 2003 Act.

          (5) Unless the context requires otherwise, sections 15 to 22 of this 2003 Act apply to the assessments imposed under this section.

 

          SECTION 29. Notwithstanding sections 15 to 22 of this 2003 Act, an assessment under sections 15 to 22 of this 2003 Act may be imposed only in a calendar quarter for which the long term care facility reimbursement rate that is part of the Oregon Medicaid reimbursement system was calculated according to the methodology described in section 24 (4) of this 2003 Act. The department may make retroactive increases in payments for the first six months the assessment is imposed.

 

          SECTION 30. Notwithstanding ORS 410.555 and section 28 of this 2003 Act, an assessment under section 28 of this 2003 Act may be imposed only in a calendar quarter for which the long term care facility reimbursement rate that is part of the Oregon Medicaid reimbursement system was calculated according to the methodology described in section 24 (4) of this 2003 Act.

 

          SECTION 31. Sections 15 to 22 and 24 of this 2003 Act are repealed on January 2, 2008.

 

          SECTION 32. (1) Nothing in the repeal of sections 15 to 22 and 24 of this 2003 Act by section 31 of this 2003 Act affects the imposition and collection of a long term care facility assessment under sections 15 to 22 of this 2003 Act for a calendar quarter beginning before July 1, 2007.

          (2) Any moneys remaining in the Long Term Care Facility Quality Assurance Fund on January 1, 2008, are transferred to the General Fund.

 

          SECTION 33. (1) As used in this section, “waivered long term care facilities” means continuing care retirement communities, as defined in ORS 101.020, long term care facilities that have been identified by the Department of Human Services as having a Medicaid recipient census that exceeds the census level established by the department and the Oregon Veterans’ Home.

          (2) On or before the effective date of this 2003 Act, the department shall submit an application to the Centers for Medicare and Medicaid Services to request a waiver of the broad-based tax requirement pursuant to 42 C.F.R. 433.68(e) to exempt waivered long term care facilities from the long term care facility assessment imposed under section 16 of this 2003 Act. The department shall ensure that the application requesting a waiver meets the requirements of 42 C.F.R. 433.68(e)(1).

          (3) The department shall notify waivered long term care facilities that the department has submitted the application to the Centers for Medicare and Medicaid Services to request a waiver of the broad-based tax requirement pursuant to 42 C.F.R. 433.68(e) to exempt waivered long term care facilities from the long term care facility assessment imposed under section 16 of this 2003 Act. While a decision on an application to request a waiver is pending, the department may extend the period in which a waivered long term care facility is required to file a return and pay a long term care facility assessment. The period of extension may not continue beyond a date that is 90 days following the date of the denial of a waiver by the Centers for Medicare and Medicaid Services.

          (4) If an application to the Centers for Medicare and Medicaid Services for a waiver of the broad-based tax requirement pursuant to 42 C.F.R. 433.68(e) is denied, the Director of Human Services may:

          (a) Resubmit the application with appropriate changes to receive a waiver of the broad-based tax requirements; or

          (b) Submit an application to the Centers for Medicare and Medicaid Services for a waiver of uniform tax requirements pursuant to 42 C.F.R. 433.68(e).

 

          SECTION 34. Section 18 of this 2003 Act is amended to read:

          Sec. 18. (1) The Oregon Veterans’ Home is exempt from the assessment imposed under section 16 of this 2003 Act.

          (2) A waivered long term care facility, as defined in section 33 of this 2003 Act, is exempt from the long term care facility assessment imposed under section 16 of this 2003 Act.

 

          SECTION 35. (1) The amendments to section 18 of this 2003 Act by section 34 of this 2003 Act become operative on the day after the date of receipt of the approval by the Centers for Medicare and Medicaid Services of the waiver of the broad-based tax requirement pursuant to 42 C.F.R. 433.68(e).

          (2) The Director of Human Services shall notify the Legislative Counsel upon receipt of the waiver or denial of the waiver request.

