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Nursing Home Funding Issues Update

Along with being on target to publish January 2018 Medicaid rates very close to Jan. 1st, Department of Health (DOH) staff have completed work on the 2016 assessment reimbursement reconciliation and are in the process of calculating the Nursing Home Quality Initiative (NHQI) adjustment amounts for 2015 and 2016. These were among the updates that DOH provided to LeadingAge NY and other associations during last week’s discussion of Medicaid funding issues. Highlights from the meeting are outlined below.

2018 Medicaid Rates

DOH is on schedule to publish January 2018 rates by Jan. 1st. The rates will reflect a case mix adjustment based on July 2017 MDS assessments as well as all accepted correction requests submitted through the attestation process. DOH reports that all but a handful of homes submitted the attestation, which was required of all homes this year, and only 10 correction requests were rejected. The rates will also include an adjustment based on information provided to DOH on the nursing home minimum wage survey as well as the supplemental contracted staff minimum wage survey. The benchmark rate list will be updated with 2018 rates soon after they are published.

Because the five-year phase-in of the statewide pricing reimbursement methodology has ended, the statewide beginning direct and indirect prices no longer change year to year. Changes to Medicaid rates are driven by case mix, prevalence of residents qualifying for special population add-ons (dementia, bariatric, and TBI residents), and the capital component. Inflation adjustments have not been applied since 2007. DOH continues discussions with the Centers for Medicare and Medicaid Services (CMS) on the possibility of a separate Managed Long Term Care (MLTC) nursing home rate cell. They have put together fact sheets, are addressing CMS concerns regarding requirements to provide care in the most integrated setting possible, and are working with the state’s actuary on ideas to best incentivize return to the community when possible.

Assessment Reconciliation

The 2016 assessment reconciliation calculation is complete, and rate adjustment amounts have been sent to eMedNY. Homes should see the adjustment in Medicaid checks released in January. Because two Universal Settlement payments were made in 2016, the reconciliation is likely to be positive for many homes. DOH is working on the most effective way to provide homes with their individual calculations, which may be communicated differently than through the posting of calculation sheets on the Health Commerce System (HCS). The 2016 reconciled assessment reimbursement per-day amounts will be used in the 2018 benchmark rates. At this time, DOH has not determined whether the assessment reimbursement amount used in 2018 fee-for-service billing will be updated from its current 2014 basis.


DOH staff reminded that contracts between MLTC plans and nursing homes (as well as home care providers) are required to be amended or written to contain a Value Based Payment (VBP) component by the end of the year. Providers should note that while plans may offer contract amendments that include more complex VBP provisions, given the short timelines, most are likely to focus on Level 1 arrangements using the avoidable hospitalization measure. While MLTC Level 1 contracts are pay-for-performance arrangements with no downside risk, there is also very limited funding associated with the program, so it may be unlikely that these amendments will result in significant or any additional payments at the outset.

For contracts with nursing homes, the required hospitalization measure is the same as the one included in the NHQI (i.e., number of potentially avoidable hospitalizations per 10,000 long stay days). DOH has calculated and posted facility-specific rates for the 2016 measurement year, which are available here and can be accessed on the HealthData NY website. Additional measures that have been approved for optional inclusion in VBP arrangements with nursing homes are listed in the MLTC Clinical Advisory Group Value Based Payment Recommendations report. The Skilled Nursing Facility (SNF) contract amendment template is posted on the DOH VBP Resource Library page in the VBP MLTC section.

Please note that DOH stresses that the contract amendment templates are to be used solely as an optional tool to assist plans and providers who are getting started with VBP contracting. Use of the templates in any form is not mandatory, and if the templates are used, they may be modified.

Because the VBP requirement is an important step in the state’s ability to meet its alternative payment arrangement goals and ensure related federal funding, we urge members to be responsive when contacted by MLTC plans with which they contract. However, providers should be aware of the terms of the VBP amendment being offered and avoid being locked into a long-term agreement given that VBP for long term care is still in its developmental stages.

OMIG Audits

The Office of the Medicaid Inspector General (OMIG) will continue to audit MDS assessments at this point and has begun 2015 audits in the western part of the state. Homes selected for audit will have MDS assessments from both the January and July 2015 “picture dates” audited. To help expedite the MDS audit process, OMIG will be issuing initial audit reports as they conduct audits rather than wait until all audits are complete. DOH is also considering the possibility of auditing 2016 and 2017 assessments together.

Bed Hold, Quality Pool, and 1 Percent Supplement

A resolution on the hospitalization bed reservation issue that may restore a portion of bed hold funding that was eliminated effective April 1, 2017 in the 2017-18 State Budget is expected shortly from the Governor’s office. (Note that the elimination has been on hold since May, and providers were instructed by DOH to continue calculating and billing hospitalization bed hold as they had prior to April 1st.)

DOH is set to publish final NHQI regulations in December and is in the process of calculating NHQI rate adjustments for 2015 and 2016. DOH recently distributed the 2018 NHQI methodology (information here) and is expected to circulate the 2017 results (i.e., 2017 payment year/2016 measurement year) for facility review soon. As noted above, the potentially avoidable hospitalization measure for measurement year 2016 has been calculated and posted. The State Plan Amendment (SPA) to reinvest the 0.8 percent assessment into nursing home rates is still on hold with CMS, and DOH is working through it.

Advanced Training Initiative

Homes that qualify for Advanced Training Initiative (ATI) Year 3 funding have been notified. To claim the allocated funding, each eligible home is required to submit the online application indicating their training partner and the program or programs that they intend to implement. The application must be completed by Wed., Dec. 20th.

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