Federally Qualified Health Centers: Provision and Payment for Dental Services Presented at 54th Annual ADEA Deans’ Conference November 12, 2012 Roger Schwartz National Association of Community Health Centers

What are FQHCs? Grantees under Section 330 of the Public Health Service Act, mostly Section 501(c)(3) tax exempt non-profit entities, but also some public grantees (county health departments, etc.) Covered under FTCA and qualify as a covered entity under the Section 340B drug discount program Defined as FQHCs in the Medicaid and Medicare statute – also includes “look-a-likes” 2 National Association of Community Health Centers

Five Basic Characteristics -  Location in high-need areas: MUAs and HPSAs  Comprehensive health and related services (especially ‘enabling’ services)  Open to all residents, regardless of ability to pay, with charges prospectively set based on income  Governed by community boards, to assure responsiveness to local needs  Held to strict performance/accountability standards for administrative, clinical, and financial operations 3 National Association of Community Health Centers

Community Health Centers Today Largest national network – 22 million + people served, 37% uninsured, 38% Medicaid, 7% Medicare, 63% people of color, 92% low-income individuals – Serve 1 in 5 low-income uninsured and 1 in 7 Medicaid beneficiaries – Number of Medicaid patients served by health centers continues to increase, growing almost twice as fast as number of Medicaid beneficiaries nationally between – Anticipate further Medicaid expansion per ACA in National Association of Community Health Centers

How Health Centers Help to Improve Health and Save Money They reduce hospital and ER use (5.8 fewer admits per 1,000; % fewer ER visits) for their patients Their patients’ overall costs are 24 percent less than those served by other providers, saving $24Billion/yr Their disparities collaboratives are found to reduce health disparities significantly for minority patients While health centers provide care to 14% of all Medicaid beneficiaries, their Medicaid payments make up only 1% of Medicaid spending nationally. 5 National Association of Community Health Centers

Community Health Centers: A Unique & Proven Primary Care Model Access -Serve as health care homes to over 22 million patients in 8,000+ rural and urban underserved communities. -Open to all regardless of insurance status; offer care on sliding-fee scale. -Will reach 40 million people in need by Quality -Medicaid beneficiaries receiving health center care 19% less likely to use emergency department, 11% less likely to be hospitalized for ambulatory care-sensitive conditions than beneficiaries using other providers. -Ensure that all patients receive recommended screenings and health promotion services. Cost-Effectiveness -Save $1,200+ per patient annually in total health care costs. -Drive $24 billion annual savings from reduced emergency, hospital, and specialty care costs, including $6 billion in combined state and federal Medicaid savings. Economic Engine -Generated over $20 billion in total economic benefits for low-income communities in Produced nearly 190,000 jobs that same year. -Will create 284,000 new jobs and generate $54 billion in overall economic benefits by National Association of Community Health Centers

Payment to FQHCs in the Medicaid Program Omnibus Budget Reconciliation Acts of 1989 and 1990 establish FQHC and FQHC Services and payment in Medicare/Medicaid – Reasonable cost payments intended to protect grant dollars from low Medicare/Medicaid reimbursements – Medicare FQHC regulations: 42 CFR et seq. – Medicare reasonable cost regulations ( 42 CFR 413) – Medicare RHC/FQHC Manual (Pub. 27) 7 National Association of Community Health Centers

Cost-Based Reimbursement (“Reasonable Cost”) No Medicaid FQHC regulations and minimal CMS guidance. Allowable costs for Medicaid-covered services divided by Billable visits (face to face encounters)= All inclusive per visit rate Example: $1,000,000 allowable costs 10,000 visits All inclusive per visit rate = $100 8 National Association of Community Health Centers

FQHC Services in the Medicaid Program FQHC Services, as defined in Medicaid Statute: 42 USC 1396a(a)(10)(A), 1396d(a)(2)(C) and 1396d(l)(2) – FQHC services in Medicaid are Medicare rural health clinic services and any other ambulatory service in the State Medicaid plan provided by the FQHC 9 National Association of Community Health Centers