 

          SECTION 36. Section 33 of this 2003 Act is repealed on January 2, 2008.

 

MEDICAID MANAGED CARE TAXES

 

          SECTION 37. As used in sections 37 to 44 of this 2003 Act:

          (1) “Managed care premiums” means premium payments paid to a prepaid managed care health services organization, but does not include Medicare premiums.

          (2) “Prepaid managed care health services organization” or “organization” means a managed health, dental, mental health or chemical dependency organization that contracts with the Department of Human Services on a prepaid capitated basis under ORS 414.725. A prepaid managed care health services organization may be a dental care organization, fully capitated health plan, physician care organization, mental health organization or chemical dependency organization.

 

          SECTION 38. (1) An assessment is imposed on each prepaid managed care health services organization in this state. The assessment shall be imposed at a rate set by the Director of Human Services. The rate may not exceed six percent of managed care premiums paid to an organization.

          (2) The assessment shall be reported on a form prescribed by the Department of Human Services and shall contain the information required to be reported by the department. The assessment form shall be filed with the department on or before the 75th day following the end of the calendar quarter for which the assessment is being reported. The organization shall pay the assessment at the time the organization files the assessment report. The payment shall accompany the report.

          (3) A prepaid managed care health services organization is not guaranteed that any additional moneys paid to the organization shall equal or exceed the amount of the assessment paid by the organization.

 

          SECTION 39. Notwithstanding section 38 of this 2003 Act, the Director of Human Services may reduce the rate of assessment imposed under section 38 of this 2003 Act to the maximum rate allowed under federal law if the reduction is required to comply with federal law.

 

          SECTION 40. (1) A prepaid managed care health services organization that fails to file a report or pay an assessment under section 38 of this 2003 Act by the date the report or payment is due shall be subject to a penalty of $500 per day of delinquency. The total amount of penalties imposed under this section for each reporting period may not exceed five percent of the assessment for the reporting period for which penalties are being imposed.

          (2) Penalties imposed under this section shall be collected by the Department of Human Services and deposited in the Department of Human Services Account established under ORS 409.060.

          (3) Penalties paid under this section are in addition to and not in lieu of the assessment imposed under section 38 of this 2003 Act.

 

          SECTION 41. (1) A prepaid managed care health services organization that has paid an amount that is not required under sections 37 to 44 of this 2003 Act may file a claim for refund with the Department of Human Services.

          (2) Any organization that is aggrieved by an action of the Department of Human Services or by an action of the Director of Human Services taken pursuant to subsection (1) of this section shall be entitled to notice and an opportunity for a contested case hearing under ORS 183.310 to 183.550.

 

          SECTION 42. The Department of Human Services may audit the records of any organization in this state to determine compliance with sections 37 to 44 of this 2003 Act. The department may audit the records at any time for a period of five years following the date an assessment is due to be reported and paid under section 38 of this 2003 Act.

 

          SECTION 43. Amounts collected by the Department of Human Services from the assessments under section 38 of this 2003 Act shall be deposited in a suspense account established under ORS 293.445. Amounts necessary to pay refunds are continuously appropriated to the department from the suspense account. After the payment of refunds, the net amount of revenue shall be transferred to the Medical Care Quality Assurance Fund established under section 44 of this 2003 Act.

 

          SECTION 44. (1) The Medical Care Quality Assurance Fund is established in the State Treasury, separate and distinct from the General Fund. Interest earned by the Medical Care Quality Assurance Fund shall be credited to the Medical Care Quality Assurance Fund.

          (2) Amounts in the Medical Care Quality Assurance Fund are continuously appropriated to the Department of Human Services for the purpose of funding the state medical assistance program, including but not limited to health services provided by prepaid managed care health services organizations.

 

          SECTION 45. Sections 37 to 44 of this 2003 Act apply to managed care premiums received by prepaid managed care health services organizations on or after January 1, 2004, and before January 1, 2008.

