NOTICES
Rate-Setting Methodology for Consolidated and Person/Family Directed Support Waiver- and Base-Funded Services for Individuals Participating in the Office of Developmental Programs Service System
[44 Pa.B. 4060]
[Saturday, June 28, 2014]The purpose of this notice is to announce the methodology used in the Prospective Payment System to develop rates, effective July 1, 2014, for residential habilitation eligible and transportation trip services, funded through the Consolidated and Person/Family Directed Support waivers and for the same service that is provided with base funding in a waiver-funded service location.
Rate-Setting Methodology for Residential Habilitation Eligible Services
The following methodology applies to the residential habilitation eligible proposed payment rates. In accordance with 55 Pa. Code § 51.72 (relating to cost-based rate assignment), the Fiscal Year (FY) 2014-2015 proposed rates for the residential habilitation eligible services were developed from expenses and utilization data reported in approved Year 6 cost reports (FY 2012-2013 Historical Expense Period), submitted by providers and approved in the desk review process, when the procedure codes and service locations in the cost reports were the same as those entered in the Home and Community Services Information Systems (HCSIS) Services and Supports Directory (SSD) as of December 31, 2013. The FY 2014-2015 residential habilitation eligible proposed rates will be effective for services delivered on or after July 1, 2014, are subject to the adjustments described as follows, and are assigned at the Master Provider Index (MPI)—Service Location Code—Procedure Code/Modifier level based, on the methodology outlined as follows.
Residential Outlier Review Process
The ''total unit cost'' for a provider and service is defined as the total expenses reported in the approved cost report for that provider and service divided by the total available units reported in the approved cost report for that provider and service, including any applicable utilization adjustments based on a review of the cost report data compared to available HCSIS and Provider Reimbursement and Operations Management Information System (PROMISeTM) data.
As required under 55 Pa. Code § 51.74 (relating to approval of a cost-based rate for nontransportation HCBS), the Department identified and adjusted for outliers at the total unit cost level for each of the providers' residential habilitation eligible services submitted in the Year 6 approved cost reports, as applicable. For all residential habilitation eligible services with 20 or more unique unit costs (unit costs by provider and service from separate, approved Year 6 cost reports), the Department applied the following process for each service:
• The average and standard deviation (SD) values were calculated, excluding extreme outliers, based on the total unit costs for all providers from the Year 6 cost report data.
• Total unit costs that were greater than the average plus one SD or were less than the average minus two SD were flagged as outliers.
• Total unit costs that were flagged as outliers were subject to a review, as described as follows.
Total Unit Cost Review
The Department performed a standardized review of all total unit cost outliers. The review consisted of an evaluation of the Individual Support Plans (ISP) for waiver participants receiving services at the service locations impacted by the outlier unit cost. The review allowed the Department to determine whether the outlier unit cost was justified (such as an individual with complex needs) and the following was applied:
• Total unit cost outliers that were supported by the ISP reviews were not adjusted.
• Total unit cost outliers that were greater than the average unit cost plus one SD and that were not supported by the ISP reviews were adjusted to the maximum unit cost from an approved Year 6 cost report below the average plus one SD for that service.
• Total unit cost outliers that were less than the average minus two SD and that were not supported by the ISP reviews were adjusted to the minimum unit cost from an approved Year 6 cost report above the average minus two SD for that service.
For all residential habilitation eligible services with fewer than 20 unique unit costs, the Department did not perform the standardized outlier review on the total unit costs because there were not enough data points available to produce statistically valid ranges. The Department, however, did review the unit costs for these services in an effort to standardize rates across services. The review consisted of a comparison of the following:
• Other unit costs for that service, as applicable.
• The average unit cost and range of unit costs for similar services with 20 or more unit costs.
• The FY 2013-2014 Statewide average unit cost for that service based on FY 2013-2014 approved cost report data.
If based on the review, a unit cost appeared unreasonably high or low; the Department reviewed the ISPs for waiver participants receiving services at the service locations impacted by the high/low unit cost to determine if the unit costs were justified. Adjustments to unit costs were made based on the Department's review of the ISPs.
