BEFORE THE DEPARTMENT OF PUBLIC

HEALTH AND HUMAN SERVICES OF THE

STATE OF MONTANA

 

In the matter of the amendment of ARM 37.86.2901, 37.86.2925, 37.86.2928, 37.86.2931, and 37.86.2932 pertaining to the discontinuance of the supplemental disproportionate share hospital payment

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NOTICE OF PUBLIC HEARING ON PROPOSED AMENDMENT

 

TO: All Concerned Persons

 

            1. On April 5, 2018, at 1:30 p.m., the Department of Public Health and Human Services will hold a public hearing in Room 207 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 the Department of Public Health and Human Services no later than 5:00 p.m. on March 21, 2018, 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:

 

            37.86.2901 INPATIENT HOSPITAL SERVICES, DEFINITIONS (1) through (41) remain the same.

            (42) "Supplemental disproportionate share hospital" means a hospital in Montana which meets the criteria in ARM 37.86.2925 and 37.86.2931.

            (43) through (48) remain the same, but are renumbered (42) through (47).

 

AUTH:  53-2-201, 53-6-113, MCA

IMP:  53-2-201, 53-6-101, 53-6-111, 53-6-113, 53-6-141, 53-6-149, MCA

 

            37.86.2925 INPATIENT HOSPITAL REIMBURSEMENT, DISPROPORTIONATE SHARE HOSPITAL (DSH) PAYMENTS (1) remains the same.

            (2) Subject to federal approval and the availability of sufficient state special revenue, all supplemental disproportionate share hospitals (SDSH) will receive a SDSH payment. In order to maintain access and quality in the most rural areas in Montana, critical access hospitals will receive an increased portion of the available funding. The SDSH payment will be calculated using the formula: SDSH = (M ÷ D) x P.

            (a) For the purposes of determining SDSH payment amounts, the following definitions apply:

            (i) "SDSH" represents the calculated supplemental disproportionate share hospital amount.

            (ii) "M" represents the number of weighted Medicaid paid inpatient days provided by the hospital for which the payment amount is being calculated.

            (A) For critical access hospitals, weighted Medicaid inpatient days equals the number of Medicaid inpatient days provided multiplied by 3.8.

            (B) For all other hospitals, weighted Medicaid inpatient days equals the number of Medicaid paid inpatient days provided.

            (iii) "D" equals the total number of weighted Medicaid paid inpatient days provided by all SDSHs in Montana.

            (iv) "P" equals the unexpended, unencumbered disproportionate share hospital (DSH) allotment for Montana, as determined by the federal Centers for Medicare and Medicaid Services (CMS) according to section 1923 of the Social Security Act, remaining after routine DSH payments have been calculated according to (1), plus the state financial participation.

            (v) The figures used in (2)(a)(ii) and (iii) must be from the department's paid claims data for the hospital's fiscal year that ended in the most recent calendar year that ended at least 12 months prior to the calculation of the HRA payments.

            (3) (2)  DSH payments, including RDSH payments and SDSH payments, will be limited to the cap established by CMS for the state of Montana. The adjustment percentages specified in (1) will be ratably reduced as determined necessary by the department to avoid exceeding the cap.

            (a) through (f) remain the same.

            (4) (3)  Eligibility for RDSH and SDSH payments will be determined based on a provider's year-end reimbursement status.

 

AUTH:  2-4-201, 53-2-201, 53-6-113, MCA

IMP:  2-4-201, 53-2-201, 53-6-101, 53-6-111, 53-6-113, MCA

 

            37.86.2928 INPATIENT HOSPITAL REIMBURSEMENT, HOSPITAL REIMBURSEMENT ADJUSTOR (1) remains the same.

            (2) Part 1 of the HRA payment will be based upon Medicaid inpatient utilization, and will be computed as follows: HRA1 = (M ÷ D) x P.

            (a) For the purposes of calculating Part 1 of the HRA, the following apply:

            (i) through (iii) remain the same.

            (iv)  "P" equals the total amount to be paid via Part 1 of the HRA. "P" consists of a state-paid amount plus the applicable federal financial participation (FFP). The portion of "P" that is paid by the state will equal the amount of revenue generated by Montana's hospital utilization fee, less all of the following:

            (A) the amount expended as match for supplemental DSH payments as provided in ARM 37.86.2925;

            (B) and (C) remain the same, but are renumbered (A) and (B).