The Medicare, Medicaid, and SCHIP Benefits Improvement and Protection Act (BIPA) [P.L ]: Replaces reasonable cost payment to FQHCs with Prospective Payment System (PPS) Found at Section 1902(bb) of the Social Security Act [42 USC 1396a(bb)] 10 National Association of Community Health Centers

The PPS Baseline For services provided between January 1 – September 30, 2001 Payment calculated on a per visit basis States required to pay current FQHCs 100 percent of the average of their reasonable costs of providing Medicaid-covered services during FY1999 and FY2000 Adjusted to take into account any increase (or decrease) in the scope of services furnished during FY2001 by the FQHC Issues: Caps, Screens, Services covered, etc. 11 National Association of Community Health Centers

Calculating Future Rates: Federal Requirements For FY2002 and each fiscal year thereafter, each FQHC per visit payment should be the same as the previous year payment amount, adjusted by: – The change in the Medicare Economic Index (MEI) for primary care services, and – Increase (or decrease) in the scope of services furnished by the FQHC during that year. 12 National Association of Community Health Centers

Change in Scope of Services: What may be considered a change? Adding or subtracting a billable service? A non-billable service – Yes, if it’s a new service? New sites? New capital costs? Intensity of Medicaid services? Volume of Medicaid cost or visits - No 13 National Association of Community Health Centers

PPS for New FQHCs: For entities that qualify as FQHCs after fiscal year 2000, the State plan shall provide for payment in an amount (calculated on a per visit basis) that is equal to 100 percent of the costs of furnishing such services during such fiscal year based on The rates established for the fiscal year for other centers or clinics located in the same or adjacent area with a similar case load or In the absence of such a center, in accordance with Medicare FQHC regulations and methodology, or Based on other tests of reasonableness as the Secretary may specify 14 National Association of Community Health Centers

PPS for New FQHCs: For each fiscal year following the first year in which the entity qualifies as a FQHC, the State plan shall provide for the payment amount to be calculated in accordance with the PPS. 42 USC 1396a(bb)(4) 15 National Association of Community Health Centers

Wrap-Around Payments Federal Requirements 42 USC 1396a(bb)(5) States required to make supplemental payments to FQHCs that subcontract (directly or indirectly) with Managed Care Entities (MCE). Supplemental payment is the difference between the payment received by the FQHC for treating the MCE enrollee and the payment to which the FQHC is entitled under the PPS MCE still must pay FQHC an amount comparable to what it pays similar providers for similar services. 42 USC 1396b(m)(2)(A)(ix) 16 National Association of Community Health Centers

Wrap-Around Payments Federal Requirements Under PPS, State must make supplemental payments at least every 4 months Issues: How will State determine amount of MCE payments to FQHC? What about MCE payment denials (for non-enrollees, ineligible, services not part of MCE contract, etc)? Recent trend toward MCEs making full payment to FQHCs in place of wrap-around. 17 National Association of Community Health Centers

Alternative Payment Methodology: 42 USC 1396a(bb)(6) State and health center option Each individual FQHC must agree to any alternative payment methodology (APM) APM must reimburse a FQHC in an amount that is not less than the amount the FQHC is entitled to under the PPS 18 National Association of Community Health Centers

APM: Implications PPS rate is the “measuring stick” to determine whether rate under alternative methodologies are lawful in subsequent years – As PPS rate increases annually with inflation, so should the rate offered under the alternative methodology APM can be basis for FQHCs participation in payment reform with PPS as the payment floor 19 National Association of Community Health Centers

FQHC Contracting for Dental Services BPHC/HRSA Requirements Section 330 requires FQHCs to provide “primary health services” which are defined to include “preventive dental services” 42 USC 254b(a)(1) and 254b(b)(1)(A) (i)(lll)(hh). “Preventive dental services” are defined by regulation (42│ CFR51c.102(h)(6) to include “services provided by a licensed dentist or other qualified personnel including: – (i) oral hygienic instruction; – (ii) oral prophylaxis as necessary; – (iii)total application of fluorides, and the prescription of fluorides for systemic use when not available in the community water supply.” 20 National Association of Community Health Centers

