SB17,15,33 (g) Amounts paid for services regulated under s. 111.18 (2) (a) 1.
SB17,15,10 4(2) (a) After reviewing the hospital's financial requirements and rate request,
5the commission staff shall suggest any disallowances authorized under sub. (1) and
6shall submit its rate recommendations to the hospital and commission. If it considers
7the hospital proposal unacceptable, the commission staff shall explain to the hospital
8what facts and standards cause it to disagree and shall submit alternate
9recommendations. A hospital that fails to accept any part of the commission staff's
10recommendations shall request a settlement conference under s. 196.998.
SB17,15,1611 (b) 1. Except as provided in subd. 2., the commission staff shall submit its
12recommendations under par. (a) within 60 days after the date that review
13commences under s. 196.994 (1), even if the commission staff determines that the
14data provided by the hospital for a scheduled review are incomplete. The commission
15staff may, however, recommend a disallowance or an alternate rate, including no rate
16increase, on the grounds of insufficient data.
SB17,15,1917 2. a. The commission staff may extend the deadline specified in subd. 1. by 15
18days if it determines that the rate request submitted involves particularly complex
19issues of fact.
SB17,15,2120 b. The deadline specified in subd. 1. may be extended with the consent of the
21hospital and the commission staff.
SB17,16,5 22196.998 Review of determinations. (1) Any hospital that disputes any part
23of the recommendations of the commission staff under s. 196.997 shall, within 10
24days after the recommendations are submitted under s. 196.997 (2), request a
25settlement conference between its representatives and the commission staff for the

1purpose of resolving their differences or defining more precisely the nature of their
2differences. The chairperson of the commission, or a commissioner designated by the
3chairperson, shall preside over each settlement conference. Within 20 days after the
4hospital requests a settlement conference, the settlement conference shall be
5completed.
SB17,16,13 6(2) Any hospital that is dissatisfied with the results of its settlement conference
7under sub. (1) is entitled to a hearing before the commission under sub. (3) if it
8submits a timely request. Each request for a hearing shall be submitted to the
9commission within 10 days after the completion of the settlement conference. The
10hospital may present testimony based on any standard for decision making listed in
11s. 196.996. All questions of fact shall be determined without ascribing greater weight
12to evidence presented by commission staff than to evidence presented by any other
13party solely due to its presentation by the staff.
SB17,16,19 14(3) (a) Informal hearings shall be conducted before at least 2 commissioners.
15Sworn testimony is required only if the presiding commissioners so specify. The
16commissioners may establish time limits for cross-examination of witnesses and
17rebuttal arguments and may limit the number of persons who may appear at the
18hearing. Rules of evidence, except the rule that evidence be relevant to the issues
19presented, do not apply to informal hearings.
SB17,17,220 (b) A hospital that requests an informal hearing shall present the reasons
21supporting its proposed rate increase and financial requirements. Commission staff
22shall respond by explaining its disagreement and its alternate recommendations.
23Within the time limits specified in par. (a), the hospital, parties to the review and
24commission staff may each cross-examine witnesses and rebut arguments
25presented. The hospital, parties to the review and the commission staff may use

1outside experts to present their position. The presiding commissioners may impose
2an overall time limit on the length of the hearing.
SB17,17,43 (c) The commission may, by order, conduct a class 1 contested case proceeding
4under ch. 227 in place of an informal hearing under pars. (a) and (b).
SB17,17,9 5(5) The commission shall keep a complete record of all hearings and
6investigations conducted under sub. (3) using a stenographic, electronic or other
7method to record all testimony presented. The commission shall provide a
8transcribed, certified copy of all or any part of this record on the request of any party
9to a hearing or investigation, but may charge the requester for the costs involved.
SB17,17,14 10(6) (a) Any person may request a hearing under s. 227.44, regardless of whether
11any other hearing is authorized by law or is authorized at the discretion of the
12commission or whether any other proceeding is authorized by rule of the commission,
13subject to the limitation that no person may receive more than one contested case
14hearing concerning a particular act or failure to act by the commission.