            (3) remains the same.

 

AUTH:  2-4-201, 53-2-201, 53-6-113, MCA

IMP:  2-4-201, 53-2-201, 53-6-101, 53-6-111, 53-6-113, 53-6-149, MCA

 

            37.86.2931 ROUTINE AND SUPPLEMENTAL DISPROPORTIONATE SHARE HOSPITAL (1) through (3) remain the same.

            (4) A hospital is deemed a supplemental disproportionate share hospital if it meets the criteria in (1)(b), (2), and (3).

 

AUTH:  2-4-201, 53-2-201, 53-6-113, MCA

IMP:  2-4-201, 53-2-201, 53-6-101, 53-6-111, 53-6-113, 53-6-149, MCA

 

            37.86.2932 MEDICAID UTILIZATION RATE (1) and (2) remain the same.

            (3) The period used to determine whether a hospital is deemed a supplemental disproportionate share hospital will be the same period used to calculate the amounts of the supplemental DSH payments, as provided in ARM 37.86.2925.

            (a) An inpatient day includes each day in which an individual, including a newborn, is an inpatient in the hospital, whether or not the individual is in a specialized ward or whether or not the individual remains in the hospital for lack of suitable placement elsewhere.

 

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 (department) is proposing amendments to discontinue supplemental disproportionate share hospital payments.

 

The department is proposing this rule amendment to increase the Hospital Reimbursement Adjustor (HRA) supplemental payment and discontinue the Supplemental Disproportionate Share Hospital (DSH) payment to in-state hospitals. With the implementation of Medicaid Expansion, Montana hospitals experienced a decrease in uncompensated care and an increase in reimbursed care to Medicaid members due to an increase in Medicaid Expansion enrollment. By discontinuing the supplemental DSH payment and increasing the HRA supplemental payments to in-state hospitals, the department can leverage funds generated as a result of increased federal medical assistance and use those dollars for HRA supplemental payments to Montana hospitals. The changes described below are proposed in order to effectuate the discontinuation of supplemental DSH payments to Montana hospitals.

 

ARM 37.86.2901(42)

 

The department proposes to remove the definition of supplemental disproportionate share hospital.

 

ARM 37.86.2925(2) and (3)

 

The department proposes to remove (2) and remove references in (3) to supplemental DSH.

 

ARM 37.86.2928(2)(iv)(A)

 

The department proposes to remove this subsection as we will no longer use a portion of hospital utilization fee (HUF) to match supplemental DSH.

 

ARM 37.86.2931(4)

 

The department proposes to eliminate the criteria to be a supplemental disproportionate share hospital.

 

ARM 37.86.2932(3)

 

The department proposes to remove reference information regarding determining qualification of being supplemental disproportionate share hospital.

 

The federal upper payment limit (UPL) determines the cumulative increase in supplemental payments to in-state hospitals, which as of February 2018 is estimated at $2,347,000 for SFY2018. If the UPL increases, the impact of this change will increase. There are 61 in-state hospitals that are affected by this proposal; however the cumulative increase will be distributed using a formula based on utilization and therefore each hospital’s individual increase will vary.

 

            5. The department intends to apply these rule amendments retroactively to March 6, 2018.

 

            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: Todd Olson, 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., April 13, 2018.

 

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

 

10. 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.

 

11. Section 53-6-196, MCA, requires that the department, when adopting by rule proposed changes in the delivery of services funded with Medicaid monies, make a determination of whether the principal reasons and rationale for the rule can be assessed by performance-based measures and, if the requirement is applicable, the method of such measurement. The statute provides that the requirement is not applicable if the rule is for the implementation of rate increases or of federal law.

 

The department has determined that the proposed program changes presented in this notice are not appropriate for performance-based measurement and therefore are not subject to the performance-based measures requirement of 53-6-196, MCA.

 

 

 

/s/ Brenda Elias                                            /s/ Sheila Hogan                                         

Brenda Elias, Attorney                                 Sheila Hogan, Director

Rule Reviewer                                             Public Health and Human Services

 

 

Certified to the Secretary of State March 6, 2018.