Senior and Financial Manager’s Retreat September 8-9, 2016 Mohonk Mountain House New Paltz, NY Patrick Conole Senior Vice President Home Care Association of New York State
1 State Medicaid Issues
Minimum Wage Update As part of this year’s 2016-17 final budget the Governor and Legislature reached • agreement of a phase-in $15 per hour minimum wage hike. Under the deal, NYC’s minimum wage will increase to $15 per hour in three years • (beginning on December 31, 2016) and in Long Island and Westchester over six years. For the rest of state, the minimum wage will go up to $12.50 over the next 5 years • and would be indexed to $15 per hour thereafter based on to be determined methodology developed by the Division of Budget. See Minimum Wage Effective Dates Chart in Handouts. • Throughout the entire State Budget process (pre and post final budget), HCA has • been working with a coalition of other State Associations that includes HCP, LeadingAge NY and HANYS to estimate the cost impact of any Minimum Wage policy, as well as to discuss DOH’s rollout of any implementation guidelines given to the MLTCs or other Medicaid Managed Care plans. continued… 2
Minimum Wage Update - continued We have also had regular conference calls with a subgroup of HCA’s LHCSAs members. Included as part of the 2016-17 final budget are Medicaid state-share cash • estimates of $13 million for 2016-17 across all sectors, starting with the January 1, 2017 implementation date of the wage hike to the end of the state fiscal year on March 31 (a three-month period). State officials are also proposing a state-share cash estimates of $88 million for the entire 2017-18 state fiscal year (with the vast majority of these monies dedicated to home care providers). These appropriations are below HCA's projections which account for Medicare • cost impacts and other considerations (compression factor) not included in the state's projections. Jason Helgerson, New York’s Medicaid Director has stated that DOH intends to • have updated Medicaid rates (for Plans and FFS providers) loaded by January 1, 2017 but many details need to be worked out, including the exact methodology of the additional funding and the status of federal-share amounts, which require approval from the U.S. Centers for Medicare and Medicaid Services. 3
Minimum Wage Update - continued Also unknown is the prospect of any future funding under Medicare for wage costs, which Mr. Helgerson said would be the subject of discussions with federal officials. HCA is working with our home care coalition partners (HCP and LeadingAge NY) to make • sure any guidance from the Department will add increased funding for minimum wage compliance uniformly to the MLTC/MMC regional rate and this adjustment will be risk adjusted. DOH’s current minimum wage estimates (for NYC area only) on the expected impact to • worker costs that should be given to contract providers is $1.33 an hour - in order to meet statutory wage requirements (minimum wage and wage parity.) HCA and our home care coalition have calculated a figure of $1.47 an hour that is needed and have shared those estimates with DOH. HCA’s top priority is that any guidance from DOH makes it clear that the plans have to pass • through the entire amount that they receive from DOH to all of their contracted home care providers, that the plans cannot decrease their rates so that home care providers don’t receive the full amount, and home care providers/plans can go to DOH if there is a dispute over the increase. 4
CHHA Episodic Pricing System (EPS) Update DOH implemented CHHA EPS on May 1, 2012. Statute requires the Department • to rebase the EPS, no less than every 3 years. On October 1, 2015, DOH implemented a full CHHA EPS rebasing adjustment • (new base year of 2013) which included updated information on the base price, the Medicaid EPS Grouper, Case-Mix score changes, new outlier thresholds, updated LUPA amounts, updated wage indices, etc. As part of the 2015-16 final state budget, DOH allocated a CHHA EPS rebasing • savings of $30 million (gross) in the State Fiscal Plan however, the actual rebasing adjustment is producing savings anywhere from $70-100 million. The current EPS base price was lowered to $3,629 from the old base price of $5,633 – which represents a 35.6 percent reduction. continued… 5
