Notice of Development of Rulemaking

AGENCY FOR HEALTH CARE ADMINISTRATION
Medicaid
RULE NO: RULE TITLE
59G-6.030: Payment Methodology for Outpatient Hospital Services
PURPOSE AND EFFECT: The purpose and effect of the proposed rule development is to incorporate changes to the Florida Title XIX Outpatient Hospital Reimbursement Plan in accordance with House Bill 5001, 2010-2011 General Appropriations Act, Specific Appropriation 194, and to address a series of cost report issues.
1. The Agency shall implement a recurring methodology in the Title XIX Outpatient Hospital Reimbursement Plan to achieve a $54,791,389 rate reduction. In establishing rates through the normal process, prior to including this reduction, if the unit cost is equal to or less than the unit cost used in establishing the budget, then no additional reduction in rates is necessary. In establishing rates through the normal process, prior to including this reduction, if the unit cost is greater than the unit cost used in establishing the budget, then rates shall be reduced by an amount required to achieve this reduction, but shall not be reduced below the unit cost used in establishing the budget. Hospitals that are licensed as a children’s specialty hospital and whose Medicaid days plus charity care days divided by total adjusted patient days equals or exceeds 30 percent and rural hospitals as defined in Section 395.602, Florida Statutes, are excluded from this reduction.
2. Elimination the outpatient reimbursement ceilings for hospitals whose charity care and Medicaid days as a percentage of total adjusted hospital days equals or exceeds 11 percent. For any public hospital or any leased public hospital found to have sovereign immunity or hospital with graduate medical education positions that does not qualify for the elimination of the outpatient ceilings, such hospitals shall be exempt from the outpatient reimbursement ceilings. The agency shall use the average of the 2003, 2004 and 2005 audited DSH data available as of March 1, 2009. In the event the agency does not have the prescribed three years of audited DSH data for a hospital, the agency shall use the average of the audited DSH data for 2003, 2004 and 2005 that are available. Any hospital that was exempt from the outpatient reimbursement ceiling in the prior state fiscal year, due to their charity care and Medicaid days as a percentage to total adjusted hospital days equaling or exceeding 11 percent, but no longer meet the 11 percent threshold, because of updated audited DSH data shall remain exempt from the outpatient reimbursement ceilings for a period of two years.
3. Elimination of the outpatient reimbursement ceilings for hospitals that have a minimum of ten licensed Level II Neonatal Intensive Care Beds and are located in Trauma Services Area 2.
4. Elimination the outpatient reimbursement ceilings for hospitals whose Medicaid days, as a percentage of total hospital days, exceed 7.3 percent, and are designated or provisional trauma centers. This provision shall apply to all hospitals that are designated or provisional trauma centers on July 1, 2010 or become a designated or provisional trauma center during Fiscal Year 2010-2011. Included in these funds are the annualized amounts to offset the reductions taken against certified trauma centers as identified in section 13, Chapter 2007-326, Laws of Florida. The agency shall use the average of the 2003, 2004 and 2005 audited DSH data available as of March 1, 2009. In the event the agency does not have the prescribed three years of audited DSH data for a hospital, the agency shall use the average of the audited DSH data for 2003, 2004 and 2005 that are available.
5. $12,226,583 is provided to buy back the Medicaid trend adjustment that is being applied against the Medicaid outpatient rates for the following three categories of hospitals:
• $3,372,389 is provided to the first category of hospitals, which are those hospitals that are part of a system that operate a provider service network in the following manner:
$570,978 is for Jackson Memorial Hospital;
$458,668 is for hospitals in Broward Health;
$840,958 is for hospitals in the Memorial Healthcare System;
$256,166 to Shands Jacksonville and
$1,245,619 to Shands Gainesville.
In the event that the above amounts exceed the amount of the Medicaid trend adjustment applied to each hospital, then the excess funds will be used to buy back other Medicaid reductions in the outpatient rate.