SB17,17,1615 (b) Notwithstanding par. (a), no person may request a hearing under s. 227.44
16pertaining to the subject matter of a hearing under sub. (3).
SB17,17,1817 (c) The right to a hearing under s. 227.44, as specified in this subsection, applies
18only to subject matter pertaining to this subchapter.
SB17,18,6 19196.999 Commission orders. (1) (a) The commission shall determine
20allowable financial requirements under s. 196.995 and disallowances under s.
21196.997. From the difference between these amounts, the commission shall subtract
22the hospital's estimated relief payments and medical assistance payments under ch.
2349 and medicare payments under 42 USC 1395 to 1395ccc, unless the commission
24determines that the hospital's estimates are incorrect, in which case the commission
25shall subtract its own estimates of the hospital's relief, medical assistance and

1medicare payments. The commission shall, by order, establish maximum rates that
2allow the hospital to generate revenue sufficient to provide this remainder. The
3commission shall, by rule, establish acceptable methods of estimating payments by
4relief, medical assistance and medicare under this paragraph. Each hospital shall
5choose one of these methods and use it consistently unless the commission authorizes
6the hospital to change its method.
SB17,18,157 (b) Unless the hospital requests a hearing under s. 196.998 (3), the commission
8shall issue its order under par. (a) within 15 days after the commission staff submits
9its recommendations or, if the hospital requests a settlement conference under s.
10196.998 (1), within 15 days after the commission determines that the hospital will
11not seek a hearing following the conclusion of the settlement conference. If the
12hospital disputes only part of the recommendations of the commission staff, the
13commission may establish maximum rates under par. (a) concerning the
14recommendations with which the hospital agrees prior to the conclusion of the
15hearing under s. 196.998 (3).
SB17,18,2116 (c) If the hospital disputes the recommendations of the commission staff and
17a hearing is held under s. 196.998 (3) (c), the commission shall establish by order
18maximum rates for the hospital's year under review at the conclusion of the hearing.
19If the commission conducts an informal hearing under s. 196.998 (3) (a) and (b), it
20shall issue its order within 50 days after the date on which the hospital requested
21the hearing.
SB17,18,2522 (d) 1. The commission shall state findings of fact and the reasons supporting
23each order that it issues concerning financial requirements and rates. If the
24commission denies any part of a rate request, it shall also specify, as part of its order,
25any financial requirements that it has disallowed.
SB17,19,21
12. Any hospital may apply an increase in its rates selectively, if the aggregate
2increase in its rates does not exceed the amount authorized by the commission. Prior
3to instituting its rate increase, the hospital shall explain to the commission its
4method of applying the rate increase and allow the commission 5 working days, as
5defined in s. 227.01 (14), to determine if the aggregate increase in rates exceeds the
6authorized amount. Failure to disapprove the hospital's method of applying the rate
7increase within this period constitutes an approval. If the commission approves the
8hospital's method of applying the rate increase, the commission may not challenge
9the method prior to the date of a succeeding review under s. 196.994 (1) except as
10provided in sub. (4) (a). If the commission disapproves the hospital's method of
11applying the rate increase, it shall recommend an alternate method. If the hospital
12fails to modify its method of applying the rate increase, the commission may
13challenge the method in circuit court. In addition to any other remedy the court may
14impose under s. 196.9994, if the court finds that the hospital's method generates an
15aggregate increase in the hospital's rates that is inconsistent with the amount
16authorized by the commission, the hospital shall forfeit an amount equal to 50% of
17the amount overcharged and shall comply with the alternate method recommended
18by the commission or with any other method ordered by the court that the court finds
19more consistent with the commission's order. No hospital may change a method of
20applying its rate increase that has received the commission's approval without
21submitting the changes to the commission for its approval under this subdivision.