CHHA Episodic Pricing System (EPS) - continued In fact, an analysis of CHHA EPS reimbursement from August 2015 thru July • 2016 (compared to the previous 12 month period) shows CHHA EPS reimbursement decreasing to $183.6 million from $248.7 million (represents a 26.2% decrease). Because of the severe magnitude of this CHHA EPS rebasing rate reduction, • HCA developed a bill (S.5878/A.8171) that the Legislature unanimously passed which limits the level of CHHA EPS rebasing cuts to $30 million; however, the Governor vetoed the Legislation. 6
Medicaid Face-to-Face (F2F) Requirement On February 2, 2016, CMS published in the Federal Register a final rule on the • Medicaid F2F requirements for Home Health Services. Can be reviewed at: https://s3.amazonaws.com/public-inspection.federalregister.gov/2016-01585.pdf Effective July 1, 2016, Section 6407 of the ACA, requires a F2F encounter with the • Medicaid beneficiary for the initial authorization of home health services provided by a Certified Home Health Agency (CHHA). However, DOH has stated to HCA that provider compliance and DOH enforcement • with this requirement will not begin until July 1, 2017. DOH has developed draft guidance which HCA has reviewed (See ASAP article • summary in packet). HCA and other Associations met last week with Andrew Segal, DOH’s new • Director of Long Term Care to discuss this issue specifically regarding any flexibility DOH may have in making the requirement less burdensome. We had previously requested that DOH only make it applicable in Medicaid FFS situations, not in any Mainstream Medicaid Managed Care of MLTC type cases. 7
Other State Medicaid Issues Regulatory Changes to Physician Signed Orders - Due to HCA’s advocacy, • DOH issued a May 4, 2016 DAL notifying CHHAs, LTHHCPs and LHCSAs that DOH has amended the home care regulations in Sections 763 and 766 with regards to obtaining signed physician orders. The revised Medicaid regulations are similar to the Medicare regulation in that • providers will have up to a 1 year time period for receipt of the signed orders. However, upon receipt of those orders, providers have 30 days to bill for services. DOH has also issued an article in the August 2016 Medicaid Update on this • issue Standardization of Medicaid Managed care billing / revenue codes - As part • of the 2015-16 final budget DOH was required to do this and HCA has been part of a Workgroup that has developed “draft” rate codes which have been shared with the plan associations. HCA is advocating strongly that implementation of these draft codes begins no later than January 1, 2017. continued… 8
Other State Medicaid Issues - continued Third Party Liability (TPL) Update - The OMIG and UMMS last month sent • provider case selection report letters to many Medicare certified providers that includes a listing of all cases that need to be demand billed to Medicare for the first half of FFY 2016 only. Dates of service for this period include October 1, 2015 thru March 31, 2016. 2% Across the Board (ATB) Medicaid Reduction - Effective May 8, 2015, the • 2 percent ATB Medicaid payment reduction was eliminated for claims with service dates on or after April 1, 2015. However, the retroactive repayment of the reduction taken over the period April 1, 2014 through March 31, 2015 is still pending federal approval from CMS. 9
10 Federal/Medicare Issues
CMS’s Proposed CY 2017 HH PPS On July 5, 2016, CMS published in the Federal Register the proposed rule for the • CY 2017 Medicare Home Health PPS. HCA provided the membership with a detailed Public Policy Memorandum on • CMS’s proposed rule (in handouts) which can be accessed at: http://hca- nys.org/wp-content/uploads/2016/06/HCAMemoProposed2017HHPPS.pdf 11
CMS’s 2017 Proposed Rule: Maintains for the fourth year the -3.5 rebasing methodology first implemented in • the CY 2014 HH PPS ($80.95 reduction to the base rate). Maintains for the second year an additional “Case-Mix Creep” type adjustment • that would reduce the 60-day episodic payment by 0.97 percent first implemented in 2016 and continuing for CY 2017 and 2018, to account for a CMS-contended growth in “nominal” case-mix ($160 million decrease). Includes a proposed market basket update of 2.3 percent (a $420 million • increase). CMS determined this percentage by subtracting a mandated 0.5 percent productivity adjustment from its calculation of a 2.8 percent market basket. Results in an overall 1.0 percent reduction in Medicare home health payments • nationally (or $180 million) in CY 2017. Continued… 12
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