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Category:
Financial



Responsible Office:

Policy Title:
Revenue Fund Guidelines: Hospital Income Fund Reimbursable (HIFR)

Document Number:
7607

Effective Date:
July 01, 2001


This policy item applies to:
Downstate Medical Center State
University at Stony Brook Health Science Center
Upstate Medical University
Table of Contents
Summary

Policy
Definitions
Other Related Information
Procedures
Forms
Authority
History
Appendices


Summary

The State University of New York (University) hospital income fund reimbursable (HIFR) was established as a special revenue fund. The fund allows for organizational and accounting independence for University health care facilities. The HIFR operates and administers the fiscal aspects of health care related operational activities.


Policy

I. Purpose and Scope of Activities

II. Categories

The following categories shall govern the operation of the HIFR accounts and activities:

III. Financial Management

IV. Guidelines for Specific Funds – Hospital Income Fund Reimbursable

       This policy delegates extensive authority to the health care facilities for the conduct of activities through the HIFR mechanism. The policy and general guidelines identify those activities and functions for which the health care facilities and system administration are responsible. The policy also provides direction to the health care facilities in the development of their own policies, operating guidelines and procedures. Each health care facility is expected to develop and maintain its own guidelines and procedures that address both accountability and patient confidentiality.


Definitions

University Health Care Facility – hospital operated by the University and includes the University Health Sciences Center at Brooklyn, , Stony Brook or Syracuse (hereinafter referred to as "health care facility" or "facility").


Other Related Information

Health-Related Services Contracts

Annual Executive Budget Overview by Agency


Procedures

There are no procedures relevant to this policy.


Forms

There are no forms relevant to this policy.


Authority

The following links to FindLaw's New York State Laws are provided for users' convenience; it is not the official site for the State of New York laws. 

Public Health Law

Civil Service Law Article 14 (Public Employers’ Fair Employment Act)

In case of questions, readers are advised to refer to the New York State Legislature site for the menu of New York State Consolidated.

New York State Constitution Article 7(8) (State Finances)


Chapter 363 of the NYS Laws of 1998


State
University
Board of Trustees Resolution 93-47 adopted April 22, 1993.


History

In 1983-84, the Executive budget proposed a new appropriation schedule for the General Fund in order to separate the University health care facilities from the University proper. The goal was to have organizational and accounting independence in order to clearly distinguish between the health service function and the educational mission, which required state funding. In 1985, a study was commissioned to analyze health care facility organization and financing. This study was initiated in order to separate the teaching and service function from the University’s instructional and support programs.

In 1986-87, the final budget changed the funding structure of the health care facilities. University health care facility operations would be managed from income reimbursable accounts that were funded from facility reimbursement revenue and augmented by a General Fund subsidy. This structure prevented the interchange of appropriation and revenue authorization between the facilities and the academic programs of the University. The State of New York continued payment of fringe benefits for facility employees. The State of New York continued payment of a General Fund state subsidy to the three University health care facilities. This subsidy considered overall facility operating costs, including fringe benefits and capital expenditures.

In 1988-89, the final budget authorized the use of facility revenue for capital improvements at the health care facilities. The provision was added in order to give the facilities the flexibility to address capital needs within available resources and to establish local priorities.

In 1990-91, the final budget consolidated the three individual health care facility IFR funds into one IFR fund, from which the University could allocate support to the three health care facilities at its discretion. This consolidation was done in order to assure that each facility achieved operating self-sufficiency over a five-year period.

In 1998, Chapter 363 of the Laws of 1998 was enacted. This legislation permitted the health care facilities to enter into networking and managed care contracts. This helped the facilities to improve their competitiveness in the health care market and improve their revenue.

In 2000-2001, a national health care consulting firm (PWC) was engaged to assess the health care facilities’ finances and recommend short-term and long-term actions needed to maintain their financial health in a dynamic health care market. The facilities created five-year financial plans in order to address their operating deficits.

In 2001-02, the final budget restructured the appropriation structure for the health care facilities. This new structure allowed the facilities to display more accurately their operating costs and revenues. The facilities’ spending was in one account. The facilities assumed direct payment of their fringe benefits and debt service. The State subsidy was increased in order to recognize the costs attributable to their State agency status. The State also agreed to provide support for the STIP loan, which the facilities entered into in order to cover their accumulated deficit. This structure allowed the facilities to operate within their available revenues, inclusive of the State subsidy amount.

In 2003-04, the final budget recommended that the health care facilities receive $350 million in capital financing. The facilities requested this five-year capital financing in order to address their critical maintenance needs and expansion projects to allow them to enhance their services and remain competitive in an ever-changing health care market.


Appendices

There are no appendices relevant to this policy.