SB17,20,222 3. Any hospital receiving a rate increase that may only commence between the
232nd and 7th months of its fiscal year may make an adjustment to the rate increase,
24that applies to that fiscal year only, in order to generate an amount of revenue equal

1to the amount that would have been generated if the hospital could have commenced
2the rate increase beginning with the first month of its fiscal year.
SB17,20,63 (e) Except as provided in s. 196.9991, even if a party seeks judicial review of
4a commission order, the affected hospital may continue to bill payers at the rates
5established by the commission. No hospital that bills payers under this paragraph
6adversely affects its right to contest the rates established by the commission.
SB17,20,9 7(1m) Notwithstanding sub. (1) (b) and ss. 196.994 (1), 196.997 (2) and 196.998,
8at the request of a hospital the commission may waive the procedures for review of
9a rate request and issue an interim order in an emergency.
SB17,20,12 10(2) The commission shall determine the rates of each hospital independently
11using criteria specified in s. 196.996, but in making these determinations the
12commission may use methods of identifying similar hospitals.
SB17,20,20 13(3) The commission may promulgate rules establishing a system that defines
14rates as aggregate charges based on case mix measurements if the commission
15submits its proposed system to the joint committee on finance under s. 13.10, receives
16that committee's approval and holds a public hearing prior to promulgating its rules.
17Such a system may not take effect prior to July 1, 1998, shall be consistent with the
18standard under s. 196.996 (1), shall take into account the reasonable financial
19requirements of hospitals and shall ensure quality of care and a reasonable cost to
20patients.
SB17,20,21 21(4) The commission may not:
SB17,20,2522 (a) Reduce rates that it has established, prior to the date the commission
23schedules a succeeding review under s. 196.994 (1), unless the hospital misstated
24any material fact at a prior rate-setting proceeding. Projections on the volume of
25hospital services utilized do not constitute material facts under this paragraph.
SB17,21,2
1(b) During a succeeding review under s. 196.994 (1), reduce rates from levels
2that it has previously established, except in any of the following situations:
SB17,21,43 1. The hospital implements an unauthorized increase in its approved rates,
4unless the increase is trivial.
SB17,21,65 2. The hospital uses the funds that it has prospectively accumulated for an
6authorized capital project for purposes other than the authorized project.
SB17,21,87 4. The hospital's actual total revenue for its fiscal year exceeds it actual total
8financial requirements by more than 10%.
SB17,21,129 (c) Interfere directly in the personal or decision-making relationships between
10a patient and the patient's physician, except as provided in ss. 196.9993 and
11196.9994 (2). This paragraph does not limit the commission's ability to make
12determinations under sub. (1) (a) or s. 196.997.
SB17,21,1513 (d) Control directly the volume or intensity of hospital utilization, except as
14provided in ss. 196.9993 and 196.9994 (2). This paragraph does not limit the
15commission's ability to make determinations under sub. (1) (a) or s. 196.997.
SB17,21,1916 (e) Restrict the freedom of patients to receive care at a hospital consistent with
17their religious preferences or request a hospital that is affiliated with a religious
18group to act in a manner contrary to the mission and philosophy of the religious
19group.
SB17,21,2220 (f) Restrict directly the freedom of hospitals to exercise management decisions
21in complying with the rates established by the commission, unless a hospital agrees
22to a condition attached to the establishment of particular rates.
SB17,21,2423 (g) Require the submission of unrelated financial data from religious groups
24affiliated with a hospital.
SB17,22,3
1196.9991 Injunctions of commission orders. No injunction may be issued
2to suspend or stay enforcement of an order of the commission unless all of the
3following occur:
SB17,22,7 4(1) All parties to the proceeding from which the commission's order was issued
5are notified of the petition seeking an injunction, are given an opportunity to appear
6at a hearing prior to the issuance of the injunction and are made parties to the
7proceeding in circuit court.
SB17,22,12 8(2) The party seeking the injunction enters into an undertaking by at least 2
9sureties at a level that the circuit court finds sufficient to guarantee the payment of
10all damages the hospital may sustain by delaying the effect of the commission's order.
