NOTICES
Change in Methods and Standards of Setting Payment Rates
[33 Pa.B. 3052] The purpose of this announcement is to provide advance notice that the Department of Public Welfare (Department) intends to make changes in its methods and standards for payment of Medical Assistance (MA) nursing facility services beginning in Fiscal Year (FY) 2003-2004.
Background
The Commonwealth budget for MA long-term care services for FY 2003-2004 assumes that $320 million will be derived from State revenue collected from an assessment on nursing homes and the Federal funds drawn down as a match for the State assessment revenue.
To impose the assessment and collect the anticipated State revenues necessary for the Federal match, legislation must be enacted. Without legislation authorizing the assessment, the Department has determined there will be insufficient funds available to make payments to nursing facilities in accordance with the existing payment methodology set forth in 55 Pa. Code Chapter 1187 (relating to nursing facility services) throughout FY 2003-2004. Absent the availability of revenue necessary to address the funding shortfall, the Department intends to publish a final-omitted rulemaking under section 6 of the Regulatory Review Act (71 P. S. § 745.6) and to submit a State Plan amendment to the Federal Centers for Medicare & Medicaid Services changing the case-mix payment methodology. Under section 6(d) of the Regulatory Review Act, the amendments will take effect immediately upon publication in the Pennsylvania Bulletin and will remain in effect for 120 days.
Description of Changes
The Department proposes to amend 55 Pa. Code Chapter 1187, case-mix payment system regulations, and amend the Commonwealth's Medicaid State Plan as follows.
Current MA Participating Nursing Facilities
For the rate year that begins on July 1, 2003, each of the four rate components listed in 55 Pa. Code § 1187.96(e) (relating to price and rate setting computations) shall be multiplied by .8788 (or another factor as may be necessary depending upon the effective date of the regulation) and the sum of the resulting products shall be the nursing facility's per diem rate for payments made for nursing facility services rendered on or after the effective date of the regulation.
For purposes of the quarterly adjustments made under 55 Pa. Code § 1187.95(b) (relating to general principles for rate and price setting), after a nursing facility's adjusted resident care component has been computed in accordance with that provision, it shall be multiplied by .8788 (or another factor as may be necessary depending upon the effective date of the regulation) and the facility's per diem rate for that quarter for payments made for nursing facility services rendered on or after the effective date of the regulation shall be the sum of that amount plus the adjusted amount for the other resident care, administrative and capital rate components.
New MA Nursing Facilities
If, during the rate year that begins on July 1, 2003, a nursing facility is a new nursing facility, each rate component that is computed for that facility under 55 Pa. Code § 1187.97(1) (relating to rates for new nursing facilities, nursing facilities with a change of ownership, reorganized nursing facilities, and former prospective payment nursing facilities) shall be multiplied by .8788 (or another factor as may be necessary depending upon the effective date of the regulation) and the sum of the resulting products shall be the facility's per diem rate for payments made for nursing facility services rendered on or after the effective date of the regulation.
If, during the rate year that begins on July 1, 2003, a nursing facility is a new nursing facility and that facility's resident care rate component is adjusted under 55 Pa. Code § 1187.97(1), the adjusted resident care component shall be multiplied by .8788 (or another factor as may be necessary depending upon the effective date of the regulation) and the facility's per diem rate for the applicable quarter for payments made for nursing facility services rendered on or after the effective date of the regulation shall be the sum of that amount plus the sum of the other resident care, administrative and capital rate components multiplied by .8788 (or another factor as may be necessary depending upon the effective date of the regulation).
Fiscal Impact
As a result of this proposed change, the Department estimates that annual aggregate expenditures for MA nursing facility services for FY 2003-2004 will decrease by $320.407 million ($135.500 million in State funds).
Public Comment
Interested persons are invited to submit written comments about the changes to the case-mix payment system to the Department within 30 days of publication of this notice in the Pennsylvania Bulletin. Comments should be addressed to the Department of Public Welfare, Division of Long Term Care Client Services, Attention: Gail Weidman, P. O. Box 2675, Harrisburg, PA 17105. In the absence of the passage of legislation authorizing the Department to impose an assessment or the receipt of comments proposing a viable alternative to collect the necessary revenue, the Department intends to proceed with the publication of the regulations and the submission of the State Plan amendment to make the changes previously described.
Persons with a disability may use the AT&T Relay Service by calling (800) 654-5984 (TDD users) or (800) 654-5988 (voice users).
ESTELLE B. RICHMAN,
SecretaryFiscal Note: 14-NOT-367. No fiscal impact; (8) recommends adoption. This proposed change will result in a decrease in aggregate expenditures in Fiscal Year 2003-2004 of $135.5 million to the Medical Assistance--Long Term Care appropriation.
[Pa.B. Doc. No. 03-1268. Filed for public inspection June 27, 2003, 9:00 a.m.]
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