Medi-Cal is California's Medicaid program — a public health insurance program that provides needed health care services for low-income families with children, seniors, people with disabilities, foster caregivers, pregnant women and low-income people with specific diseases, such as tuberculosis, breast cancer or HIV/AIDS. Medi-Cal is financed equally by the state and federal governments.
Medi-Cal is California’s Medicaid program — a public health insurance program that provides needed health care services for low-income families with children, seniors, people with disabilities, foster caregivers, pregnant women and low-income people with specific diseases, such as tuberculosis, breast cancer or HIV/AIDS. Medi-Cal is financed equally by the state and federal governments.
The U.S. House of Representatives today passed H.R. 3922, the Championing Healthy Kids Act of 2017, which would extend funding for the Children’s Health Insurance Program (CHIP) for five years. The bill also delays reductions to Medicaid disproportionate share hospital (DSH) payments currently scheduled for federal fiscal years 2018 and 2019. To compensate for the delay, the bill increases DSH cuts scheduled for 2020-24. The bill, which passed the House by a vote of 242-174, will move to the Senate where 60 votes are needed to pass it. Earlier this week, CHA sent a letter supporting the CHIP and Medicaid DSH provisions in this legislation to all members of the California delegation.
A new report from the Kaiser Family Foundation examines recent changes in Medicaid programs across 50 states and the District of Columbia, and highlights policies in place in fiscal year (FY) 2017 as well as those implemented or planned for FY 2018. Findings show that many states continue efforts to expand managed care, move ahead with payment and delivery system reforms, increase provider payment rates and expand benefits and community-based long-term services and supports, despite uncertainty about the program’s future at the federal level. Current trends include Medicaid expansion, continued reliance on provider taxes and managed care organization inclusion of complex populations and behavioral health services. The report also outlines anticipated trends for 2018, such as state waivers to impose premiums and restrict eligibility, growing adoption of Centers for Disease Control & Prevention prescribing guidelines for opioids, and a focus on housing and direct care workforce shortages.
The Centers for Medicare & Medicaid Services (CMS) has released a frequently asked questions document related to the Mental Health and Substance Use Disorder Parity Rule for Medicaid and the Children’s Health Insurance Program (CHIP). In the rule, CMS applied certain provisions of the Mental Health Parity and Addiction Equity Act to insurance coverage for people enrolled in Medicaid managed care organizations, alternative benefit programs and CHIP. The provisions ensure that financial requirements and treatment limitations on mental health and substance use disorder benefits generally are not more restrictive than the requirements and limitations that apply to medical and surgical benefits in these programs. The FAQs outline which benefits are subject to the parity analysis, how to document compliance and whether states should apply non-quantitative treatment limits in certain scenarios.
Provisions of a proposed rule released earlier this year have been finalized, delaying the effective date of the Health Resources and Services Administration final rule addressing ceiling prices and civil monetary penalties in the 340B Drug Pricing Program. The final rule is now scheduled to take effect July 1, 2018. The delay is intended to allow additional time to consider alternative and supplemental regulatory provisions and for additional rulemaking. As previously reported in CHA News, the final rule had been delayed on multiple occasions to allow time to more fully consider the substantial questions of fact, law and policy raised by the rule.
The Centers for Medicare & Medicaid Services (CMS) has updated its instructions for Worksheet S-10. The update, attached, clarifies definitions and instructions for uncompensated care, non-Medicare bad debt, non-reimbursed Medicare bad debt and charity care to include uninsured discounts. It also modifies the calculation relative to uncompensated care costs. The changes are effective for cost reporting years from Oct. 1, 2013, onward. CHA is currently reviewing the revisions and will provide members with more detail in the coming weeks.
In addition, CMS has extended the deadline for hospitals to revise and submit amended cost reports for federal fiscal years (FFY) 2014 and 2015 from Sept. 30 to Oct. 31. CHA urges members to review Worksheet S-10 of their FFY 2014 and 2015 cost reports and submit amendments to their respective Medicare administrative contractors before the Oct. 31 deadline. More information is available in the attached MLN Matters article.