 

          SECTION 46. (1) Section 38 of this 2003 Act becomes operative on the day after the date of receipt of all necessary federal approvals by the Centers for Medicare and Medicaid Services.

          (2) The Director of Human Services shall notify the Legislative Counsel upon receipt of the necessary federal approvals or denial of the federal approvals.

          NOTE: Section 47 was deleted by amendment. Subsequent sections were not renumbered.

 

          SECTION 48. Notwithstanding section 38 of this 2003 Act, an assessment under section 38 of this 2003 Act need not be reported and paid until 75 days after the date section 38 of this 2003 Act becomes operative under section 46 of this 2003 Act or the date on which an assessment report and payment is due under section 38 of this 2003 Act, whichever is later.

 

          SECTION 49. Sections 37 to 44 of this 2003 Act are repealed on January 2, 2010.

 

          SECTION 50. Nothing in the repeal of sections 37 to 44 of this 2003 Act by section 49 of this 2003 Act affects the imposition and collection of a prepaid managed care health services organization assessment under sections 37 to 44 of this 2003 Act for a calendar quarter beginning before January 1, 2008.

 

          SECTION 51. Any moneys remaining in the Medical Care Quality Assurance Fund on December 31, 2009, are transferred to the General Fund.

 

TAXES ON PROGRAMS OF ALL-INCLUSIVE

CARE FOR ELDERLY PERSONS

 

          SECTION 52. As used in sections 52 to 59 of this 2003 Act, “program of all-inclusive care for elderly persons” or “program” means a program offering long term care services and medical, dental, mental health and social services to persons 55 years of age and older on a capitated basis that features a comprehensive service delivery system and integrated Medicare and Medicaid financing.

 

          SECTION 53. (1) An assessment is imposed on each program of all-inclusive care for elderly persons in this state. The assessment shall equal five percent of the total capitation rate paid by the Department of Human Services under a program contract.

          (2) The assessment shall be reported on a form prescribed by the Department of Human Services and shall contain the information required to be reported by the department. The assessment form shall be filed with the department on or before the 75th day following the end of the calendar quarter for which the assessment is being reported. The program provider shall pay the assessment at the time the provider files the assessment report. The payment shall accompany the report.

 

          SECTION 54. Notwithstanding section 53 of this 2003 Act, the Director of Human Services may reduce the rate of assessment imposed under section 53 of this 2003 Act to the maximum rate allowed under federal law if the reduction is required to comply with federal law.

 

          SECTION 55. (1) A provider of a program of all-inclusive care for elderly persons that fails to file a report or pay an assessment under section 53 of this 2003 Act by the date the report or payment is due shall be subject to a penalty of $500 per day of delinquency. The total amount of penalties imposed under this section for each reporting period may not exceed five percent of the assessment for the reporting period for which penalties are being imposed.

          (2) Penalties imposed under this section shall be collected by the Department of Human Services and deposited in the Department of Human Services Account established under ORS 409.060.

 

          SECTION 56. (1) A provider of a program of all-inclusive care for elderly persons that has paid an amount that is not required under sections 52 to 59 of this 2003 Act may file a claim for refund with the Department of Human Services.

          (2) Any provider of a program that is aggrieved by an action of the Department of Human Services or by an action of the Director of Human Services taken under sections 52 to 59 of this 2003 Act shall be entitled to notice and an opportunity for a contested case hearing under ORS 183.310 to 183.550.

 

          SECTION 57. (1) Unless otherwise exempt, a provider of a program of all-inclusive care for elderly persons shall report the payment of the assessment as an allowable cost for Medicaid reimbursement purposes.

          (2) The Department of Human Services may audit the records of any program of all-inclusive care for elderly persons in this state to determine compliance with sections 52 to 59 of this 2003 Act. The department may audit records at any time for a period of five years following the date an assessment is due to be reported and paid under section 53 of this 2003 Act.

