Title of Regulation: 12VAC30-80. Methods and Standards for Establishing Payment Rates; Other Types of Care (amending 12VAC30-80-110).

Statutory Authority: § 32.1-325 of the Code of Virginia; 42 USC § 1396 et seq.

Public Hearing Information: No public hearings are scheduled.

Public Comment Deadline: September 7, 2016.

Effective Date: September 22, 2016.

Agency Contact: Emily McClellan, Regulatory Supervisor, Department of Medical Assistance Services, 600 East Broad Street, Suite 1300, Richmond, VA 23219, telephone (804) 371-4300, FAX (804) 786-1680, or email emily.mcclellan@dmas.virginia.gov.

Basis: Section 32.1-325 of the Code of Virginia grants to the Board of Medical Assistance Services the authority to administer and amend the Plan for Medical Assistance, and § 32.1-324 of the Code of Virginia authorizes the Director of the Department of Medical Assistance Services (DMAS) to administer and amend the Plan for Medical Assistance according to the board's requirements. The Medicaid authority as established by § 1902(a) of the Social Security Act (42 USC § 1396a) provides governing authority for payments for services.

Purpose: The purpose of this action is to incorporate into the Virginia Administrative Code the current reimbursement practices for targeted case management. The reimbursement methodologies were required and approved by the Centers for Medicare and Medicaid Services (CMS) effective September 10, 2013, and have been in place since that time.

In addition, references to community mental health services that used to include targeted case management, but no longer do, have been removed to correct a conflict between the community mental health regulations and the case management regulations. These regulations protect the health, safety, and welfare of the public in that they clarify reimbursement for targeted case management services that coordinate health care for high risk pregnant women, infants, and children; individuals with serious mental illness; and individuals with intellectual or developmental disabilities.

Rationale for Using Fast-Track Rulemaking Process: This regulatory action is being promulgated as a fast-track action because it is expected to be noncontroversial. The reimbursement practices contained in this regulation have been in place since September 2013 and were required and approved by CMS.

Substance: Currently, the Virginia Administrative Code does not include information on reimbursement practices for targeted case management for (i) high risk pregnant women, infants, and children up to age two years; (ii) seriously mentally ill adults, emotionally disturbed children, or youth at risk of serious emotional disturbance; (iii) individuals with intellectual disability; and (iv) individuals with developmental disability.

This regulatory action describes the reimbursement practices for each of these types of targeted case management. The regulations contain a description of how reimbursement for each service is calculated, a description of the unit of service, a statement that private and governmental providers are reimbursed according to the same methodology, a prohibition of billing of overlapping case management services, and a requirement for providers to maintain information to support future rate updates. Including this information in the Virginia Administrative Code will make these reimbursement practices transparent to Medicaid providers, Medicaid members, and the public.

In addition, references to community mental health services that used to include targeted case management, but no longer do, have been removed to correct a conflict between the community mental health regulations and the case management regulations.

Issues: The primary advantage of this regulatory action is that it will make current DMAS reimbursement practices for targeted case management transparent to Medicaid providers, Medicaid members, and the public. The changes will also remove a conflict between community mental health regulations and targeted case management regulations. This regulatory action does not create any disadvantages to the public, the agency, or the Commonwealth, as it does not change reimbursement practices that have been in effect since September 2013.

Department of Planning and Budget's Economic Impact Analysis:

Summary of the Proposed Amendments to Regulation. The proposed regulation will clarify reimbursement methodology for targeted case management for certain groups and remove obsolete language.

Result of Analysis. The benefits likely exceed the costs for all proposed changes.

