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New York State Accounting System User Procedures Manual

Volume Name
Section Name
Special Payments - Hospital and Health Related Services

     This section provides guidelines and procedures for processing payments of State funds to hospitals and other health service providers for care provided to wards, clients, inmates, etc, of State agencies.


     The statutory authority for these payments are Section 109 of the State Finance Law and Section 2807 of the Public Health Law.


     The Public Health Law provides that payments by government agencies to hospitals and health related service providers shall be at a rate approved by the State Director of the Budget and certified by the Commissioner of Health. These rates are published in the New York State Physician Procedure Code and Fees Schedule for health providers. The hospital rates are published in the Hospital In Patient-Out Patient Rate Schedule. They are reasonable in relation to the efficient cost of providing the services.

     Vouchers submitted by hospitals must be at the approved daily rate for the particular hospital. These daily rates are inclusive of all services provided by the hospitals. Vouchers must contain the patient's name, the dates the services were rendered, the total number of days billed and the hospital rate.

     Vouchers submitted by other health service providers, doctors, etc., must include the patient's name, the medical Fee Schedule code for the service and the Medical Fee Schedule Rate for the service.

     Payments made by State agencies to hospitals and providers cannot exceed the amounts in the schedules. Payments to a hospital or provider by State agencies are not affected by payments made by other health insurance plans for the ward, client, or inmate. Agencies should be aware if other payments are being made to the providers. State agencies should ensure that a provider is not being paid an unreasonable or excessive amount for services rendered to clients, etc.

     Vouchers should be prepared and processed in accordance with current procedures in the User Procedure Manual, Volume III, Encumbrances and Expenditures, Section 4.


     Vouchers making payment for medical services must have a "H" code in the 1099 block.