 

          SECTION 58. Amounts collected by the Department of Human Services from the assessment under section 53 of this 2003 Act shall be deposited in a suspense account established under ORS 293.445. Amounts necessary to pay refunds are continuously appropriated to the department from the suspense account. After the payment of refunds, the net amount of revenue shall be transferred to the PACE Quality Assurance Fund established under section 62 of this 2003 Act.

 

          SECTION 59. Sections 52 to 59 of this 2003 Act apply to capitation rates paid for programs of all-inclusive care for elderly persons for calendar months beginning on or after the effective date of this 2003 Act and before July 1, 2007.

 

          SECTION 60. Sections 52 to 59 of this 2003 Act are repealed on January 2, 2008.

 

          SECTION 61. Nothing in the repeal of sections 52 to 59 of this 2003 Act by section 60 of this 2003 Act affects the imposition and collection of a program of all-inclusive care for elderly persons assessment under sections 52 to 59 of this 2003 Act for a calendar month beginning before July 1, 2007.

 

          SECTION 62. (1) The PACE Quality Assurance Fund is established in the State Treasury, separate and distinct from the General Fund. Interest earned by the PACE Quality Assurance Fund shall be credited to the PACE Quality Assurance Fund.

          (2) Amounts in the PACE Quality Assurance Fund are continuously appropriated to the Department of Human Services for the purpose of funding programs of all-inclusive care for elderly persons, as defined in section 52 of this 2003 Act, that are a part of the Oregon Medicaid reimbursement system.

 

          SECTION 62a. Any moneys remaining in the PACE Quality Assurance Fund on December 31, 2009, are transferred to the General Fund.

 

          SECTION 63. (1) Section 53 of this 2003 Act becomes operative on the day after the date of receipt of all necessary federal approvals by the Centers for Medicare and Medicaid Services.

          (2) The Director of Human Services shall notify the Legislative Counsel upon receipt of the necessary federal approvals or denial of the federal approvals.

 

CONFLICTS

 

          SECTION 64. If House Bill 2152 become law, sections 72, 73, 74, 75, 76, 77, 78, 79, 80, 81, 82, 83, 84, 85, 86, 87, 88, 89, 90, 91, 92, 93, 94, 95, 96, 97, 98, 99, 100, 101, 102, 103, 104, 105, 106, 107, 108 and 109, chapter 709, Oregon Laws 2003 (Enrolled House Bill 2152), are repealed.

 

          SECTION 64a. Notwithstanding section 27, chapter [At Desk upon adjournment], Oregon Laws 2003 (Enrolled Senate Bill 231) (amending section 96, chapter 709, Oregon Laws 2003 (Enrolled House Bill 2152)), if Senate Bill 231 becomes law, section 96, chapter 709, Oregon Laws 2003 (Enrolled House Bill 2152), is repealed.

 

          SECTION 64b. Notwithstanding section 28, chapter [At Desk upon adjournment], Oregon Laws 2003 (Enrolled Senate Bill 231) (amending section 97, chapter 709, Oregon Laws 2003 (Enrolled House Bill 2152)), if Senate Bill 231 becomes law, section 97, chapter 709, Oregon Laws 2003 (Enrolled House Bill 2152), is repealed.

 

          SECTION 64c. Notwithstanding section 29, chapter [At Desk upon adjournment], Oregon Laws 2003 (Enrolled Senate Bill 231) (amending section 106, chapter 709, Oregon Laws 2003 (Enrolled House Bill 2152)), if Senate Bill 231 becomes law, section 106, chapter 709, Oregon Laws 2003 (Enrolled House Bill 2152), is repealed.

 

          SECTION 64d. Notwithstanding section 30, chapter [At Desk upon adjournment], Oregon Laws 2003 (Enrolled Senate Bill 231) (amending section 101, chapter 709, Oregon Laws 2003 (Enrolled House Bill 2152)), if Senate Bill 231 becomes law, section 101, chapter 709, Oregon Laws 2003 (Enrolled House Bill 2152), is repealed.

