Nursing Home Reimbursement Update
(Sept. 17, 2024) The Department of Health (DOH) is completing work on the first round of older Medicaid rate appeals with the hope of making related payment adjustments within several months. That was a piece of encouraging news that the Department unveiled during a meeting on financial issues with LeadingAge NY and other associations representing nursing homes. The meeting, led by the Bureau of Nursing Home and Long-Term Care Rate Setting, which is within the Office of Health Insurance Programs, provided updates on a number of fee-for-service Medicaid rate issues. Minimum staffing and minimum spending requirements were not covered, as these are handled within the separate and distinct Office of Aging and Long-Term Care. Highlights of the discussion are provided below.
Medicaid Case Mix. DOH is working with national accounting and consulting firm Myers and Stauffer on developing a replacement Medicaid case mix methodology based on the Patient-Driven Payment Model (PDPM) approach used in Medicare Part A reimbursement. The Department reports that the firm is currently focused on data collection and early-stage data analysis. DOH continues to pledge that it will involve stakeholders when the process reaches appropriate “touch points,” including information sharing and training. While unwilling to predict an implementation timeline, DOH indicated that the timeline would depend on many factors, including the Bureau’s staff availability to work on the project.
The Centers for Medicare and Medicaid Services (CMS) has approved the Medicaid State Plan Amendment (SPA) freezing the Medicaid case mix pending the adoption of a replacement case mix methodology. The timing of the freeze is the subject of litigation.
Funding Increase. While the required Medicaid SPA is almost ready to be submitted to CMS, DOH is not yet willing to discuss how the $285 million in new funding will be distributed. Members will recall that the Fiscal Year 2025 (FY25) State Budget included funding to increase nursing home and Adult Day Health Care (ADHC) rates but did not specify whether the funding would be distributed as a uniform per-day add-on or as a percentage increase to the rate. Given that the SPA is yet to be filed, we are focused on getting the State to release at least the State share of the funding as soon as possible.
Capital Cut. CMS has approved the SPA authorizing the 10 percent cut to Medicaid capital reimbursement effective April 1, 2024 (corrected date- original publication of this article erroneously read "2023"). DOH is working on implementing the cut, although no date has been set. We have stressed the damaging nature of this cut to CMS and are urging DOH not to implement the reduction without the release of the additional funding. The cut will be subject to legal challenge.
Other Outstanding SPAs. DOH continues to await federal approval for FY24 and FY25 CINERGY funding, as well as approval for SPAs authorizing the payment of public nursing home Intergovernmental Transfer (IGT) payments. DOH indicated that they were engaged in active conversations with CMS on both issues and expressed cautious optimism for progress. The State has paid the State-share portion of FY24 CINERGY funding.
Historic Rate Appeals. DOH has completed work on the first package of older Medicaid rate appeals. While the payment schedule still needs to make its way through Executive review and receive sign-off from the Division of the Budget (DOB), the hope is that those processes will be complete within several months. Members may recall that in the fall of 2023, DOH had asked providers to review and certify that Medicaid rate appeals for 2009 through 2021 that were on file with the Department were still active and valid (the “appeals exercise”). This will mark the payment of the first batch of appeals that DOH has processed, with additional batches expected in the future. While the list of providers whose appeals are reflected in this first package is not available, the included appeals are those for which there are no litigation implications. Financial distress of the provider was one, but not the sole, factor determining the selection.
Cost Report/Minimum Wage Survey. DOH reminded that 2023 nursing home Medicaid cost reports, certifications, and related party financials are due Sept. 20th. As of Sept. 16th, the Department indicated that reports and/or certifications were still outstanding for approximately 170 homes. The September deadline represents a 30-day extension to the original August due date. The reports and certifications must be submitted electronically; related party audited financials should be sent by email to RHCF-HCS@health.ny.gov. More information on cost report filing is available here.
In addition, the minimum wage survey that collects information that will be used to update 2025 Medicaid rates is due by Sept. 25th. As always, only those costs incurred to bring wages up to the new minimum wage are counted when rate add-ons are calculated. If a facility had no staff whose wages in 2024 were below the upcoming 2025 minimum wage, it may opt out of the survey by completing the first three questions and uploading a signed attestation. The link to the online survey is here; more information is here.
Other. A second correction to the 2022 Cash Receipts Assessment reconciliation is pending. The second correction impacts approximately 40 facilities whose names start with R through W. These facilities are a subset of the 101 homes that were the subject of the first correction. The Office of the Medicaid Inspector General (OMIG) reported that it had completed 2018 Minimum Data Set (MDS) audits of 188 nursing homes and has issued 109 final reports. OMIG is now auditing 2019 MDS assessments and has held 34 entrance conferences in the Capital Region, 25 in the Buffalo region, and is working through 10 in the North Country. OMIG has also commenced audits of the Health Care Worker Bonus Program and is targeting a cross-section of provider types, including nursing homes.
Contact: Darius Kirstein, dkirstein@leadingageny.org, 518-867-8841