The California Department of Health Care Services (DHCS) has issued frequently asked questions that detail how the Deferred Action for Childhood Arrivals (DACA) rescission at the federal level impacts Medi-Cal eligibility for existing DACA recipients in California. In its FAQ, DHCS clarifies that there will be no changes to the Medi-Cal coverage for DACA recipients (adults or children) in California. Under existing Medi-Cal policy, individuals in a deferred action status category continue to be eligible for state-funded, full scope Medi-Cal if they otherwise meet all other Medi-Cal program eligibility requirements. Therefore, individuals with DACA status will not have their health coverage impacted unless they have other changes in their eligibility status (e.g., increase in income, no longer residing in California, etc.).
The California Department of Health Care Services (DHCS) has issued a plan for transitioning Medi-Cal eligible patients, now served by three state developmental centers that the state is closing, into Medi-Cal managed care plans (MCPs). The state Department of Developmental Services (DDS) is in the process of closing Sonoma Developmental Center (DC), Fairview DC and General Treatment Area of Porterville DC. Some of the state’s most vulnerable individuals, who have unique and often complex medical needs, reside in the areas of these three DCs. DHCS and DDS are coordinating efforts to provide a smooth transition for these individuals.
DHCS, in collaboration with DDS, will assist beneficiaries in making a choice of managed care plan, when applicable, and maintaining services currently provided by the DCs. DHCS will work closely with managed care plans and DDS to continue medically necessary covered services by establishing transition requirements for contractors congruent with existing policies and procedures. DDS will work with the regional centers and DCs to provide services in accordance with each person’s individual program plan.
A new report from the Kaiser Family Foundation (KFF) analyzes recent congressional debate over the future of Medicaid, establishing lessons learned and outlining what to watch for as Congress returns to session. According to KFF, more than half of states have a strong stake in continuing the Affordable Care Act’s Medicaid expansion, which has provided coverage to millions of low-income residents and has broad support – particularly among the special populations that rely on the program.
Additionally, the report notes that financing caps through a block grant or per capita cap may not be a good deal for many states. Although most states favor enhanced flexibility, uncertain future health care costs and needs as well as variation across states make it difficult to implement a pre-set growth rate for Medicaid under a capped financing structure. Looking to the future, KFF anticipates further activity related to health care legislation, administrative actions and other initiatives, all of which might significantly impact the Medicaid program.
In a recent bulletin, the Centers for Medicare & Medicaid Services (CMS) announced it has authorized Noridian, California’s Medicare administrative contractor, to conduct the targeted probe and educate (TPE) pilot review process required for providers targeted by medical review. The TPE process includes three rounds of a prepayment probe review with provider education. If high denials continue after the first three rounds, Noridian will refer the provider and results to CMS. CMS will determine additional action, which may include extrapolation, referral to the zone program integrity contractor (ZPIC) or referral to recovery audit contractor.
If selected for this review, providers would not be excluded from other medical review activities, such as automated reviews, comparative billing reports, mandated demand bill reviews, other pilot review strategies as directed by CMS or other contractor reviews. Additionally, Noridian will continue to work with other CMS contractors and collaborate with referrals to quality integrity organizations for concern of quality care, ZPIC for concerns related to potential fraud/abuse, and recovery audit contractors for collaboration of vulnerability and to ensure no duplication of reviews.
The California Department of Public Health has issued the attached All Facilities Letter notifying certified Medicare and Medicaid nursing facilities that an updated California Minimum Data Set (MDS) 3.0 Section S form is now available. The form, which will take effect Oct. 1, reflects changes on the California Physician Orders for Life Sustaining Treatment form dated January 2016. MDS Section S completion is required for MDS comprehensive assessments, quarterly assessments, discharge assessments and tracking records. Facilities are not required to complete Section S for Medicare Part A prospective payment system assessments.