FQHC Contracting for Dental Services FQHCs can also obtain federal approval to provide “supplemental health services” which can include “dental services other than those provided as primary health services” 42 CFR 51c.102(j)(6) These services can be provided “through staff and supporting resources of the center or through contracts or cooperative arrangements.” 42 USC 254b(a)(1) 21 National Association of Community Health Centers

FQHC Contracting for Dental Services Services have to be included in the health center’s approved scope of grant project and would have to be available to all patients of the health center, i.e. uninsured, Medicaid, insured, etc; and relevant 330 grant rules would apply, such as sliding fee scale for those below 200% of Federal Poverty Line (FPL), no charge or “nominal charge” for those below 100% FPL, and full charge for patients at or above 200% FPL. Fee schedule must be consistent with locally prevailing rates and reflect the health center’s reasonable costs of providing services. 22 National Association of Community Health Centers

FQHC Contracting for Dental Services FTCA coverage would also be available to the contractor if the contract is with the individual contractor. Also, with regard to dental services, the contract would have to be for an annual average of 32.5 hours per week. 42 USC 233 (g) (5) (A) 23 National Association of Community Health Centers

CMS/Medicaid Requirements – Dental services are an optional service in Medicaid; however EPSDT services are a required service for children and they include dental screening and dental services as determined medically necessary per the EPSDT screen 42 USC 1396d(r). Thus dental services are an optional service for adults but a required service for children. FQHC Contracting for Dental Services 24 National Association of Community Health Centers

FQHC Contracting for Dental Services – FQHC services are a required Medicaid service that includes RHC “core services” and any ambulatory service included in the state Medicaid plan. 42 USC 1396d(a)(2)(C) – this requirement should include dental services and result in PPS reimbursement to FQHCs for dental services, but some states still pay FQHCs a FFS payment for dental services. 25 National Association of Community Health Centers

FQHC Contracting for Dental Services – States vary a great deal on what (if any) services they allow an FQHC to provide off-site for which it will be paid on the basis of PPS. However, the Medicaid and CHIP statute 42 USC 1396a(a)(72) and 1397gg(e)(1)(B) provide that a state may not prevent an FQHC from contracting with private practice dental providers in the provision of FQHC services and CMS has recognized this policy in a CMCS informational bulletin dated March 25, National Association of Community Health Centers

FQHC Contracting for Dental Services – In this Bulletin, CMS notes that some state Medicaid agencies “have required dental providers who contracted with FQHCs to individually enroll in the Medicaid program”, however this “is no longer permissible under the statute.” The Bulletin also states that the dental services “furnished off-site by private dental providers who contract with FQHCs will be covered by Medicaid and CHIP as FQHC services when those dental services are of the type that would be covered if provided on-site at the FQHC” and “[p]ayment for such services should be made to the FQHC in accordance with the State plan.” 27 National Association of Community Health Centers

FQHC Contracting for Dental Services – Payment to dentist by FQHC – FQHCs can contract with dentist for payment on the basis of specific services to be provided to the FQHC patient using a negotiated fee- schedule; number of patients to be seen; number of visits available to FQHC patients; number of sessions (hours or days) to be committed to FQHC patients; or other mutually-agreeable basis. – PAYMENT TO THE DENTIST IS NOT TO BE BASED ON PPS, i.e. the FQHC’s PPS rate cannot directly determine the payment rate to be made to the contracting dentist i.e. cannot be a “pass-through” of Medicaid PPS payment to another provider 28 National Association of Community Health Centers

FQHC Contracting for Dental Services States are concerned about paying an increased amount of money to the same provider for the same services as a result of FQHC affiliation and/or contracting arrangements. Be sure that the state Medicaid agency is agreeable to the arrangement and the payment structure. Resource: “Increasing Access to Dental Care Through Public Private Partnerships: Contracting Between Private Dentists and Federally Qualified Health Centers. An FQHC Handbook” (March 2011) Children’s Dental Health Project, Washington, DC 29 National Association of Community Health Centers