11This subsection does not apply to a hospital that was a party to the proceeding from
12which the commission's order was issued.
SB17,22,15 13196.9992 Expedited review, expedited cases and exempt hospitals. (1)
14The commission may promulgate rules under which hospitals meeting specific
15criteria receive expedited review of rate requests under this subchapter.
SB17,22,18 16(2) (a) A hospital whose gross annual patient revenue is less than $10,000,000,
17adjusted as provided in s. 196.9995, for the hospital's last fiscal year is eligible to
18receive automatic approval of its rate request if it meets all of the following criteria:
SB17,22,2019 1. The commission has conducted a complete review of the hospital's rates and
20has set the hospital's rates in a preceding year.
SB17,22,2321 2. The hospital requests a rate increase that is less than an inflationary index
22consisting of the average of the consumer price index and the hospital market basket
23index.
SB17,23,324 (b) Any hospital that receives automatic approval of its rate request under this
25subsection shall publish as a class 1 notice under ch. 985, in one or more newspapers

1likely to give notice to its patients and payers, a list of the price adjustments it is
2making to 100 of its charge elements as specified by the commission. The hospital
3shall publish this notice prior to implementing its rate increase.
SB17,23,54 (c) The commission may, by rule, extend automatic approval status under this
5subsection to other hospitals.
SB17,23,10 6(2m) The commission may grant hospitals whose gross annual patient revenue
7is less than $10,000,000, adjusted as provided in s. 196.9995, a rate increase that
8takes effect over a 2-year period with an automatic escalation clause taking effect
9at the end of the first year. A hospital that receives a 2-year rate increase is not
10required to request a rate increase at the end of the first year.
SB17,23,12 11(3) Any judicial proceeding affecting a rule or decision of the commission shall
12be heard and determined as expeditiously as possible.
SB17,23,16 13196.9993 Utilization review program. (1) The commission shall approve
14an all-patient utilization review program for each hospital that shall conform to
15requirements of federal regulations on utilization review programs. The commission
16may evaluate these programs as part of its monitoring functions under s. 196.994 (3).
SB17,23,22 17(2) The commission shall contract with one or more independent utilization
18review programs to develop review standards, and the commission may contract
19with any person to monitor implementation of these programs by hospitals and to
20perform peer review functions for hospitals that fail to meet the performance
21standards adopted by the commission. The commission may not contract with state
22agencies, other than the University of Wisconsin System, under this subsection.
SB17,24,2 23(3) Each utilization review program the commission approves shall include a
24general summary of utilization within the hospital. These programs need not

1otherwise be identical but shall meet minimum standards established by the
2commission and shall do all of the following:
SB17,24,43 (a) Evaluate the medical necessity or appropriateness of care relative to
4admissions, lengths of stay and ancillary services.
SB17,24,75 (b) Report to the commission, in conjunction with each hospital's submission
6of proposed financial requirements, any findings that it has made regarding
7unnecessary or inappropriate medical care utilization and associated costs.
SB17,24,12 8196.9994 Enforcement. (1) (a) Until the commission establishes different
9rates under this subchapter, no hospital may charge any payer an amount exceeding
10the rates established as of the effective date of this paragraph .... [revisor inserts
11date]. No hospital may charge any payer an amount exceeding the rates established
12under this subchapter.
SB17,24,1913 (b) The attorney general may seek a judicial remedy to enforce compliance with
14par. (a) if the attorney general first notifies the hospital and provides the hospital a
15reasonable time to correct a violation. The commission may seek a judicial remedy
16to enforce compliance with any statutory requirement or with any rule or order of the
17commission if it first notifies the hospital and provides the hospital a reasonable time
18to correct a violation. The commission shall commence any action under this
19paragraph in the circuit court for the county in which the hospital is located.
SB17,24,2320 (c) Any court that finds an intentional failure to comply with the rates under
21this subsection may impose a forfeiture of up to $5,000. Each week that a hospital
22continues its intentional failure to comply with the rates constitutes a separate
23violation.
