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Montana Administrative Register Notice 37-504 No. 8   04/29/2010    
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BEFORE THE DEPARTMENT OF PUBLIC

HEALTH AND HUMAN SERVICES OF THE

STATE OF MONTANA

 

In the matter of the amendment

of ARM 37.40.307 and 37.40.361 pertaining to Medicaid nursing facility reimbursement

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NOTICE OF PUBLIC HEARING ON PROPOSED AMENDMENT

 

TO:  All Concerned Persons

 

            1.  On May 19, 2010, at 10:00 a.m., the Department of Public Health and Human Services will hold a public hearing in the auditorium of the Department of Public Health and Human Services Building, 111 North Sanders, Helena, Montana, to consider the proposed amendment of the above-stated rules.

 

            2.  The Department of Public Health and Human Services will make reasonable accommodations for persons with disabilities who wish to participate in this rulemaking process or need an alternative accessible format of this notice.  If you require an accommodation, contact Department of Public Health and Human Services no later than 5:00 p.m. on May 10, 2010, to advise us of the nature of the accommodation that you need.  Please contact Rhonda Lesofski, Department of Public Health and Human Services, Office of Legal Affairs, P.O. Box 4210, Helena, Montana, 59604-4210; telephone (406) 444-4094; fax (406) 444-9744; or e-mail dphhslegal@mt.gov.

 

            3.  The rules as proposed to be amended provide as follows, new matter underlined, deleted matter interlined:

 

            37.40.307  NURSING FACILITY REIMBURSEMENT  (1) remains the same.

            (2)  Effective July 1, 2001, and in subsequent rate years, nursing facilities will be reimbursed using a price based reimbursement methodology.  The rate for each facility will be determined using the operating component defined in (2)(a) and the direct resident care component defined in (2)(b):

            (a) through (c) remain the same.

            (d)  The total payment rate available for the period July 1, 2009 2010 through June 30, 2010 2011 will be the rate as computed in (2), plus any additional amount computed in ARM 37.40.311 and 37.40.361.

            (3)  Providers who, as of July 1 of the rate year, have not filed with the department a cost report covering a period of at least six months participation in the Medicaid program in a newly constructed facility shall have a rate set at the statewide median price as computed on July 1, 2009 2010.  Following a change in provider as defined in ARM 37.40.325, the per diem rate for the new provider shall be set at the previous provider's rate, as if no change in provider had occurred.

            (4) through (12) remain the same.

 

AUTH:  53-2-201, 53-6-113, MCA

IMP:  53-6-101, 53-6-111, 53-6-113, MCA

 

            37.40.361  DIRECT CARE AND ANCILLARY SERVICES WORKERS' WAGE REPORTING/ADDITIONAL PAYMENTS INCLUDING LUMP SUM PAYMENTS FOR DIRECT CARE AND ANCILLARY SERVICES WORKERS' WAGE AND BENEFIT INCREASES  (1)  Effective for the period July 1, 2009 2010 and for the six months thereafter, nursing facilities must report to the department actual hourly wage and benefit rates paid for all direct care and ancillary services workers or the lump sum payment amounts for all direct care and ancillary services workers that will receive the benefit of the increased funds.  The reported data shall be used by the department for the purpose of comparing types and rates of payment for comparable services and tracking distribution of direct care wage funds to designated workers.

            (2)  The department will pay Medicaid certified nursing care facilities located in Montana that submit an approved request to the department a lump sum payment in addition to the amount paid as provided in ARM 37.40.307 and 37.40.311 to their computed Medicaid payment rate to be used only for wage and benefit increases or lump sum payments for direct care or ancillary services workers in nursing facilities.

            (a)  The department will determine the lump sum payments, twice a year commencing July 1, 2009 2010, and again in six months from that date as a pro rata share of appropriated funds allocated for increases in direct care and ancillary services workers' wages and benefits or lump sum payments to direct care and ancillary services workers.

            (b) through (3) remain the same.

 

AUTH:  53-2-201, 53-6-113, MCA

IMP:  53-2-201, 53-6-101, 53-6-111, 53-6-113, MCA

 

            4.  The Department of Public Health and Human Services (the department) is proposing the amendment of ARM 37.40.307 and 37.40.361 pertaining to Medicaid nursing facility reimbursement.  The proposed amendments are necessary to implement nursing facility reimbursement for state fiscal year 2011.  The department does not have available, at this time, all of the information that will be necessary in order to establish final payment rates for nursing facility providers effective July 1, 2010.

 

The department will provide rate sheets to all providers in advance of the rule hearing, for verification purposes and in order to facilitate comments, when final case mix information and Medicaid utilization data and other details necessary to compute accurate reimbursement rates become available.  These sheets will distribute the funding available in order to meet the department goals for a price based system of reimbursement.

 

As of April 19, 2010, the date this proposed rule amendment is filed with the Secretary of State, there is a projected Montana general fund budget deficit as that term is defined in 17-7-140(3), MCA for state fiscal year 2011.  The Governor has instructed the department and other agencies of state government to implement a general fund spending reduction plan.  As part of the department's spending reduction plan appropriated provider rate increases for state fiscal year 2011 will not be implemented.

 

Funding will continue to be available from House Bill (HB 645), enacted as Chapter 489, Laws of Montana 2009, to provide for a one-time direct care worker wage increase for nursing facility providers.  This direct care wage increase is for direct care and auxiliary staff for the 2011 fiscal year only and continues the funding that was available in fiscal year 2010 for this purpose.