          NOTE: Sections 65 through 74 were deleted by amendment. Subsequent sections were not renumbered.

 

INCOME TAXES

(Film Production Development

Contribution Credit)

 

          SECTION 75. Section 76 of this 2003 Act is added to and made a part of ORS chapter 315.

 

          SECTION 76. (1) A credit against the taxes that are otherwise due under ORS chapter 316 or, if the taxpayer is a corporation, under ORS chapter 317 or 318, is allowed to a taxpayer for certified film production development contributions made by the taxpayer during the tax year to the Oregon Production Investment Fund established under section 79 of this 2003 Act.

          (2)(a) The amount of the tax credit shall equal the amount certified for credit by the Oregon Film and Video Office, except that a contribution must equal at least 90 percent of the tax credit.

          (b) The Oregon Film and Video Office shall adopt rules for determining the amount of tax credit to be certified by the office. The rules shall be adopted in order to achieve the following goals:

          (A) Subject to paragraph (a) of this subsection, generate contributions for which tax credits of $1 million are certified for each fiscal year;

          (B) Maximize income and excise tax revenues that are retained by the State of Oregon for state operations; and

          (C) Provide the necessary financial incentives for taxpayers to make contributions, taking into consideration the impact of granting a credit upon a taxpayer’s federal income tax liability.

          (3) A taxpayer seeking a tax credit under this section shall apply for tax credit certification to the Oregon Film and Video Office on a form supplied by the office. The taxpayer shall include payment of the contribution at the time of application.

          (4) Contributions made under this section shall be deposited in the Oregon Production Investment Fund.

          (5)(a) Upon receipt of a contribution, the Oregon Film and Video Office shall issue to the taxpayer written certification of the amount certified for tax credit under this section to the extent the amount certified for tax credit, when added to all amounts previously certified for tax credit under this section, does not exceed $1 million for the fiscal year in which certification is made.

          (b) The Oregon Film and Video Office is not liable, and a refund of a contributed amount need not be made, if a taxpayer who has received tax credit certification is unable to use all or a portion of the tax credit to offset the tax liability of the taxpayer.

          (6) To the extent the Oregon Film and Video Office does not certify contributed amounts as eligible for a tax credit under this section, the taxpayer may request a refund of the amount the taxpayer contributed, and the office shall refund that amount.

          (7)(a) Except as provided in paragraph (b) of this subsection, a tax credit claimed under this section may not exceed the tax liability of the taxpayer and may not be carried over to another tax year.

          (b) Any tax credit otherwise allowable under this section that is not used by the taxpayer in a particular tax year may be carried forward and offset against the taxpayer’s tax liability for the next succeeding tax year. Any credit remaining unused in the next succeeding tax year may be carried forward and used in the second succeeding tax year, and likewise, any credit not used in that second succeeding tax year may be carried forward and used in the third succeeding tax year but may not be carried forward for any tax year thereafter.

          (8) If a tax credit is claimed under this section by a nonresident or part-year resident taxpayer, the amount shall be allowed without proration under ORS 316.117.

          (9) A taxpayer who has received a tax credit certificate under this section may sell the certificate to another taxpayer. The sale is effective only if a notice of tax credit certificate sale is filed with the Department of Revenue. The notice shall be filed on a form prescribed by the department on or before the date on which the income or corporate excise tax return of the buyer for the first year for which the credit could be claimed is filed or due, whichever is earlier. The notice form shall include the following information:

          (a) The name and taxpayer identification number of the seller;

          (b) The name and taxpayer identification number of the buyer;

          (c) The amount of the tax credit certificate that is being sold to the buyer;

          (d) The amount of the tax credit certificate that is being retained by the seller; and

          (e) Any other information required by the department.

          (10) If requested by the Department of Revenue, the Oregon Film and Video Office shall supply a list of taxpayers that have obtained tax credit certification under this section, and for each listed taxpayer disclose:

          (a) The amount of contribution made by the taxpayer; and

          (b) The amount certified for tax credit under this section.

