DHS Holds First Public Provider Meeting on Medicaid Reimbursement Methods of Implementation

The Department of Health Services (DHS) – Division of Medicaid Services Nursing Home Rate Setting Division held its first public Methods of Implementation meeting of 2020 this afternoon via Skype. The meeting addressed acuity specific billing, PDPM implications, COVID-19 updates and several proposed policy changes from the Department.

The meeting was led by Rene Eastman, Section Chief for the Nursing Home Policy & Rate Setting Division of the Department of Health Services. You can find the all meeting materials here.

Eastman first discussed the updates to the plan to switch to acuity specific billing. There originally was a stakeholder meeting scheduled to begin discussing this in April, but it was postponed and will reconvene sometime in the fall. The tentative date for change this to go into effect is 1/1/2022.

Next Jim Robinson explained implications PDPM is having on the rate setting process. You can find a detailed document in the materials above.

Eastman mentioned that the Wisconsin CARES Provider Payment program will resume accepting applications in September. The methodology for the next round has not yet been determined but financials through at least August will be used to calculate lost revenue and allowable expenses. Eastman also discussed the need to collect additional information from providers during the 2020 cost reporting process to capture COVID-19 related financial data. At this time, they have not decided exactly how this will be done or how the data will be used but it will likely involve a supplementary schedule.

There are a number of proposed changes to the Methods this year. They are:

  • Investment Income Interest Offset – Section 4.53(d)
    • This provision says that allowable interest expense will be reduced by the amount of any investment income of the facility or related entities, including foundations and home offices.
    • Eastman indicated the Department has made the decision to move forward with this change. They will remove the section from the Methods As it currently works, the section is not applied equitably and accurately due to paperwork required.
  • Property Tax Changes
    • PILOT payments
      • In practice these payments are not voluntary as the Methods DHS proposes removing the line that says “voluntary.”
    • Private Room Incentives – Section 6.30
      • There are currently two private room incentives – the basic and replacement incentives. DHS is proposing combing these into one single incentive. The same amount of money would instead be spent on this single incentive.
      • Proposed language is:
        • 20 Private Room Incentive
        • Nursing facilities may receive a Private Room Incentive (PRI) by signing a cost report affidavit stating the facility will not charge Medicaid residents a surcharge for private rooms as allowed under DHS 107.09(4)(k) for the entire rate year. The affidavit must be received prior to the effective date of the incentive unless the Department approves otherwise.
  • The amount of the incentive is determined by taking the facility’s private room percentage less the percentage of non-Medicaid patient days times $X.XX per patient day.
  • For the purposes of calculating this incentive, Medicaid patient days include Medicaid Managed Care and Medicaid Hospice days.

Finally, Robinson addressed preliminary rate modelling. The modelling will not be available until the September meeting, but he explained components that would ultimately contribute to the amount available. First, because there is currently a ban on increases to patient liability, the amount available for funding may be restricted. DHS is still working through this issue and looking for more information or whether the increased FMAP funds could be used to plug this hole. There is also an expected 1.4% increase in acuity this year. Eastman requested feedback from the associations regarding where any available funding should be spent – meaning into which cost center. WHCA/WiCAL will discuss this with the Payment Council and offer feedback to DHS by mid-August.

The next meeting will be held September 4 from 10am-noon via Skype. Connection information is available here.

If you have questions, please contact Director of Reimbursement Policy Kate Dickson.