The Centers for Medicare & Medicaid Services’ (CMS’) federal fiscal year (FFY) 2018 inpatient prospective payment system final rule establishes changes to fund distribution for Medicare disproportionate share hospital (DSH) uncompensated care (UCC) payments. CMS determined that it will phase-in payments based on information collected from Line 30 on the S-10 Worksheet of the Medicare cost report to determine the UCC payment factor, starting with FFY 2014 cost reports for DSH UCC payments in FFY 2018.
As previously reported in CHA News, hospitals may submit revisions to Worksheet S-10 of their Medicare cost report for FFYs 2014 and 2015. CHA urges members to review Worksheet S-10 of their FFY 2014 and 2015 cost reports and submit amendments to their respective Medicare administrative contractors before the Oct. 31 deadline.
A three-judge panel of the U.S. Ninth Circuit Court of Appeals Monday released its decision that a 10 percent Medi-Cal outpatient fee-for-service rate cut, imposed by California from July 2008 through February 2009, was illegal because the state did not demonstrate that Medi-Cal patients’ access to services was equivalent to that of other patients. The 10 percent cut was replaced by a 1 percent cut in March 2009; in April of that year the Hospital Fee Program took effect, allowing hospitals to obtain reimbursement rates at or near the federal maximum.
CHA challenged the rate cut in 2008, and ultimately settled it as part of an overarching settlement involving other rate cases. However, a group of hospitals represented by a different law firm had separate litigation filed challenging the hospital outpatient rates, and continued with their case; these hospitals were deemed to have opted out of the CHA settlement. The case was sent back to the district court for further proceedings consistent with the Ninth Circuit’s opinion, which could range from issuing an order enjoining the state from implementing the rate cut to giving the government another opportunity to show that equal access existed. Regardless of the ultimate outcome, the decision is helpful to providers as it requires the state Medicaid agency to demonstrate equivalent access to care between Medi-Cal and other patients.
The Centers for Medicare & Medicaid Services (CMS) has released two new forms for providers’ use. The first form relates to electronic funds transfers, and is required to be completed by all Medicare Part A providers who are enrolling or revalidating, or who have changes to their employer identification number, pay-to address or legal business same. The second form released by CMS is an updated Advance Beneficiary Notice of Noncoverage; providers were required to begin using this form June 21. Any new notices submitted on the old form after June 21 will be considered invalid, and will result in provider liability if Medicare denies the claim.
Noridian, the Medicare administrative contractor for California, encourages providers to submit redetermination requests and associated documentation through its online portal, a faster option that also prevents requests from being dismissed for lack of signature. Additionally, providers may access decision letters immediately through the portal.
Noridian also announced that HMS Federal Solutions launched the new Region 4 recovery audit website, which provides information providers may use to prepare if selected as part of any new issue reviews.
On July 19, the California Department of Health Care Services (DHCS) finalized its Medicaid Managed Care Final Rule: Network Adequacy Standards. The document outlines California’s network standards that conform to the network adequacy provisions of the Medicaid managed care and Children’s Health Insurance Program (CHIP) managed care final rule, as well as DHCS’ approach and rationale for determining California’s standards. To strengthen access to services in a managed care network, the final rule requires states to establish network adequacy standards in Medicaid managed care for key types of providers, while giving states flexibility to set the actual standards. The final rule requires that states:
Develop and implement time and distance standards for primary and specialty care (adult and pediatric), behavioral health (adult and pediatric), OB/GYN, pediatric dental, hospital and pharmacy providers, and long-term services and supports (LTSS) that require the beneficiary to travel to the provider
Develop and implement timely access standards for LTSS for providers who travel to the beneficiary to provide services
Assess and certify the adequacy of a managed care plan’s provider network at least annually
The Centers for Medicare & Medicaid Services (CMS) has issued the attached proposed rule implementing reductions to Medicaid disproportionate share hospital (DSH) allotments, as required by the Affordable Care Act, beginning in federal fiscal year (FFY) 2018 through 2025. CMS proposes to establish the DSH Health Reform Methodology (DHRM) to generate a state-specific DSH allotment reduction. The proposal’s illustration of the DHRM’s impact reflects a reduction to California of more than $153 million for FFY 2018. CHA, along with the statewide DSH Task Force, will analyze the proposed rule and provide members with additional details in the coming weeks. Comments on the proposed rule are due Aug. 28.