 

The Legislature continued approval for the use of local county matching funds as a source of additional revenue for nursing facility providers through the intergovernmental fund transfer program in order to maintain access to, and the quality of, nursing facility services for fiscal year 2011.

 

For rate year 2011 (July 1, 2010 - June 30, 2011) the nursing facility per diem rate will be computed as follows:

 

            1.  The Medicaid per diem rates will include two components.  The operating component (that includes both operating and capital costs combined), is the same rate for all nursing facilities and represents 80% of the overall price.  The nursing component will be adjusted for individual nursing facility acuity and is 20% of the overall price.

 

            2.  Medicaid per diem rates will be established annually each July 1st.

 

            3.  The minimum data set (MDS) case mix assessment data will be used in the computation of each facility's resident acuity.  Each nursing facility's case mix index (CMI) will be calculated quarterly based upon a set point in time, using the most recent annual or quarterly MDS information.  Nonclassifiable MDS assessments will be excluded from the computation of CMI's during the transition period.  Medicaid case mix for annual rate setting will be based on the most recent four quarter average of Medicaid CMI's for each nursing facility.

 

Provider rate increase

 

Funding from HB 645 will not be available to provide for a rate increase for nursing facility providers.  Rates will be maintained at the 2010 funding level, with changes being made for case mix using updated MDS data and updated Medicaid utilization information for all nursing facilities. 

 

Direct Care Wages

 

Total funding of approximately $5,729,330 will be available to provide for a one-time direct care worker wage increase.  This direct care wage increase is for direct care and auxiliary staff for the 2011 fiscal year only.  This funding will be allocated to facilities using the methodology that was adopted in 2010, as an add-on to the regular per diem rate, and can only be used to provide for worker wage increases.  The department will identify the reporting form that will be used by providers in order to receive this additional funding for wages.  This form will identify which workers will receive these funds, if these funds will be distributed in the form of a stipend or a bonus, or in the form of a wage increase.  These funds are one time only and as such will not be an ongoing reimbursement source after fiscal year 2011.  Providers will need to be aware that any funds put into their wage structure may not be available in future years, after this biennium.

 

Estimated financial /budget impacts

 

These proposed rule changes are necessary to implement nursing facility reimbursement for state fiscal year 2011.

 

The total state and federal funding available for fiscal year 2011 is currently projected at $153,857,508 which is comprised of $17,077,776 in state special revenue, $32,439,604 in state general funds and $104,340,128 in federal funds.  This funding includes $2,981,100 of total funds, $888,368 of state general funds and $2,092,732 of federal funds appropriated for the 2% provider rate increases that was funded in 2010.  Additional funding of lump sum payments to providers for direct care workers, and auxiliary staff of $1,705,049 of general funds and $4,024,281 in federal funds for a total appropriation of $5,729,330 for the nursing facility program is fiscal year 2011.

 

The estimated total funding available for fiscal year 2011 for nursing facility reimbursement is estimated at approximately $186,979,908 of combined state funds and federal funds, including $33,122,400 in patient contributions.  These numbers do not include at-risk provider funds.  Anticipated patient days for state fiscal year 2011 are 1,119,000 using estimates of caseload adopted by the Legislature. 

 

The estimated total funding impact of the one-time payments to "at risk" nonstate governmental providers and other nursing facilities not determined to be "at risk", has been appropriated at $5,565,935 in total funds of which $1,843,131 comes from state special revenue funds and approximately $3,722,804 from federal funding sources.

 

            5.  The department intends the proposed rule changes to be applied effective July 1, 2010.  This date will comply with legislative directives for funding increases for nursing facilities.

 

            6.  Concerned persons may submit their data, views, or arguments either orally or in writing at the hearing.  Written data, views, or arguments may also be submitted to: Rhonda Lesofski, Department of Public Health and Human Services, Office of Legal Affairs, P.O. Box 4210, Helena, Montana, 59604-4210; fax (406) 444-9744; or e-mail dphhslegal@mt.gov, and must be received no later than 5:00 p.m., May 28, 2010.

 

7.  The Office of Legal Affairs, Department of Public Health and Human Services, has been designated to preside over and conduct this hearing.

 

8.  The department maintains a list of interested persons who wish to receive notices of rulemaking actions proposed by this agency.  Persons who wish to have their name added to the list shall make a written request that includes the name, e-mail, and mailing address of the person to receive notices and specifies for which program the person wishes to receive notices.  Notices will be sent by e-mail unless a mailing preference is noted in the request.  Such written request may be mailed or delivered to the contact person in 6 above or may be made by completing a request form at any rules hearing held by the department.

 

9.  An electronic copy of this proposal notice is available through the Secretary of State's web site at http://sos.mt.gov/ARM/Register.  The Secretary of State strives to make the electronic copy of the notice conform to the official version of the notice, as printed in the Montana Administrative Register, but advises all concerned persons that in the event of a discrepancy between the official printed text of the notice and the electronic version of the notice, only the official printed text will be considered.  In addition, although the Secretary of State works to keep its web site accessible at all times, concerned persons should be aware that the web site may be unavailable during some periods, due to system maintenance or technical problems.

 

10.  The bill sponsor contact requirements of 2-4-302, MCA, do not apply.

 

 

 

 

/s/  John Koch                                                /s/  Ann Whiting Sorrell                                

Rule Reviewer                                               Anna Whiting Sorrell, Director

                                                                        Public Health and Human Services

 

Certified to the Secretary of State April 19, 2010.

 

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