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DOH Describes Implementation Plans for FY 2020-21 Managed Care Budget Actions

In a series of webinars last week, the Department of Health (DOH) described its plans for implementing various managed care budget actions, including the independent assessor and physician panel initiatives for personal care and consumer directed personal assistance, Managed Long Term Care (MLTC) enrollment caps and withholds, encounter data withholds, and new electronic notice and prior authorization standardization policies.

Independent Assessor and Physician Panel

Under the State Fiscal Year (SFY) 2020-21 budget, DOH is required to contract with an independent entity to conduct assessments and reassessments to determine beneficiary need for personal care and Consumer Directed Personal Assistance Program (CDPAP) services. In order to qualify, under the budget legislation, a beneficiary must require at least limited assistance with physical maneuvering with more than two activities of daily living (ADLs), or for individuals with a dementia or Alzheimer's diagnosis, at least supervision with more than one ADL. In addition, the budget provides for a review by a physician panel of individuals who are authorized to receive 12 or more hours of personal care or CDPAP services daily. The physician panel review of 12+ hour cases entails a clinical rationale and recommendation concerning whether the plan of care is appropriate to maintain the member safely in the home.

These provisions apply to personal care and CDPAP services under MLTC, mainstream managed care, and fee-for-service (FFS) Medicaid. The new standards will apply to individuals receiving an initial authorization for personal care or CDPAP services on or after Oct. 1, 2020. 

For the first two years, Maximus (the entity currently engaged to administer the Conflict Free Evaluation and Enrollment Center (CFEEC)) will serve as the independent assessor and provide physician reviews. Maximus will also be responsible for obtaining physician orders for services. In October 2022, the Department will transition the activities to a separately procured vendor. Community health assessments will be conducted annually, beginning on Oct. 1, 2020, rather than semiannually.

Managed care plans will retain the responsibility to develop the plan of care and conduct care management and utilization review. Plans may also opt to conduct other assessments (e.g., falls risk assessments) as part of their care management function. In addition, plans may seek DOH approval of alternative, risk-stratified care management models. Slides from this webinar are available here.

Partial Capitation Enrollment Cap

In an effort to curb enrollment growth in MLTC, the SFY 2020-21 budget includes a provision to cap enrollment growth in partially capitated MLTC plans and to enforce that cap through a withhold from MLTC premiums. DOH has announced that, in the first year of this initiative, withholds will be repaid based on timeliness and completeness of data submission regarding new enrollment. In the second year, withholds will be based on comparison to an enrollment cap. A percentage of premium withhold from the base rate will be implemented with the July rate update, retroactive to April 1st. It is anticipated that the withhold will be repaid to plans that properly submit enrollment data in the first quarter of SFY 2021-22. Data will be submitted quarterly, with the first submission reflecting two quarters due on Oct. 31, 2020. The reporting template will be provided on July 1st. The slides from the webinar are available here.

Although this initiative is intended to curb new enrollment in the MLTC program, DOH's presentation suggested that members transferred to a plan as a result of another plan's closure or merger would be counted as new enrollment. Plans questioned the rationale for this approach. Plans also raised the concern that the caps might constrain or eliminate consumer choice, especially in regions that have only one or two plans. In addition, plans noted the implications of the long-term nursing home benefit limit scheduled to take effect over the next few months and the possibility that amounts withheld would be excessive based on enrollment figures after the carve-out. Plans also pointed out the potential impact of this withhold, combined with the encounter data withhold, on their ability to meet capital and escrow requirements and the regulatory consequences of falling short of those requirements. DOH agreed to consider plan feedback as it finalizes its policies.

Encounter Data Withhold and Penalties

The SFY 2020-21 budget includes a 1.5 percent withhold from MLTC plan premiums, and a separately calculated 1.5 percent penalty, for failure to properly submit encounter data. The 1.5 percent withhold applies to all MLTC products except Programs of All-Inclusive Care for the Elderly (PACE). Based on the DOH webinar, the penalty appears to apply to all MLTC products, including PACE. LeadingAge NY is confirming its applicability to PACE. 

The withhold is calculated from total premium and is retroactive to April 1, 2020. Plans can earn back the withhold by proper submission of an Encounter Data Reconciliation Worksheet that reconciles variations between encounter data and cost reports. The amount earned back will be determined based on the quality and timeliness of the Reconciliation Worksheet submission. Plans will receive encounter data to cost report comparison reports from DOH and will be asked to submit the Reconciliation Worksheet within 30 days of receipt (estimated Dec. 31, 2020). Withheld amounts earned back will be returned in April 2021.

The encounter data penalty for MLTC is likewise applied to total premium (not merely the administrative component of the premium). Penalty metrics are timeliness, accuracy, completeness. Accuracy is calculated based on the encounter data to cost report comparison report at the category of service level. Penalties will be assessed in March 2022 based on 2020 data. DOH intends to implement both the penalty and the withhold on a lump sum basis.

Plans raised a number of concerns related to the withhold and penalty. For example, DOH is proposing to cut off encounter data used for the comparison report on July 31st. Plans noted that long-term care providers often need additional time to submit claims, especially in the context of COVID-19. In addition, there have been ongoing technical problems with encounter data submission, including inappropriate rejection of encounter data by DOH. DOH agreed to consider these concerns. The slides from the webinar are available here.

Electronic Notice Requirement and Prior Authorization Standardization

The SFY 2020-21 budget also authorizes the delivery of grievance, appeal, and authorization notices via electronic means, consistent with member preferences. Plans may also notify members of benefit package changes electronically. Member notification preferences must be documented by the plan. Notices to providers must be transmitted electronically, to the extent practicable, in a manner agreed to by the plan and provider. Draft guidance for plans is to be circulated in June and finalized in August.

The Department is also undertaking an initiative to develop a standard data set for submission of prior authorization requests in an effort to reduce denials of services stemming from incomplete or inadequate data received in providers' requests. It will establish a work group to consider the elements of a complete request. The work group will kick off in June and meet from July through October with the goal of finalizing the data set in November and implementing it in January 2021. The slides from the presentation are here, and the relevant section begins on slide 12.

Contact: Karen Lipson, klipson@leadingageny.org, 518-867-8838