          (11) If the amount of contribution for which a tax credit certification is made is allowed as a deduction for federal tax purposes, the amount of the contribution shall be added to federal taxable income for Oregon tax purposes.

 

          SECTION 77. Section 76 of this 2003 Act applies to tax years beginning on or after January 1, 2005, and to tax credit certifications issued by the Oregon Film and Video Office on or after July 1, 2005.

 

          SECTION 78. Sections 79 to 81 of this 2003 Act are added to and made a part of ORS 284.300 to 284.375.

 

          SECTION 79. (1) The Oregon Production Investment Fund is established in the State Treasury, separate and distinct from the General Fund. Interest earned by the Oregon Production Investment Fund shall be credited to the fund.

          (2) Moneys in the Oregon Production Investment Fund shall consist of:

          (a) Amounts donated to the fund;

          (b) Amounts appropriated or otherwise transferred to the fund by the Legislative Assembly;

          (c) Other amounts deposited in the fund from any source; and

          (d) Interest earned by the fund.

          (3) All moneys in the fund are continuously appropriated to the Economic and Community Development Department for the purposes of making:

          (a) Reimbursements authorized under section 80 of this 2003 Act;

          (b) Payments to a tax credit marketer for marketing services provided by the marketer as described in section 81 of this 2003 Act; and

          (c) Refunds described in section 76 (6) of this 2003 Act.

          (4) Expenditures from the fund are not subject to ORS 291.232 to 291.260.

 

          SECTION 80. (1) As used in this section:

          (a) “Actual expenses” means the costs paid in Oregon for principal photography, production or postproduction in Oregon of a film, including but not limited to the purchase or rental cost of equipment, food, lodging, real property and permits and payments made for salaries, wages and benefits for work in Oregon.

          (b) “Film” means a television movie or one or more episodes of a single television series, or a movie produced for release to theaters, video or the Internet. “Film” does not include the production of a commercial or one or more segments of a newscast or sporting event.

          (2)(a) The Economic and Community Development Department may reimburse a bona fide television or film production company for a portion of the actual expenses paid in Oregon by the television or film production company to produce a film.

          (b) Maximum reimbursement for a single film, other than a television series, shall be 10 percent of actual expenses paid or $250,000, whichever is less. Maximum reimbursement for one or more episodes of a television series shall be 10 percent of actual expenses paid or $30,000 per episode produced in Oregon, whichever is less.

          (c) In order to qualify for reimbursement under this section, total actual expenses paid for the film must equal or exceed $1 million.

          (d) Reimbursement under this section shall be made from moneys credited to or deposited in the Oregon Production Investment Fund during the biennium in which the actual expenses were paid or any prior biennium. A reimbursement may not be made to the extent funds are not available in the fund to make the reimbursement.

          (3)(a) Total actual expenses supporting a claim for reimbursement under this section must be verified by the Oregon Film and Video Office. The production company must submit to the office proof of the actual expenses paid in Oregon to produce the film. The proof must include any documentation that may be required by the office in its discretion to verify the actual expenses.

          (b) The office may charge the production company for costs reasonably incurred to verify the actual expenses, including but not limited to the cost for a review or audit of the supporting documentation by an accountant or auditor. The office may require the department to deduct the costs incurred by the office in performing its review or audit from any reimbursement made to the production company under this section.

          (c) The office may adopt rules that establish a procedure for the submission and verification of actual expenses.

 

          SECTION 81. The Oregon Film and Video Office may hire or contract with a marketer to market the tax credits described in section 76 of this 2003 Act to taxpayers.

 

          SECTION 82. Reimbursement may be made under section 80 of this 2003 Act only for actual expenses paid by a television or film production company on or after January 1, 2005.

