BEFORE THE DEPARTMENT OF PUBLIC

HEALTH AND HUMAN SERVICES OF THE

STATE OF MONTANA

 

In the matter of the amendment of ARM 37.85.212, 37.86.101, 37.86.105, 37.86.1201, 37.86.3205, 37.87.901, and 37.88.907 pertaining to revision of by report reimbursement

) ) ) ) )

NOTICE OF PUBLIC HEARING ON PROPOSED AMENDMENT

 

TO: All Concerned Persons

 

            1. On May 15, 2014, at 3:30 p.m., the Department of Public Health and Human Services will hold a public hearing in the auditorium of the Department of Public Health and Human Services Building, 111 North Sanders, Helena, Montana, to consider the proposed amendment of the above-stated rules.

 

2. The Department of Public Health and Human Services will make reasonable accommodations for persons with disabilities who wish to participate in this rulemaking process or need an alternative accessible format of this notice. If you require an accommodation, contact Department of Public Health and Human Services no later than 5:00 p.m. on May 8, 2014, to advise us of the nature of the accommodation that you need. Please contact Kenneth Mordan, Department of Public Health and Human Services, Office of Legal Affairs, P.O. Box 4210, Helena, Montana, 59604-4210; telephone (406) 444-4094; fax (406) 444-9744; or e-mail [email protected].

 

3. The rules as proposed to be amended provide as follows, new matter underlined, deleted matter interlined:

 

            37.85.212 RESOURCE-BASED RELATIVE VALUE SCALE (RBRVS) REIMBURSEMENT FOR SPECIFIED PROVIDER TYPES (1) and (2) remain the same.

            (3) Except as set forth in (8) through (12), tThe RBRVS fee for a covered service is calculated by multiplying the RVUs determined in accordance with (7) by the conversion factor. The RBRVS fee may also be multiplied by a rate variable to calculate the fee paid by Medicaid.

            (4) through (6) remain the same.

            (7) The RVUs for most services are adopted from the Medicare Physician Fee Schedule described in (1). For services for which Medicare does not specify RVUs, the department sets those RVUs as follows:

            (a) convert the existing dollar value of a fee to an RVU value;

            (b) evaluate the RVU of similar services and assign an RVU value; or

            (c) convert the average by report dollar value of a fee to an RVU value.

            (8) Except for physician administered drugs and vaccine administration as provided in ARM 37.86.105(4), clinical, laboratory services, and anesthesia services, if neither Medicare nor Medicaid sets RVUs or anesthesia units, then reimbursement is by-report.

            (a) Through the by-report methodology the department reimburses a percent of the provider's usual and customary charges for a procedure code where no fee has been assigned. The percentage is determined by dividing the previous state fiscal year's total Medicaid reimbursement for RBRVS provider covered services by the previous state fiscal year's total Medicaid billings.

            (b) The effective date and by-report rate are as provided in ARM 37.85.105(2).

            (9) For clinical laboratory services for which there is an established fee:

            (a) the department pays the lower of the following for procedure codes with fees:

            (i) the provider's usual and customary charges for the service; or

            (ii) 60% of the Medicare fee schedule for physician offices and independent labs and hospitals functioning as independent labs; or

            (iii) the established Medicaid fee.

            (b) for clinical laboratory services for which there is no established fee, the department pays the lower of the following for procedure codes without fees:

            (i) the provider's usual and customary charges for the service;

            (ii) the rate established using the by-report methodology; or

            (A) for purposes of (9)(b) through (9)(b)(iii), the by-report methodology means averaging 50 paid claims for the same code that have been submitted within a 12-month span and then multiplying the average by the amount specified in (8)(b).

            (iii) the historical comparative value of the procedure as indicated by the reimbursement amount paid by Medicaid and other third party payors for the same procedure within the last 12 months.

            (10) For anesthesia services the department pays the lower of the following for procedure codes with fees:

            (a) the provider's usual and customary charges for the service;

            (b) a fee determined by multiplying the anesthesia conversion factor by the applicable anesthesia units, and then multiplying the product by the applicable policy adjustor, if any; or

            (c) the department pays the lower of the following for procedure codes without fees:

            (i) the provider's usual and customary charges for the services; or

            (ii) the by-report rate.