SB17,25,4 24(2) Neither a hospital nor a physician may be paid for a service that a
25utilization review program under s. 196.9993 determines is medically unnecessary

1or inappropriate. If the hospital or physician has already been paid, the hospital or
2physician shall reimburse the payer within 30 days. The commission may commence
3an action to enforce this subsection in the circuit court for the county in which the
4hospital is located.
SB17,25,7 5(3) Any court with jurisdiction over an action brought under this section may
6adopt remedies that it finds necessary to enforce compliance. Remedies under this
7section apply notwithstanding the existence or pursuit of any other remedy.
SB17,25,10 8(4) Any person who intentionally violates an order of a hearing examiner
9issued under s. 227.46 (7) to protect trade secrets in a contested case brought under
10this subchapter shall forfeit $5,000.
SB17,25,14 11196.9995 Annual adjustments. The limits on gross annual patient revenue
12in ss. 196.997 (1) (b) and 196.9992 (2) (a) (intro.) and (2m) shall be adjusted annually
13to reflect annual changes in the average of the consumer price index and the hospital
14market basket index.
SB17,25,15 15196.9996 Assessments. (1) In this section:
SB17,25,1816 (a) "Commercial insurance" includes a group or individual disability insurance
17policy, as defined in s. 632.895 (1) (a), an employer's self-insured health care plan
18and worker's compensation.
SB17,25,2119 (b) "Deduction" means the portion of a charge that was incurred by a patient
20but was not received from 3rd-party payers or governmental or private payment.
21"Deduction" includes charity care but does not include bad debt.
SB17,25,2322 (c) "Expense" means the cost of operation, including bad debt, that is charged
23to a hospital during the hospital's fiscal year.
SB17,26,224 (d) "Gross patient revenue" means the total charges to medicare, as defined in
25s. 49.498 (1) (f), the medical assistance program, other public programs, commercial

1insurance and other self-payers or nonpublic payers, that are generated by a
2hospital from inpatient and outpatient services.
SB17,26,43 (e) "Net income" means total revenue and nonoperating gains in excess of
4expenses and nonoperating losses.
SB17,26,55 (f) "Net patient revenue" means gross patient revenue minus deductions.
SB17,26,76 (g) "Nonoperating gains" means gifts, donations, endowments, return on
7investments and any other gains that are not related to patient care.
SB17,26,108 (h) "Nonoperating losses" means state and federal corporate income and real
9estate taxes and other losses that are not directly related to patient care or
10hospital-related patient services.
SB17,26,1311 (i) "Other public programs" include programs operated by or contracted for by
12county departments under s. 46.215, 46.22 or 46.23 and the relief program under ch.
1349.
SB17,26,1614 (j) "Other revenue" means revenue from services, other than health care
15services, provided to patients and revenue from sales to and services provided to
16nonpatients.
SB17,26,1717 (k) "Total revenue" means the sum of net patient revenue and other revenue.
SB17,27,3 18(2) Beginning July 1, 1998, the commission shall, within 90 days after the
19commencement of each fiscal year, estimate the total amount of revenue required for
20administration by the commission of this subchapter during that fiscal year and
21assess that estimated total amount to hospitals, under the rates established by rule
22under s. 196.993 (2) and in proportion to each hospital's respective net income during
23the hospital's most recently concluded entire fiscal year. The commission may not
24assess under this subsection a hospital that has a net income of 3% or less over the
25net income for the hospital's next most recently concluded entire fiscal year. Each

1hospital that is assessed shall pay the assessment by the December 1 following the
2assessment. The commission shall credit all payments of assessments to the
3appropriation account under s. 20.155 (3) (gm).
SB17,27,6 4196.9998 Capital expenditure review program. (1) Applicability.
