DOH Proposes A/R Recovery Program
DOH is proposing to waive some or all interest on outstanding balances Medicaid providers owe to the state as an incentive to reduce the Medicaid rate-related accounts receivable (A/R) balance that stood at $350 million in January. Along with concerns about staying below the 2013-14 state fiscal year (SFY) Medicaid global cap, the state foresees that migration to Medicaid managed care will make recovery of outstanding balances more complicated.
The goal of the program would be to recoup all outstanding A/R balances within two years with the following options available to providers:
Option 1: Immediate Repayment. Providers who pay their balance immediately or by Aug. 1, 2013, would have accumulated interest charges waived.
Option 2: Repayment by March 1, 2014. Providers who pay balance by March 1, 2014, would have half of accumulated interest charges waived.
Option 3: Repayment within Two Years. Providers with outstanding liabilities that do not select one of the options above would have their Medicaid payments reduced by a calculated percentage to ensure that outstanding principal and interest would be recouped by March 31, 2015.
Providers would need to advise DOH by May 15, 2013, if they are opting for one of the interest abatement options.
The interest rate currently used is 5.25 percent (prime plus two percent) and begins accumulating when a liability is not repaid before ten weekly Medicaid payment cycles. Please note that this proposal is for Medicaid-rate related liabilities only -- outstanding OMIG audit recoveries and cash receipts assessment amounts are not part of this proposal.
We have expressed conceptual support for the waiving of interest but have stressed to DOH that it is critical for providers to know the timing of outstanding rate adjustments, including the nursing home universal settlement, to be able to commit to making repayments. If you have comments or suggestions regarding this proposal please let us know this week so that we can include them in our comments to DOH.
Contact: Darius Kirstein, dkirstein@leadingageny.org, 518-867-8841