            (11) For providers listed at ARM 37.85.212(2) billing for durable medical equipment, prosthetics, orthotics, and medical supplies (DMEPOS), except for the bundled items as provided in (13), the department pays:

(a) the fee listed on the Medicaid fee schedule as provided in ARM 37.86.1807; or

            (b) if there is no fee in (11)(a), the amount determined by multiplying the

by-report rate provided in (8)(b) by the billed charges.

            (12) (8) Subject to the provisions of (12)(8)(a), when billed with a modifier, payment for procedures established under the provisions of (7) is a percentage of the rate established for the procedures.

            (a) through (a)(iii) remain the same.

            (13) and (14) remain the same, but are renumbered (9) and (10).

 

AUTH: 53-2-201, 53-6-113, MCA

IMP:     53-2-201, 53-6-101, 53-6-111, 53-6-113, 53-6-125, MCA

 

            37.86.101 PHYSICIAN SERVICES, DEFINITIONS (1) through (6) remain the same.

            (7) Payment-to-charge ratio means the percent determined by dividing the previous state fiscal year's total Medicaid reimbursement for RBRVS provider covered services as defined in ARM 37.85.212 by the previous state fiscal year's total Medicaid charges for RBRVS provider covered services. The effective date and payment-to-charge ratio are as provided in ARM 37.85.105(2).

 

AUTH: 53-6-113, MCA

IMP:     53-6-101, 53-6-113, 53-6-141, MCA

 

            37.86.105 PHYSICIAN SERVICES, REIMBURSEMENT/GENERAL REQUIREMENTS AND MODIFIERS (1) through (3) remain the same.

            (4) Reimbursement to physicians for physician-administered drugs which are billed under HCPCS "J" and "Q" codes is made according to the department's fee schedule or the provider's usual and customary charge, whichever is lower. The department's fee schedule is updated at least annually based upon:

            (a) through (c) remain the same.

            (d) the by-report amount as defined in ARM 37.85.212 the Medicaid fee as determined in (7).

            (5) and (6) remain the same.

            (7) A Medicaid fee is determined for physician services and anesthesia services as defined at ARM 37.85.212 and birth attendant services as defined at ARM 37.86.1201 for services without fees.

             (a) The Medicaid fee is determined for procedure codes that are new (less than one year in existence), or have no or low utilization, or have inconsistent charges by reviewing cost information for the service if available, or by reviewing the reimbursement of similar services if cost information is not available.

             (b) Otherwise, the Medicaid fee in (7) is determined by multiplying the average charge for the service by the payment-to-charge ratio.

(7) remains the same, but is renumbered (8).

 

AUTH: 53-6-101, 53-6-113, MCA

IMP:     53-6-101, 53-6-113, MCA

 

37.86.1201 BIRTH ATTENDANT SERVICE (1) and (2) remain the same.

(3) Reimbursement for birth attendants will be determined in accordance with ARM 37.85.212 for allied service providers and 37.86.105.

            (4) The definitions found in the introduction to Physicians Current Procedural Terminology, fourth edition (CPT4), published by the American Medical Association of Chicago, Illinois and adopted at ARM 37.86.101 describe the terms commonly used by the Montana Medicaid Program in implementation of the program's birth attendant fee schedule.

            (5)  The "Physician-Related Services Manual" adopted at ARM 37.86.101 governs the administration of the Birth Attendant Program.

 

AUTH: 53-2-201, 53-6-113, MCA

IMP:     53-6-101, MCA

 

            37.86.3205 NONHOSPITAL LABORATORY AND RADIOLOGY (X-RAY) SERVICES, REIMBURSEMENT (1) through (3) remain the same.

            (4) For clinical laboratory services, the department pays the lower of:

            (a)  the provider's usual and customary charges for the service;

            (b) 60% of the Medicare fee schedule for physician offices and independent labs and hospitals functioning as independent labs; or

            (c) the Medicaid fee as determined at ARM 37.86.105(7) if there is no fee determined at (4)(b).