5Beginning on July 1, 1998, no person may do any of the following without first
6obtaining the commission's approval:
SB17,27,14 7(a) Except as provided in sub. (2), obligate for a capital expenditure, by or on
8behalf of a hospital, that exceeds $1,000,000. The cost of the studies, surveys, plans
9and other activities essential to the proposed capital expenditure shall be included
10in determining the value of the capital expenditure. Any donation of equipment or
11facilities that, if acquired directly, would be subject to review under this section is a
12capital expenditure. Any transfer of equipment or facilities for less than fair market
13value that, if transferred at fair market value, would be subject to review under this
14section is a capital expenditure.
SB17,27,19 15(b) Implement services new to the hospital that exceed $500,000 in a 12-month
16period, including an organ transplant program, burn center, neonatal intensive care
17program, cardiac program or air transport services; implement other services or
18programs specified by the commission by rule; or add psychiatric or chemical
19dependency beds.
SB17,27,23 20(c) Obligate for an expenditure by or on behalf of a hospital, independent
21practitioner, limited liability company, partnership, unincorporated medical group
22or service corporation, as defined in s. 180.1901 (2), that exceeds $500,000 for clinical
23medical equipment.
SB17,27,2424 (d) Purchase or otherwise acquire a hospital.
SB17,27,25 25(e) Construct or operate an ambulatory surgery center or a home health agency.
SB17,28,4
1(2) Exemptions from capital expenditure review. (a) Subsection (1) does not
2apply if a person has, prior to the effective date of this subsection .... [revisor inserts
3date], entered into a legally enforceable contract, promise or agreement with another
4to do any of the activities specified in sub. (1) (a) to (e).
SB17,28,11 5(b) A person may obligate for a capital expenditure by or on behalf of a hospital
6without obtaining the approval of the commission if the expenditure is for heating,
7air conditioning, ventilation, electrical systems, energy conservation,
8telecommunications, computer systems or nonsurgical outpatient services, unless
9any such expenditure is a constituent of another project reviewable under sub. (1)
10or unless any such expenditure would exceed 20% of a hospital's gross annual patient
11revenue for its last fiscal year.
SB17,28,12 12(3) Innovative medical technology exemption. (a) In this subsection:
SB17,28,17 131. "Clinical trial" means clinical research conducted under approved protocols
14in compliance with federal requirements applicable to investigations involving
15human subjects, including the requirement for an informed consent advising the
16patient clearly of the risks associated with participating in the clinical development
17and evaluation project.
SB17,28,20 182. "Innovative medical technology" means equipment or procedures that are
19potentially useful for diagnostic or therapeutic purposes and that introduce new
20technology in the diagnosis and treatment of illness.
SB17,28,25 21(b) The commission may grant an exemption from the requirements of approval
22under this section for the research, development and evaluation of innovative
23medical technology, the development of the clinical applications of this technology or
24the research, development and evaluation of a major enhancement to existing
25medical technology if all of the following occur:
SB17,29,3
11. The commission receives an application for an exemption from a person
2intending to undertake a capital expenditure in excess of $500,000 or intending to
3undertake a substantial change in a health service.
SB17,29,7 42. Prior to applying for an exemption, preliminary animal studies or
5preliminary clinical investigation establishes that the innovative medical
6technology or major enhancement to existing medical technology has a reasonable
7probability of advancing clinical diagnosis or therapy.
SB17,29,10 83. In the development and evaluation of the clinical applications, the applicant
9undertakes scientifically sound studies to determine clinical efficacy, safety,
10cost-effectiveness and appropriate utilization levels in a clinical setting.
SB17,29,14 114. The clinical trials, evaluation or research are conducted according to
12scientifically sound protocols subject to peer review and approval in accord with the
13requirements applicable to investigations and clinical evaluation involving human
14subjects.
SB17,29,16 155. The innovative medical technology is being installed to conduct necessary
16research, development and evaluation.
SB17,29,22 176. The applicant does not include any recovery of capital expenses incurred as
18part of an exemption under this subsection in its expense and revenue budget for
19purposes of rate setting until the applicant receives the approval of the federal food
20and drug administration and of the commission under this section for general
21medical use. The applicant may recover operating expenses only after all of the
22following occur:
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