Vacancy Factor
In accordance with 55 Pa. Code § 51.74, and as done in FY 2012-2013 and FY 2013-2014, a vacancy factor was incorporated into the residential habilitation rates to recognize that providers may not deliver services at full capacity. The vacancy factor adjusts the full capacity rate to account for days when the residential provider cannot bill due to a participant not receiving services. The provider cannot bill for days when a participant is not receiving services, but rather the provider is paid a higher rate for days when the participant is receiving services.
After the unit costs for each residential habilitation eligible service were adjusted through the outlier review process, a single, standardized vacancy factor of 97% was applied to reflect payment to providers for an average number of vacant days. For example, a unit cost of $100 (after the outlier review) would be adjusted to a unit cost of $103.09 ($100/0.97) after the vacancy factor was applied. The single standardized vacancy factor was based on an analysis of historical PROMISeTM utilization data.
Enhanced Communication Services
Effective July 1, 2014, an Enhanced Communication Services modifier will be available for residential habilitation eligible services. The Enhanced Communication Services can be provided to individuals who meet all the following:
• Enrolled in the Consolidated Waiver.
• Deaf.
• Determined to need services that are provided by staff who are proficient in sign language.
Providers seeking the Enhanced Communication Services rate will need to submit a request to the Office of Developmental Programs. The request must include documentation that the provider has sign language proficient staff and can meet the communication needs of individuals who are deaf at all times during services. The Office of Developmental Programs will also review the records of each individual that receives Enhanced Communication Services to ensure that the individual is in need of the service and the provider's current rate to ensure that the provider is not already receiving a rate that includes the increased cost to provide Enhanced Communication Services.
Transportation Trip Services
The FY 2014-2015 proposed rates for transportation trip services were developed from expenses and utilization data reported in the approved Year 6 transportation cost reports that are based on the FY 2012-2013 historical expense period, when the procedure codes submitted by providers are the same as those entered in the SSD as of March 31, 2014. The FY 2014-2015 transportation trip proposed rates will be effective for services delivered July 1, 2014, through June 30, 2015, are subject to the adjustments described as follows, and are assigned at the MPI—Service Location Code—Procedure Code/Modifier level based on the methodology outlined as follows.
Transportation Trip Outlier Review Process
The ''total unit cost'' for a provider and transportation trip service is defined as total expenses reported in the approved transportation cost report for that provider and service divided by the total utilization reported in the approved transportation cost report for that provider and service. The total expenses are equal to Schedule A, Line 12 of the cost report (total net expenses). The total utilization is equal to Schedule A, Line 13 of the cost report. These rates reflect consideration for trips with and without aides (as reported by the provider), which means each provider will be paid one payment rate for each trip service (that is, there will not be separate rates for trips with an aide versus without an aide).
The Department reviewed the development of each transportation trip unit cost submitted in approved transportation cost reports for accuracy, reasonableness and to ensure compliance with the Department's allowable cost policies. To support the Department's efforts to continue to standardize rates for similar services, the Department reviewed unit costs that were at the upper or lower end of the range of unit costs for each transportation trip service. No adjustments were made as a result of the review.
Cost of Living (COLA)
In accordance with 55 Pa. Code § 51.74(9), after the unit costs for each residential habilitation eligible and transportation trip service were adjusted as previously described, a total COLA of 0.00% was applied (0.00% for FY 2012-2013 and 0.00% for FY 2013-2014) to establish each provider's proposed rates for FY 2014-2015 (prior to application of the rate adjustment factor).
Rate Adjustment Factor (RAF)
In accordance with 55 Pa. Code § 51.74(10), the Department performed an analysis of the aggregate projected expenditures compared to the amount proposed to be appropriated for the waiver program, an assessment of the current year's billing trends and an analysis of provider-specific impacts of any potential RAF to determine if an RAF would need to be applied prospectively to the residential habilitation eligible rates. The Department used information from this analysis to determine that an RAF was not necessary for the proposed residential habilitation eligible rates.
Rate Assignment Process
For the FY 2014-2015 residential habilitation eligible and transportation trip services, in accordance with 55 Pa. Code § 51.72, the Department assigned proposed payment rates to providers with approved Year 6 cost reports using the following methodology:
• The provider's cost-based payment rate for existing services and service locations submitted in the cost reports, based on the methodology previously described.