Estimated Economic Impact. Prior to September 2013, the Centers for Medicare and Medicaid Services (CMS) required the Department of Medical Assistance Services (DMAS) to specifically address the reimbursement methodology for targeted case management for high risk pregnant women, infants, and children up to age two; seriously mentally ill adults, emotionally disturbed children, and youth at risk of serious emotional disturbance; and individuals with intellectual or developmental disability. DMAS adopted specific language in the state plan reflecting the reimbursement methodologies for these groups and CMS approved the changes on September 10, 2013. The changes requested by CMS simply clarified then existing methodology in practice and had no effect on reimbursement rates. DMAS now proposes to incorporate the specific language that has been in the state plan and that has been followed in practice since 2013 into the regulation. Thus, no significant economic effect is expected other than improving the clarity of the regulation.

In addition, the proposed changes will remove obsolete references to community mental health services in the targeted case management section. The community mental health services and regulations included targeted case management in the past, but both the services and regulations have been amended to remove those references on January 30, 2015.¹ However, the references to targeted case management have been inadvertently left in the current regulation. The obsolete references to community mental health services are now being removed from these case management regulations to remove the conflict between the sections. This change is also not expected to create any significant economic effect other than improving the clarity of the regulation.

Businesses and Entities Affected. The providers of targeted case management include Virginia Department of Health, 40 Community Services Boards, and approximately 98 private support coordinators.

Localities Particularly Affected. The proposed changes apply statewide.

Projected Impact on Employment. No impact on employment is expected.

Effects on the Use and Value of Private Property. No impact on the use and value of private property is expected.

Real Estate Development Costs. No impact on real estate development costs is expected.

Small Businesses:

Definition. Pursuant to § 2.2-4007.04 of the Code of Virginia, small business is defined as "a business entity, including its affiliates, that (i) is independently owned and operated and (ii) employs fewer than 500 full-time employees or has gross annual sales of less than $6 million."

Costs and Other Effects. Most of the support coordinators are small providers. The proposed amendments do not impose costs on them but will benefit them by improving the clarity of the regulation.

Alternative Method that Minimizes Adverse Impact. No adverse impact on small businesses is expected.

Adverse Impacts:

Businesses. The proposed amendments do not have an adverse impact on non-small businesses.

Localities. The proposed amendments will not adversely affect localities.

Other Entities. The proposed amendments will not adversely affect other entities.

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¹See http://townhall.virginia.gov/l/ViewStage.cfm?stageid=6536

Agency's Response to Economic Impact Analysis: The agency has reviewed the economic impact analysis prepared by the Department of Planning and Budget. The agency concurs with this analysis.

Summary:

The amendments incorporate the reimbursement methodology for targeted case management for (i) high risk pregnant women, infants, and children up to age two years; (ii) seriously mentally ill adults, emotionally disturbed children, or youth at risk of serious emotional disturbance; (iii) individuals with intellectual disability; and (iv) individuals with developmental disability. The amendments also remove obsolete references to community mental health services to resolve a conflict between the community mental health regulations and the case management regulations.

12VAC30-80-110. Fee-for-service: case management.

A. Targeted case management for high-risk pregnant women and infants up to two years of age, for community mental health and intellectual disability services, and for individuals who have applied for or are participating in the Individual and Family Developmental Disability Support Waiver program (IFDDS Waiver) shall be reimbursed at the lowest of: state agency fee schedule, actual charge, or Medicare (Title XVIII) allowances.

B. A. Targeted case management for early intervention (Part C) children.

1. Targeted case management for children from birth to three years of age who have developmental delay and who are in need of early intervention is reimbursed at the lower of the state agency fee schedule or the actual charge (charge to the general public). The unit of service is monthly one month. All private and governmental fee-for-service providers are reimbursed according to the same methodology. The agency's rates are effective for services on or after October 11, 2011. Rates are published on the agency's website at www.dmas.virginia.gov.

2. Case management shall not be billed when it is an integral part of another Medicaid service including, but not limited to, intensive community treatment services and intensive in-home services for children and adolescents.

3. 2. Case management defined for another target group shall not be billed concurrently with this case management service except for case management services for high risk infants provided under 12VAC30-50-410. Providers of early intervention case management shall coordinate services with providers of case management services for high risk infants, pursuant to 12VAC30-50-410, to ensure that services are not duplicated.