The California Department of Health Care Services (DHCS) has announced it will submit State Plan Amendment (SPA) 17-030 to the Centers for Medicare & Medicaid Services (CMS) to authorize a time-limited supplemental payment program for selected physician services. These services include new and established patient office/outpatient visits, psychiatric diagnostic evaluations, psychiatric diagnostic evaluation with medical services and psychiatric pharmacological management services. The supplemental payment amounts are fixed and will be paid per claim, according to the current procedural terminology (CPT) codes below:
99202, 99212, 99213
99203, 99204, 99214, 99215
The payments are being made through the California Healthcare, Research and Prevention Tobacco Tax Act (Proposition 56), which increases the excise tax rate on cigarettes and tobacco products. Under Prop. 56, a specified portion of the tobacco tax revenue is allocated to DHCS for the nonfederal share of health care expenditures in accordance with the annual state budget process.
Manatt Health has developed a report for the California Health Care Foundation examining the impact proposed financing changes would have on Medi-Cal, the state’s Medicaid program. Developed in response to the per capita cap proposed under the Senate’s Better Care Reconciliation Act, the report finds:
California is projected to lose $37.6 billion in federal funding between fiscal years 2020 and 2027.
The actual impact will depend on the trend rates for the cap. If they turn out to be even slightly lower than expected, cuts will compound quickly.
A cap locks California into its relatively low Medi-Cal spending levels and puts the state at risk for unexpected health care costs.
A cap would pose major operational issues for California, including the need to make Medi-Cal and budget decisions prior to knowing the amount of federal funds available to the state.
To compensate for such a cap, the state will need to raise taxes, cut other programs, significantly reduce Medi-Cal expenditures or implement some combination of all of these measures.
The California Health Care Foundation has released data on Medi-Cal enrollment of seniors and people with disabilities, who represent about 15 percent of the program’s nearly 14 million enrollees. The data provide a county-by-county overview of enrollment and reflect variation ranging from 65 people in Alpine County to 637,304 in Los Angeles County. The program covers half of all Californians with disabilities, as well as close to a quarter of the state’s seniors.
Medi-Cal enrollees with disabilities include those with conditions such as multiple sclerosis, epilepsy and blindness; HIV/AIDS; spinal cord and traumatic brain injuries; disabling mental health conditions such as depression and schizophrenia; intellectual and developmental disabilities such as Down syndrome and autism; and other functional limitations. The program’s long-term care for seniors covers three of five nursing home residents in the state.
The California Health Care Foundation has released a report illustrating the breadth of Medi-Cal coverage — and the benefits of that coverage — to the program’s nearly 14 million Medi-Cal members across the state. The report’s sources include the California Health Interview Survey; studies by the Kaiser Family Foundation, Bay Area Economic Institute, and New England Journal of Medicine; local Medi-Cal managed care plan data; and more.
Key facts include:
62 percent of those covered by Medi-Cal are families with children.
Medi-Cal covers more than one in five California seniors and one in two people with disabilities.
Medi-Cal covers three in five nursing facility residents.
Two in three adult Medi-Cal members are in the labor force.
Nearly 80 percent of Californians with Medi-Cal report having a usual source of care (vs. 52 percent of the uninsured).
Californians with Medi-Cal are 38 percent more likely to receive routine checkups than the uninsured.