1. THIE HOT TOPICS October 2, Changes in State and Federal Reimbursement and How it Affects your Facility By: Brent Fuller and Mark Havins

2. Agenda 1115 Waiver Update UHRIP Update Key State Legislative Changes
Managed Care Contract Issues
Trends in Rural Healthcare
RHC Update
Key Federal Legislative Act

3. 1115 Waiver Uncompensated Care
DY9 State UC cap was increased up to $3.87 billion
Move from UC tool calculation to S10
UC Tool request was due Sept. 20th
Reversal of CHAT lawsuit
US Court of Appeals in DC reverses lower court’s opinion
$200m hit for Ryder 38 Hospitals
How will HHSC recoup?
UC Withhold/UPL Obligation
Withheld UC Payments for DY 3-6
HHSC to direct $400 million through the UHRIP Program
Small Public Rider 38 - $9 million
Small Private Rider 38 - $3 million

4. DSH Payments Changes in Hospital Specific Limit (HSL) Proposal
HSL is to be renamed as “State Payment Cap (SPC)”
HHSC has decided not to change the current calculation method.
Current CMS Method vs MACPAC Method
CMS Method includes dual eligible payments and costs
MACPAC Method excludes cost and payments for all Medicaid eligible patients for whom Medicaid is not the primary payor.
Results increase DSH payments that serve a high share of Medicaid-only patients.
Run models to determine effect on Rural Hospitals
MACPAC Method is better for Hospitals with a high volume of dual eligible patients
sent on Sep 17th

5. 1115 Waiver DSRIP DY9 begins reduction of available amounts
Achieving metrics and measures more difficult than previous waiver
Many participants dropping out

6. Uniform Hospital Rate Increase Program (UHRIP)
Was created in a cooperative manner by hospitals, public & private, in each service delivery area (SDA)
Only pertains to Medicaid MCO payments.
All Hospitals are covered through pooled IGT.
Hospitals have agreements (LOAs) with the MCO for certain reconciliations that are undertaken without HHSC.
UHRIP mandates cooperation
If no cooperation, program fails.

8. UHRIP 1.0 Went from $600 million in Year 1 to $1.6 billion in Year 2
Only affects MCO payments
Receive benefit on paid claims
Benefit is held by MCO until claims are paid
IGT in May for claims paid from September – March
Rural Hospital benefit is less due to DSH issues.
DSH IGT is better return than UHRIP IGT

9. UHRIP 2.0 Proposal Starts September 2020
Change from increased paid claims to lump sum payment
HHSC determines the rate increase vs current application
Limits ability to tailor increases based on IGT availability and impact on DHS
IGT is not tied up as long
A uniform dollar increase per encounter as opposed to a rate increase per claim
Possibly weighted based on acuity
Rider 38 Hospital – 153 DSH – 78 Non DSH - 75
Private – 64 DSH – 30 Non DSH – 34
Public – 89 DSH – 48 Non DSH - 41

10. UHRIP 2.0 (Continued)
Benefit is calculated on previous quarter encounters
Paid claims for the previous quarter are tabulated
IGT and Payments made 6 months after quarter ends
IGT is submitted and receive a lump sum
Similar to UC and DSRIP
Will require a quality component ??
Rural Hospitals are currently exempt from quality measures
Paid quarterly like UPL was done.
Will have to wait 9 months after the new program starts.

11. Key Legislative Bills
Senate Bill 170 – Add on for Rural Medicaid Payments
House Bill 3934 – Collaboration in Insurance Contract Negotiations
House Bill 1 – Budget Appropriations for SB170
Key Players
Senator Perry – District 28
Senator Kolkhoust – District 18
Representative Burrows – District 83
Representative Price – District 87

12. Senate Bill 170 Took effect September 1, 2019
Increases Medicaid payments for Rural Hospitals
Rural Hospital is a CAH, Sole Community Hospital, Rural Referral Center (RRC) – in an rural MSA.
Payments will take two forms:
24% increase in inpatient claims payments (24% increase in your Standard Dollar Amount)
$ 500 add-on payment for each baby delivered
This legislation is designed to cover services through traditional and MCO payment plans
However, many MCO plan contracts include language that may exclude this increase from applying.
Contracts may include a ”lesser of billed charges or Standard Dollar Amount” clause
May need a review of contract stipulations and / or charge structure to see this increase in payment through the MCO’s.
Bill is actually law now. Bill passed, but came out of S 170. . 12

13. How to get Insurance Companies to Re-Negotiate
Pressure from HHSC and Legislatures.
Letter to HHSC from TORCH
Senator Perry addressing Insurance Commission
Collaborative Negotiating
Problems
Insurance Negotiation practices
Delayed payment and Denial practices
Cancel Contracts
Ins co we are referring to are BC, United, Humana, Advantage plans, commercial patient coverage and Medicaid mco.
Ins negotiations delay so as to reduce the time in review as much as possible.
Delay tactics due to Med review and necessity or outright denials.
Medical staff time with peer review 5 times and all were denied.
Who has had these issues?

