State Adopts Case Mix Regulations
In the June 2nd issue of the State Register, the Department of Health (DOH) republished and adopted regulations changing the methodology used to adjust nursing home Medicaid rates for acuity. The change, effective June 2nd, does away with the “picture date” methodology in favor of using all assessments filed during a six-month period to calculate case mix index (CMI) adjustments to the rates. DOH intends to use the new approach starting with July 2021 rates. The CMI calculations in the July 2021 rates will be based on all Minimum Data Set (MDS) assessments filed for Medicaid residents from October 2020 through March 2021.
DOH first published the proposed regulations in January 2020. The adopted regulations differ from the previous version only in that the rate period first impacted by the new methodology is changed from July 2019 to July 2021. The regulations specify that:
“for the case mix periods beginning on and after July 1, 2021, the case mix adjustment to the direct component of the price shall be made in January and July of each calendar year and shall use all Medicaid-only case mix data submitted to CMS applicable to the previous six-month period (e.g., April – September for the January case mix adjustment; October – March for the July case mix adjustment).”
In addition, the adopted regulations repeal the language authorizing DOH to constrain rates if a provider’s case mix changes by more than 5 percent relative to the prior rate period. In their comments, DOH indicates that it no longer intends to exercise that authority so is eliminating the provision.
The State Register adoption notice includes the State’s response to the comments it received regarding the original January 2020 publication. The comments we submitted at the time are available here, and the link to the State Register is here (see pp. 10-11). The original publication from January 2020 is here. While the State had originally submitted a Medicaid State Plan Amendment for federal government approval associated with the CMI change, it rescinded the submission in May of this year and has not filed anything further.
Members will recall that a previous attempt on the part of the State to make this change outside of the regulatory process was blocked by Acting State Supreme Court Justice Kimberly O’Connor, who issued an order preventing DOH from implementing the CMI change on Nov. 7, 2019. In January 2021, the Court issued a decision that granted our petition (and two other similar suits) “…only to the extent of annulling the Department’s case mix adjustments effective July 1, 2019, and enjoining the respondents-defendants from using the ‘average calculation’ method they adopted effective July 1, 2019 for the case mix adjustment and directing respondents-defendants to continue using the method for calculating the case mix adjustment in effect as of June 30, 2019, until the ‘average calculation’ method is adopted as a rule in accordance with the State Administrative Procedure Act” (pp. 54 of the decision).
We are gathering impact information from members and thank you for your input in advance. We continue to make the case to DOH that the State should be working toward developing and phasing in a more appropriate case mix adjustment methodology in line with the Acuity Workgroup recommendations and stress the disruption this will have on many members at a time when providers are facing financial challenges exacerbated by the pandemic.
Contact: Darius Kirstein, firstname.lastname@example.org, 518-867-8841