Provision

Estimated Savings

Suspends Automatic increase for nursing facility property rates.

($1,045,000)

*Low Needs Case Mix reduction of 25% of the operating payment rates for categories PA1 and BC1.

($17,367,000)

*Modify non-base rate payments to nursing facilities. This includes:

• Elimination of planned closure rate adjustments.
• Bed Hold payment reduction from 60% to 30% and increased eligibility to 96%.
• We believe (although the language isn’t included in the initial bill) it also includes reduction of enhanced rate for first 30 days from 20% to 10% and some form of reduction for single room payments.

($16,141,000)

High Rate Facility Cuts—Reduces rates by 5% at the 95th percentile and redistributes those funds somehow to lower rate facilities.

Budget neutral overall but cuts to roughly 25 nursing facilities.

Repeal of Rate Equalization—effective July 1, 2011 without any phase-out period or restrictions.

$714,000

Appropriation Cap for all Waivers—5% of the waiver amounts is set aside for emergency situations. The following options are available to the DHS commissioner to meet the funding limits of the caps:

• Reduce or adjust benefits and services
• Reduce or adjust case-mix capitation rates
• Limit or freeze waiver enrollment
• Establish needed thresholds for service eligibility
• Adjust eligibility criteria to the extent allowable under federal regulations
• Establish prior authorization criteria
• Adjust home and community-based waiver allocations as needed, with the use of waiver slots prioritized for individuals anticipated to be discharged from an institutional setting or who are at imminent risk of an institutional placement.

If the application of all the methods mentioned above will not achieve the needed cost savings, the commissioner may reduce provider payment rates by the amount necessary.

($483,067,000) over the biennium with approximately ($67,091,000) coming from the elderly waiver (fee for services and managed care) and ($248,912,000) coming from the CADI waiver.

Allocation of Waiver slots—Community Alternatives for Disabled Individuals (CADI) is limited to 85 allocations per month for the biennium.

Global Waiver—If the implementation of a global waiver that would merge all the waiver programs together does not generate an unspecified additional $300,000,000 of savings, all budgeted for July 1, 2012 to June 30, 2013, the Commissioner shall reduce provider payment rates by the amount necessary to recoup the shortfall in savings. 

($300,000,000)

The case mix cap for Elderly Waiver is separated from nursing facility rates, which means that in the future when nursing facility rates increase (whether operating or property rates), the elderly waiver rate will not.

($1,239,000)

Case Mix L Changes—The budget caps for Elderly Waiver Case Mix L individuals will be cut from $2272/month to $1750/month. Service rate limits will also be reduced. While the needs of these individuals will not have changed, providers will be expected to meet those needs with significantly fewer resources.

Provider of CAC, CADI, DD, TBI Waivers—Reductions of 10% in dollars available for services for individuals with lower needs, except for family foster care providers. Effective for rates in effect on January 1, 2011. 

($12,335,000)

*Aging Grants for Community Service/Service Development—grants are continued at the reduced level.

($7,200,000)

Regulatory Reforms:

• Certified nursing homes and boarding care homes would be exempt from state licensing requirements;
• Health facility licensing duties will be transferred from the Department of Health to the Department of Human Services;
• Extension of the deadline for compliance with the elevator code for an additional three years;
• Health Department must accept electronic transmissions for nursing assistant registry;
• Requirements for counties to process medical assistance applications within established timelines;
• Seventy-five percent of the total payment for each county for long-term care consultation services must be paid monthly by certified nursing facilities in the county. Presumably the nursing facility keeps the other 25%.