 

AUTH: 53-6-113, MCA

IMP:     53-6-113, 53-6-141, MCA

 

            37.87.901 MEDICAID MENTAL HEALTH SERVICES FOR YOUTH, REIMBURSEMENT (1) Medicaid reimbursement for mental health services shall will be the lowest of:

            (a) and (b) remain the same.

            (2) For services for which Medicare does not specify Relative Value Unit (RVU) as provided in ARM 37.87.212, the department determines the Medicaid fee for children's mental health services as follows:

            (a) if there is use resulting in Medicaid reimbursements totaling at least $10,000 in a state fiscal year (SFY), and a minimum of four separate providers have billed the code, then the Medicaid fee is determined by multiplying the average charges by the payment-to-charge ratio; or

            (b)  if there is use resulting in Medicaid reimbursements totaling less than $10,000 in an SFY and fewer than four separate providers have billed the code in an SFY, the Medicaid fee will be determined by:

            (i)  reviewing similar procedure codes within the same service scope and adjusting the rate to be equal to a comparable procedure code or the average of similar procedure codes if there is more than one; or

            (ii)  reviewing similar procedure codes within the same service scope and adjusting the rate to be equal to a comparable procedure code or the average of similar codes plus 10% when severity is higher or increased resources are needed for the service. If the code is determined to have a lower severity component or fewer resources are required than when compared to the similar procedure code or average of similar procedure codes, the rate will equal the comparable procedure code or average of similar procedure codes less 10%.

 

AUTH: 53-2-201, 53-6-113, MCA

IMP:     53-2-201, 53-6-101, 53-6-111, MCA

 

            37.88.907 MENTAL HEALTH CENTER SERVICES FOR ADULTS, REIMBURSEMENT (1) through (7) remain the same.

            (8) For services for which Medicare does not specify Relative Value Unit as provided in ARM 37.85.105, the department determines the Medicaid fee for adult mental health services as follows:

            (a) if there is use resulting in Medicaid reimbursements totaling at least $10,000 in a state fiscal year (SFY), and a minimum of four separate providers have billed the procedure code, then the Medicaid fee is determined by multiplying the average charges by the payment-to-charge ratio;

            (b) if there is use resulting in Medicaid reimbursements totaling less than $10,000 in an SFY and fewer than four separate providers have billed the procedure code in an SFY, then the Medicaid fee will be determined by:

            (i) reviewing similar procedure codes within the same service scope and adjusting the rate to be equal to a comparable procedure code or the average of similar procedure codes if there is more than one; or

            (ii) reviewing similar procedure codes within the same service scope and adjusting the rate to be equal to a comparable procedure code or the average of similar codes plus 10% when severity is higher or increased resources are needed for the service. If the code is determined to have a lesser severity component or fewer resources are required than when compared to the similar procedure code or average of similar procedure codes, the reimbursement rate will equal the comparable procedure code or average of similar procedure codes less 10%.

 

AUTH: 53-2-201, 53-6-113, MCA

IMP:     53-2-201, 53-6-101, 53-6-111, 53-6-113, MCA

 

            4. STATEMENT OF REASONABLE NECESSITY

 

The Department of Public Health and Human Services (the department) is proposing amendments to ARM 37.85.212, 37.86.101, 37.86.105, 37.86.1201, 37.86.3205, 37.87.901, and 37.88.907 pertaining to the By Report Procedure Codes and the methodology used to determine reimbursement rates. These proposed amendments affect three divisions' rules within the department: Health Resources Division (HRD); Developmental Services Division, Children's Mental Health Bureau (CMHB); and the Addictive and Mental Disorders Division (AMDD), Mental Health Services Bureau.

 

The Centers for Medicare and Medicaid Services (CMS) will no longer allow "by report" reimbursement methodology effective July 1, 2014. "By report" reimbursement methodology means paying a percentage of the charges listed for a service on a claim line. These rule amendments remove "by report" language in the RBRVS rule and replaces it with approvable reimbursement methodology in the HRD, AMDD and CMHB rules. The proposed rule is necessary for the department to administer and maintain compliance with federal funding requirements.