 

(Miscellaneous)

 

          SECTION 83. If House Bill 2152 becomes law, section 4, chapter 709, Oregon Laws 2003 (Enrolled House Bill 2152), is amended to read:

          Sec. 4. (1) For tax years beginning on or after January 1, 2003, and before January 1, 2005, each person subject to tax under this chapter shall compute and pay an assessment. The assessment shall be a percentage of the tax liability of the taxpayer and shall be added to the tax otherwise imposed under this chapter for the tax year. The rate of the assessment is as follows:

          (a) If the federal adjusted gross income of the taxpayer for the tax year is less than $10,000, an assessment may not be imposed.

          (b) If the federal adjusted gross income of the taxpayer for the tax year is $10,000 or more, but less than $20,000, the assessment shall equal 1 percent of the tax liability of the taxpayer.

          (c) If the federal adjusted gross income of the taxpayer for the tax year is $20,000 or more, but less than $25,000, the assessment shall equal 2 percent of the tax liability of the taxpayer.

          (d) If the federal adjusted gross income of the taxpayer for the tax year is $25,000 or more, but less than $30,000, the assessment shall equal 3 percent of the tax liability of the taxpayer.

          (e) If the federal adjusted gross income of the taxpayer for the tax year is $30,000 or more, but less than $35,000, the assessment shall equal 4 percent of the tax liability of the taxpayer.

          (f) If the federal adjusted gross income of the taxpayer for the tax year is $35,000 or more, but less than $50,000, the assessment shall equal 5 percent of the tax liability of the taxpayer.

          (g) If the federal adjusted gross income of the taxpayer for the tax year is $50,000 or more, but less than $70,000, the assessment shall equal 6 percent of the tax liability of the taxpayer.

          (h) If the federal adjusted gross income of the taxpayer for the tax year is $70,000 or more, but less than $90,000, the assessment shall equal 7 percent of the tax liability of the taxpayer.

          (i) If the federal adjusted gross income of the taxpayer for the tax year is $90,000 or more, but less than $120,000, the assessment shall equal 8 percent of the tax liability of the taxpayer.

          (j) If the federal adjusted gross income of the taxpayer for the tax year is $120,000 or more, the assessment shall equal 9 percent of the tax liability of the taxpayer.

          (2) The assessment is in addition to and not in lieu of any other tax. For all purposes of administration, collection and enforcement, the assessment imposed under this section shall be considered a tax imposed on income.

          (3) For purposes of subsection (1) of this section:

          (a) The amounts of the federal adjusted gross income brackets are doubled for a taxpayer who files a joint return, a return as a head of household or a return as a surviving spouse.

          (b) The tax liability of the taxpayer is the tax computed for the tax year under this chapter before application of this section less credits allowed for purposes of this chapter except that no reduction is made for the credit allowed under ORS 315.068 or 315.262.

 

          SECTION 84. If House Bill 2152 becomes law, section 5, chapter 709, Oregon Laws 2003 (Enrolled House Bill 2152), is amended to read:

          Sec. 5. (1) This section applies only if the projected ending fund balance for the General Fund for the biennium beginning July 1, 2003, as estimated by the Office of Economic Analysis of the Oregon Department of Administrative Services in the December 2004 quarterly economic and revenue forecast, is less than four percent of the total amount of General Fund appropriations for the biennium beginning July 1, 2003.

          (2) For tax years beginning on or after January 1, 2005, and before January 1, 2006, each person subject to tax under this chapter shall compute and pay an assessment. The assessment shall be a percentage of the tax liability of the taxpayer, and shall be added to the tax otherwise imposed under this chapter for the tax year. The rate of the assessment is as follows:

          (a) If the federal adjusted gross income of the taxpayer for the tax year is less than $10,000, an assessment may not be imposed.

          (b) If the federal adjusted gross income of the taxpayer for the tax year is $10,000 or more, but less than $20,000, the assessment shall equal 1 percent of the tax liability of the taxpayer.

          (c) If the federal adjusted gross income of the taxpayer for the tax year is $20,000 or more, but less than $25,000, the assessment shall equal 2 percent of the tax liability of the taxpayer.