4. 3. Each entity receiving payment for services as defined in 12VAC30-50-415 shall be required to furnish the following to DMAS, upon request:

a. Data, by practitioner, on the utilization by Medicaid beneficiaries of the services included in the unit rate; and

b. Cost information used by practitioner.

5. 4. Future rate updates will be based on information obtained from the providers. DMAS monitors the provision of targeted case management through post-payment review (PPR). PPRs ensure that paid services were rendered appropriately, in accordance with state and federal policies and program requirements, provided in a timely manner, and paid correctly.

B. Reimbursement for targeted case management for high risk pregnant women and infants and children.

1. Targeted case management for high risk pregnant women and infants up to two years of age defined in 12VAC30-50-410 shall be reimbursed at the lower of the state agency fee schedule or the actual charge (charge to the general public). The unit of service is one day. All private and governmental fee-for-service providers are reimbursed according to the same methodology. The agency's rates were set as of September 10, 2013, and are effective for services on or after that date. Rates are published on the agency's website at www.dmas.virginia.gov.

2. Case management may not be billed when it is an integral part of another Medicaid service.

3. Case management defined for another target group shall not be billed concurrently with the case management service under this subsection except for case management for early intervention provided under 12VAC30-50-415. Providers of case management for high risk pregnant women and infants and children shall coordinate services with providers of early intervention case management to ensure that services are not duplicated.

4. Each provider receiving payment for the service under this subsection will be required to furnish the following to the Medicaid agency, upon request:

a. Data on the hourly utilization of this service furnished to Medicaid members; and

b. Cost information used by practitioners furnishing this service.

5. Rate updates will be based on utilization and cost information obtained from the providers.

C. Reimbursement for targeted case management for seriously mentally ill adults and emotionally disturbed children and for youth at risk of serious emotional disturbance.

1. Targeted case management services for seriously mentally ill adults and emotionally disturbed children defined in 12VAC30-50-420 or for youth at risk of serious emotional disturbance defined in 12VAC30-50-430 shall be reimbursed at the lower of the state agency fee schedule or the actual charge (charge to the general public). The unit of service is one month. All private and governmental fee-for-service providers are reimbursed according to the same methodology. The agency's rates were set as of September 10, 2013, and are effective for services on or after that date. Rates are published on the agency's website at www.dmas.virginia.gov.

2. Case management for seriously mentally ill adults and emotionally disturbed children and for youth at risk of serious emotional disturbance may not be billed when it is an integral part of another Medicaid service.

3. Case management defined for another target group shall not be billed concurrently with the case management services under this subsection.

4. Each provider receiving payment for the services under this subsection will be required to furnish the following to the Medicaid agency, upon request:

a. Data on the hourly utilization of these services furnished to Medicaid members; and

b. Cost information used by the practitioner furnishing these services.

5. Rate updates will be based on utilization and cost information obtained from the providers.

D. Reimbursement for targeted case management for individuals with intellectual disability or developmental disability.

1. Targeted case management for individuals with intellectual disability defined in 12VAC30-50-440 and individuals with developmental disabilities defined in 12VAC30-50-450 shall be reimbursed at the lower of the state agency fee schedule or the actual charge (the charge to the general public). The unit of service is one month. All private and governmental fee-for-service providers are reimbursed according to the same methodology. The agency's rates were set as of September 10, 2013, and are effective for services on or after that date. Rates are published on the agency's website at www.dmas.virginia.gov

2. Case management for individuals with intellectual disability or developmental disability may not be billed when it is an integral part of another Medicaid service.

3. Case management defined for another target group shall not be billed concurrently with the case management service under this subsection.

4. Each provider receiving payment for the service under this subsection will be required to furnish the following to the Medicaid agency, upon request:

a. Data on the hourly utilization of this service furnished to Medicaid members; and

b. Cost information by practitioners furnishing this service.

5. Rate updates will be based on utilization and cost information obtained from the providers.