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Key Nursing Home Funding Questions Await Answers

The Department of Health (DOH) is working on several key nursing home Medicaid funding issues that we are monitoring but on which there is no additional information at this time. We are awaiting updates on how DOH will calculate the case mix that will be reflected in January 2019 Medicaid rates and will circulate information as soon as it is available. DOH will make final decisions based on the outcome of their data analysis, but it is likely that the two case mix indices (CMIs) (based on April and July picture dates) will be blended to reduce rates by the annual $15 million savings required by the 2018-19 State Budget. In the absence of a better methodology to budget for the change, members may want to use a proportional amount as a placeholder (i.e., an approximate decrease of $2.20-$2.40 for the first three months of 2019 and a $0.55-$0.60 decrease for the remaining nine months, multiplied by the direct component wage equalization factor shown on line 3 of the home’s Medicaid rate sheet).

Other than case mix, the final January rates should match the figures providers saw in the draft preliminary rates, including provider-specific minimum wage funding and a 1.5 percent increase to the operating component due to the Health Care Transformation Fund enacted in the 2018-19 State Budget. The 1.5 percent increase is calculated based on the July 2018 operating component and applies to both geriatric and specialty rates as well as Adult Day Health Care rates. An updated Medicaid Rate Sheet template that can assist in verifying and projecting the Medicaid rate can be downloaded here.

We are also awaiting further information on when the transition from managed care to fee-for-service for permanent nursing home residents might begin as the State continues its discussions with the Centers for Medicare and Medicaid Services (CMS). As of this writing, DOH has not determined whether the recently distributed quality initiative and supplemental payments are subject to the cash receipts assessment. We will share the information as soon as DOH clarifies.

Contact: Darius Kirstein, dkirstein@leadingageny.org, 518-867-8841