          (d) If the federal adjusted gross income of the taxpayer for the tax year is $25,000 or more, but less than $30,000, the assessment shall equal 3 percent of the tax liability of the taxpayer.

          (e) If the federal adjusted gross income of the taxpayer for the tax year is $30,000 or more, but less than $35,000, the assessment shall equal 4 percent of the tax liability of the taxpayer.

          (f) If the federal adjusted gross income of the taxpayer for the tax year is $35,000 or more, but less than $50,000, the assessment shall equal 5 percent of the tax liability of the taxpayer.

          (g) If the federal adjusted gross income of the taxpayer for the tax year is $50,000 or more, but less than $70,000, the assessment shall equal 6 percent of the tax liability of the taxpayer.

          (h) If the federal adjusted gross income of the taxpayer for the tax year is $70,000 or more, but less than $90,000, the assessment shall equal 7 percent of the tax liability of the taxpayer.

          (i) If the federal adjusted gross income of the taxpayer for the tax year is $90,000 or more, but less than $120,000, the assessment shall equal 8 percent of the tax liability of the taxpayer.

          (j) If the federal adjusted gross income of the taxpayer for the tax year is $120,000 or more, the assessment shall equal 9 percent of the tax liability of the taxpayer.

          (3) The assessment is in addition to and not in lieu of any other tax. For all purposes of administration, collection and enforcement, the assessment imposed under this section shall be considered a tax imposed on income.

          (4) For purposes of subsection (2) of this section:

          (a) The amounts of the federal adjusted gross income brackets are doubled for a taxpayer who files a joint return, a return as a head of household or a return as a surviving spouse.

          (b) The tax liability of the taxpayer is the tax computed for the tax year under this chapter before application of this section less credits allowed for purposes of this chapter except that no reduction is made for the credit allowed under ORS 315.068 or 315.262.

 

          SECTION 85. If House Bill 2152 becomes law, section 31, chapter 709, Oregon Laws 2003 (Enrolled House Bill 2152), is amended to read:

          Sec. 31. (1) Every S corporation doing business in this state shall pay annually to the state, for the privilege of carrying on or doing business within this state, a minimum tax as follows:

          (a) If the S corporation has Oregon sales for the tax year of less than $1 million, $250.

          (b) If the S corporation has Oregon sales for the tax year of $1 million or more, $500.

          (2) The minimum tax is not apportionable, except in the case of a change of accounting periods. The minimum tax is payable in full for any part of a year during which an S corporation conducts business in this state.

          (3) The minimum tax shall be due and payable on or before the 15th day of the month following the [close of] due date of the federal return of the S corporation for the tax year, and shall be reported and paid in the manner prescribed by the Department of Revenue by rule.

          (4) The minimum tax shall be considered a tax imposed on taxable income for all purposes of collection and enforcement.

          (5) As used in this section, “Oregon sales” means:

          (a) If the S corporation apportions business income under ORS 314.650 to 314.665 for Oregon tax purposes, the total sales of the taxpayer during the tax year, as determined for purposes of ORS 314.665;

          (b) If the S corporation does not apportion business income for Oregon tax purposes, the total sales the taxpayer would have had, as determined for purposes of ORS 314.665, if the taxpayer were required to apportion business income for Oregon tax purposes; or

          (c) If the S corporation apportions income using a method different than that prescribed by ORS 314.650 to 314.665, Oregon sales as defined by the Department of Revenue by rule.

 

CAPTIONS

 

          SECTION 86. The unit captions used in this 2003 Act are provided only for the convenience of the reader and do not become part of the statutory law of this state or express any legislative intent in the enactment of this 2003 Act.

 

EFFECTIVE DATE

 

          SECTION 87. This 2003 Act takes effect on the 91st day after the date on which the regular session of the Seventy-second Legislative Assembly adjourns sine die.

 

Approved by the Governor August 29, 2003

 

Filed in the office of Secretary of State September 2, 2003

 

Effective date November 26, 2003

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