• The average of the provider's cost-based payment rates for an existing service at a new service location if the provider submitted cost report data for that service at other service locations.
• The area adjusted average payment rate calculated based on all approved cost reports for a new service for which the provider did not deliver at any service location in FY 2012-2013.
The Department assigned proposed payment rates to existing providers who do not have approved Year 6 cost reports based on the following methodology:
• The lowest payment rates calculated based on all approved cost reports for an existing service for which the provider delivered at any service location in FY 2012-2013.
• The area adjusted average payment rate calculated based on all approved cost reports for a new service for which the provider did not deliver at any service location in FY 2012-2013.
The Department assigned the area adjusted average rate calculated based on all approved cost reports to new providers who did not provide any cost-based services in FY 2012-2013.
All proposed payment rates for all waiver-funded services are contingent on the final budget enacted by the General Assembly. The proposed payment rates should be used to process claims submitted to the PROMISeTM in electronic format for services provided until a notice announcing final rates is published.
Fiscal Impact
It is anticipated that there will be an approximate cost to the Commonwealth of $29.289 million ($13.788 million State funds) in FY 2014-2015 and subsequent years. A new cost for FY 2014-15, which has been included, is the Enhanced Communication Service for individuals enrolled in the Consolidated Waiver. The total amount for cost-based Enhanced Communication Services was included in the Waiver Appropriation of the Governor's Executive Budget at $3.096 million ($1.479 million State funds). The amount of funding available for this program is dependent upon the funds appropriated by the General Assembly for the forthcoming fiscal year; therefore, until a budget bill is passed and enacted, the fiscal impact associated with this notice is estimated.
Public Comment
Copies of this notice may be obtained at the local Mental Health/Intellectual Disability (MH/ID) County Program, Administrative Entity (AE) or regional Office of Developmental Programs in the corresponding regions:
• Western region: Piatt Place, Room 4900, 301 5th Avenue, Pittsburgh, PA 15222, (412) 565-5144
• Northeast region: Room 315, Scranton State Office Building, 100 Lackawanna Avenue, Scranton, PA 18503, (570) 963-4749
• Southeast region: 801 Market Street, Suite 5071, Philadelphia, PA 19107, (215) 560-2242 or (215) 560-2245
• Central region: Room 430, Willow Oak Building, P. O. Box 2675, DGS Annex Complex, Harrisburg, PA 17105, (717) 772-6507
Contact information for the local MH/ID County Program or AE may be found at https://www.hcsis.state.pa.us/hcsis-ssd/pgm/asp/PRCTY.ASP or contact the previously referenced regional Office of Developmental Programs.
Interested persons are invited to submit written comments regarding this notice to the Department at the Office of Developmental Programs' rate-setting mailbox at ra-ratesetting@state.pa.us, use subject header ''PN PPS Methodology,'' or mail to the Department of Public Welfare, Office of Developmental Programs, Division of Provider Assistance and Rate Setting, 4th Floor, Health and Welfare Building, 625 Forster Street, Harrisburg, PA 17120.
Persons with a disability who require an auxiliary aid or service may submit comments using the Pennsylvania AT&T Relay Service at (800) 654-5984 (TDD users) or (800) 654-5988 (voice users).
BEVERLY D. MACKERETH,
SecretaryFiscal Note: 14-NOT-885. (1) General Fund;
(7) Intellectual Disability—Community Waiver Program; (2) Implementing Year 2014-15 is $13,445,000; (3) 1st Succeeding Year 2015-16 through 5th Succeeding Year 2019-20 are $13,445,000; (4) 2013-14 Program—$1,027,000,000; 2012-13 Program—$931,885,000; 2011-12 Program—$854,863,000;
(7) Intellectual Disability—Community Base Program; (2) Implementing Year 2014-15 is $343,000; (3) 1st Succeeding Year 2015-16 through 5th Succeeding Year 2019-20 are $343,000; (4) 2013-14 Program—$150,918,000; 2012-13 Program—$151,223,000; 2011-12 Program—$158,194,000;
(8) recommends adoption. Funds have been included in the budget to cover this increase.
[Pa.B. Doc. No. 14-1369. Filed for public inspection June 27, 2014, 9:00 a.m.]
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