• $4,221,468 shall be used for the second category of hospitals to buy back the Medicaid trend adjustment that is being applied against the Medicaid outpatient rates for those hospitals that are licensed as a children’s specialty hospital and whose Medicaid days plus charity care days divided by total adjusted patient days equals or exceeds 30 percent. In the event that the above amounts exceed the amount of the Medicaid trend adjustment applied to each hospital, then the excess funds will be used to buy back other Medicaid reductions in the outpatient rate.
• $4,632,726 shall be used for the third category of hospitals to buy back the Medicaid trend adjustment that is being applied against the Medicaid outpatient rates for rural hospitals. In the event that the funds under this category exceed the amount of the Medicaid trend adjustment, then any excess funds will be used to buy back other Medicaid reductions in the outpatient rate for those individual hospitals.
The Agency shall use the average of 2003, 2004 and 2005 audited DSH data available as of March 1, 2009. In the event the agency does not have the prescribed three years of audited DSH data for a hospital, the agency shall use the average of the audited DSH data for 2003, 2004 and 2005 that are available.
6. $66,317,949 is provided for public hospitals, including any leased public hospital found to have sovereign immunity, teaching hospitals as defined in Section 408.07(45) or 395.805, Florida Statutes, which have seventy or more full-time equivalent resident physicians, hospitals with graduate medical education positions that do not otherwise qualify, and designated trauma hospitals to buy back the Medicaid outpatient trend adjustment applied to their individual hospital rates and other Medicaid reductions to their outpatient rates up to actual Medicaid outpatient cost.
7.a) Hospitals may buy back the Medicaid outpatient trend adjustment applied to their individual hospital rates and other Medicaid reductions to their outpatient rates up to actual Medicaid outpatient cost.; and
b) $15,000,000 is provided for exemptions from outpatient reimbursement limitations for any hospital that has local funds available for intergovernmental transfers, not elsewhere qualifying for an exemption. The agency shall not include the funds described in this paragraph for the buy back of reductions to outpatient hospital rates in the calculation of capitation rates for Health Maintenance Organizations unless the nonfederal share is provided through grants and donations from state, county or other governmental funds. This section of proviso does not include the buy back of the Medicaid inpatient trend adjustment applied to the individual state mental health hospitals.
8. Clarifying the definition of late cost report and acceptance procedures.
9. New policies regarding resubmissions of cost reports by providers.
10. Development of a sanction process (possibly a daily fine) for late cost reports including reimbursement at the lowest per diem by class.
11. Development of new policies and procedures regarding AHCA’s ability to recoup overpayments.
12. AHCA will reserve the right to submit any provider found to be out of compliance with any of the new policies and procedures regarding cost reports to the Bureau of Medicaid Program Integrity for investigations.
SUBJECT AREA TO BE ADDRESSED: July 1, 2010 Outpatient Hospital reimbursement rates and cost report issues.
SPECIFIC AUTHORITY: 409.919 FS.
LAW IMPLEMENTED: 409.908 FS.
IF REQUESTED IN WRITING AND NOT DEEMED UNNECESSARY BY THE AGENCY HEAD, A RULE DEVELOPMENT WORKSHOP WILL BE HELD AT THE DATE, TIME AND PLACE SHOWN BELOW:
TIME AND DATE: July 13, 2010, 10:00 a.m. – 11:00 a.m.
PLACE: Agency for Health Care Administration, 2727 Mahan Drive, Building 3, Conference Room C, Tallahassee, FL 32308
THE PERSON TO BE CONTACTED REGARDING THE PROPOSED RULE DEVELOPMENT AND A COPY OF THE PRELIMINARY DRAFT, IF AVAILABLE, IS: Edwin Stephens, Medicaid Program Analysis, Agency for Health Care Administration, 2727 Mahan Drive, Building 3, Room 2149-A, Tallahassee, Florida 32308, (850)412-4077 or edwin.stephens@ahca.myflorida.com

THE PRELIMINARY TEXT OF THE PROPOSED RULE DEVELOPMENT IS NOT AVAILABLE.