14. House Bill 3934 Changes the Insurance Code
Gives Authority to Rural Hospitals to establish a Health Care Collaborative
An entity that undertakes to arrange for medical and health care services for insurers, HMOs and other payors
Consists of Physicians and/or Rural Hospitals
Rural Hospital
Licensed Hospital with 75 or fewer beds
In a county with a population of 50,000 or less
Is a CAH, Rural Referral Center or a Sole Community Hospital

15. Trends in Rural Healthcare Transition to Managed Care
Growing transition in payments to managed care
Medicaid made this transition several years ago
Growing trend of Medicare patients are transitioning to Advantage Plans (MA)
Consideration in consistency in payment / aggregate reimbursement between traditional Medicare and Medicaid reimbursement models and managed care plans
Current Transitional trends – Texas
Medicaid MCO accounts for 94% of the aggregate claims volume
Medicare enrollment in Texas is approximately 36% of the Medicare population
Medicare Advantage enrollment has doubled in the past decade and increased, on average, 8-10% per year
CBO projects Medicare Advantage to at 50% or greater of the aggregate Medicare population by 2029.
Growing number of Medicare beneficiaries as baby boomers age into Medicare
Cbo notes
50% Medicare & higher numbers of mcare because of baby boomers. Lot high count in future.
Talk about stats. Stats say higher % of volume will be Mcare and higher percent of overall patient count. 15

16. Trends in Rural Healthcare Transition to Managed Care
Medicare
Medicare Advantage continues to grow – (36% of Medicare population in Tx)
Topics of Consideration with Medicare Advantage Plans
Contract language – ensuring consistency in payment between Traditional and Advantage Payment Plans
Periodic Internal Claims Review to ensure that Advantage Plans are paying claims in same manner as traditional – there is a growing amount of A/R among the Advantage plans.
Take Away -
Systematic determination if there is a short-fall in payment amounts between Traditional and Advantage plans for similar services.
Consider Identification of Charges by Payer
Comparative Analysis of Reimbursement between Traditional and Advantage Plans
Contract language & claims payments.
Torch initiative on finding shortfall.
Separation of charge structure and reporting by individual payer
Reason for separation of charges. If we have charges, we can readily determine what cost is by payer 16

17. Definition of an RHC visit per Section 40 of Chapter 13 of the Medicare Benefits Policy Manual
An RHC visit is a medically-necessary medical or mental health visit, or a qualified preventive health visit. The visit mist be a face-to-face (one-on-one) encounter between the patient and a physician, NP, PA, CNM, CP, or a CSW during which time one of more RHC services are rendered. A Transitional Care Management (TCM) service can also be an RHC visit. Services furnished must be within the practitioner’s state scope of practice, and only services that require the skill level of the RHC or practitioner are considered RHC visits.
Exception
chronic care mgt visits
Vaccines
Blood pressure
Lab draw in an RHC?
Telemed visit

18. Practitioner defined Physician Assistant (PA) Nurse Practitioner (NP)
Certified Nurse Mid-wife (CNM)
Clinical Psychologist (CP)
Physician
Clinical Social Worker (CSW)
Visiting Nurse - homebound patients (RN, LVN, or LPN)
Not Practitioner in RHC
Lab Technician
Other health care staff- example of radiology tech, EKG tech, or Ultrasound technician, Dietician
CRNA
Sonographer
Licensed Professional Counselor (LPC)
Highlight LPC and clinical psych.

19. RHC Patient defined Individuals who receive services at the RHC
Individuals who receive services at a location other than the RHC for which the RHC bills the service or is financially responsible for the provision of service.
Individuals whose cost of care is included in the cost report of the RHC
Nursing home or a patient home

20. Covered Services – RHC visit
An RHC service:
Primary Care Diagnosis
992xx CPT codes
Office or other outpatient visit for the E & M….
993xx CPT codes
Nursing facility care services
Services and supplies incident to the practitioner services
Nursing Home Visit for primary care diagnosis
Transitional Care Management Service (30 day TCM period)
Qualified Preventable Health Services
Initial Preventable Physical Exam (IPPE)
Annual Wellness Visit (AWV)
Expanded Services for RHC after Oct 2016 – covers many urgent care type visits
Billing Injection w an RHC visit
Last bullet highlight. New services in Oct 2016, pub released August 2016.

21. New Legislation Enacted Future of Charity Reporting for UC
Charity vs Bad Debt
Charity Policy – defines attributes of Charity qualifications And Bad Debt qualifications.
Documentation for Bad Debt and Charity
Federal Register Mandate
Patient Accounting System Records
Patient records required for Submission with reporting in Cost Report
We get questions on whether to claim as a bad debt or charity. Ability to pay.
Charity vs bad debt reporting
What defines ability to pay 21

22. New Legislation Rural Ambulance Provisions
New interpretative Guidelines for rural based Ambulances Services to Cost-Based CAH providers.
Traditional interpretation of 35 mile rule
New interpretive guidelines to the 35 mile rule
Exception – if another EMS provider within 35 miles is “not legally authorized” to provides patient transfer services to the Critical Access Hospital (CAH)
CAH Based Ambulance services may be eligible to receive cost-based reimbursement. 22

23. New Legislation Rural Health Clinic Modernization Act of 2019
S –J. Barrasso (R- WY) – April 2019
H.R 2788 – A. Smith (R – NE) – May 2019
Updates provision for lab services and diagnostic services performed through the RHC.
Allows RHCs to contract with Physician Asst and Nurse Practitioners. This eliminates the need to employ a mid-level in the RHC.
Allows RHCs to be the distant site for telehealth visit. This allows for RHC rates for a telehealth visit, as opposed to a site facility fee only for telehealth.
Sets new Medicare Cap rates beginning in FFY 2020 – $105 / visit,
FFY $110 / visit, and FFY $115 / visit.
Several parts to bill
Has not passed 23

24. THIE HOT TOPICS October 2, 2019 Thank You
THIE HOT TOPICS October 2, Thank You! By: Brent Fuller and Mark Havins Ph (806) DHCG.com