 

Proposed Amendments to HRD Rules

 

ARM 37.85.212, 37.86.101 and 37.86.105

 

The department is proposing to remove "by report" reimbursement language from the RBRVS rule and replace it with "payment-to-charge ratio" and an approvable reimbursement methodology in the physician rules.

 

ARM 37.86.1201

 

The department is proposing to incorporate current procedural terminology (CPT) and the provider manual into the birth attendant rule.

 

ARM 37.85.212 and 37.86.3205

 

The department is proposing to move lab reimbursement language from the RBRVS rule to the lab rule.

 

Fiscal Impact

 

No fiscal impact is expected.

 

Proposed Amendments to CMHB Rules

 

ARM 37.87.901

 

Effective July 1, 2014, the Center for Medicare and Medicaid Services (CMS) no longer allows the department to use the "pay by report" method of reimbursing new codes established in the Current Procedural Terminology (CPT) manual.  The department is proposing the method to price new CPT codes when an assigned Relative Value Units (RVU) has not been established by Medicare.  This amendment is necessary to comply with CMS.

 

Proposed Amendments to AMDD Rules

 

ARM 37.88.907

 

For reimbursements totaling over $10,000 and having a minimum of four separate providers billing the procedure code, the department is proposing that the fee will be determined by multiplying the average charges by the payment to ratio. For procedure codes with less than $10,000 and fewer than four providers, the reimbursement rate will be determined by either:

            a. reviewing similar procedure codes with the same service scope and adjusting the rate to be equal to comparable procedure codes or the average of similar codes; or

            b. reviewing similar procedure codes and adjusting the rate to be equal to comparable procedure codes, or an average plus 10%, if the severity is higher or increased resources are needed to provide the service. However, if the code is determined to have a lesser component or less resources are required, the reimbursement rate will equal the comparable procedure code or average of similar codes less 10%.

 

            5. The department intends to adopt these rule amendments effective July 1, 2014.

 

            6. Concerned persons may submit their data, views, or arguments either orally or in writing at the hearing. Written data, views, or arguments may also be submitted to: Kenneth Mordan, Department of Public Health and Human Services, Office of Legal Affairs, P.O. Box 4210, Helena, Montana, 59604-4210; fax (406) 444-9744; or e-mail [email protected], and must be received no later than 5:00 p.m., May 22, 2014.

 

7. The Office of Legal Affairs, Department of Public Health and Human Services, has been designated to preside over and conduct this hearing.

 

8. The department maintains a list of interested persons who wish to receive notices of rulemaking actions proposed by this agency.  Persons who wish to have their name added to the list shall make a written request that includes the name, e-mail, and mailing address of the person to receive notices and specifies for which program the person wishes to receive notices. Notices will be sent by e-mail unless a mailing preference is noted in the request. Such written request may be mailed or delivered to the contact person in 6 above or may be made by completing a request form at any rules hearing held by the department.

 

9. An electronic copy of this proposal notice is available through the Secretary of State's web site at http://sos.mt.gov/ARM/Register.  The Secretary of State strives to make the electronic copy of the notice conform to the official version of the notice, as printed in the Montana Administrative Register, but advises all concerned persons that in the event of a discrepancy between the official printed text of the notice and the electronic version of the notice, only the official printed text will be considered.  In addition, although the Secretary of State works to keep its web site accessible at all times, concerned persons should be aware that the web site may be unavailable during some periods, due to system maintenance or technical problems.

 

10. The bill sponsor contact requirements of 2-4-302, MCA, do not apply.

 

11. With regard to the requirements of 2-4-111, MCA, the department has determined that the amendment of the above-referenced rules will not significantly and directly impact small businesses.

 

/s/ John C. Koch                                          /s/ Richard H. Opper                                   

John C. Koch                                               Richard H. Opper, Director

Rule Reviewer                                               Public Health and Human Services

           

Certified to the Secretary of State April 14, 2014.