HHSC Medical Care Advisory Committee

November 10, 2011 | News & Policy

Download this report as a PDF

Opening Comments  were made by  Michael Vaclav, DDS, Medical Care Advisory Committee Chair.

Comments from the Associate Commissioner – Billy Millwee, Medicaid and Children’s Health Insurance Program (CHIP) Associate Commissioner, Health and Human Services Commission (HHSC)

Mr. Millwee recently returned from a meeting between the state Medicaid Directors and the Centers for Medicare and Medicaid Services (CMS) where the principle topic was dual eligible.  Mr. Milwee stated that STAR+Plus should address the issues raised at the meeting by CMS.

Mr. Millwee announced changes in the Executive team at HHSC.  In a statement from the Executive Commissioner, it was announced that  Mr. Millwee will take on the role of Deputy Executive Commissioner for the Office of Health Services.  Mr. Millwee has been the State Medicaid Director for the past two years and he will continue to oversee Medicaid/CHIP. His primary focus will be on Medicaid and CHIP operations and how to continue to make those programs more effective. He also will oversee the Center for Program Coordination for Children & Youth, the Medical Transportation Program, Frew activities, and policy.

Dr. Mark Chassay will join HHS on January 1 as the Deputy Executive Commissioner for the Office of Health Policy and Clinical Services. This new position will focus on coordinating health and clinical policy across the health and human services system to ensure a coordinated approach to medical policy. Dr. Chassay comes to HHSC from his post as Head Team Physician and Chief Medical Officer at the University of Texas at Austin. He is a recognized leader in the field of family and sports medicine and in 2010 he served as the president of the Travis County Medical Society.  He has a bachelor’s degree from the University of Texas at Austin and a medical degree from the University of Texas Medical School at Houston. In his new role, Dr. Chassay will oversee the HHSC Office of the Medical Director, Office of e-Health Coordination, Office of Acquired Brain Injury, the Office of Informal Dispute Resolution, health policy and he will work closely with the new Texas Health Care Quality Institute

Katie Olse will take on the role of Chief of Staff effective November 1.  Ms. Olse has been serving as the Deputy Chief of Staff since June.

Stephanie Muth will take over as Deputy Executive Commissioner for the Office of Social Services effective November 1.  Ms. Muth has been Chief of Staff, and she has been leading the effort to modernize the eligibility system.

Mr. Milwee commented on the progress of several initiatives.  Managed care expansion is right on schedule, with the majority of the initiatives scheduled for implementation March 1, 2012.  “Your Texas Benefits Card” roll out of phase one is complete and phase two will set the stage for sharing health records.  Regarding payments related to Health Information Exchange preparedness by health care providers, Mr. Milwee announced that Texas had distributed in excess of $200 million.  This is more than any other state.

He 1115 waiver, to secure managed care expansion without losing Upper Payment Limit (UPL) payments to hospitals is in negotiation and will hopefully conclude successfully the week of November 14.

Approval of Sept. 2011 Minutes:  The minutes were approved unanimously

Discussion of Upcoming Managed Care Rule Changes – Billy Millwee, Medicaid and CHIP Associate Commissioner, HHSC,  Including changes to address the issues enumerated below:  The MCAC was not presented with a rule packet as they had not been completed yet.  MCAC will receive a full presentation on the proposed changes at the next meeting.  The Committee discussed the 15 day default provision and was assured that this was only used when a member has not chosen a provider, and in that case one is chosen for them.  The providers for the member are selected by which provider has under enrollment (15,000 or less) and then it is a round robin approach.  Similarly the lock in provision is only used under specific circumstances.

a. The capitation of Medicaid primary and preventative dental care for children; Right now, children enrolled in the Children’s Health Insurance Program (CHIP) get managed care dental services through a dental plan. Beginning March 1, 2012, most children and young adults age 20 and younger enrolled in Medicaid also will start getting dental services through a dental plan. There will be three dental plans to choose from. Some people will continue to get dental services the same way they do now:

• People with Medicaid age 21 and older
• All Medicaid clients, regardless of age, who live in Medicaid-paid facilities such as nursing homes, state supported living centers, or Intermediate Care Facilities for Mentally Retarded Persons (ICFs/MR)
• Children and young adults in the state’s foster care program who are enrolled in STAR Health

b. The carve-in of Medicaid and CHIP prescription drug benefits; Beginning March 1, 2012, people with Medicaid managed care or CHIP will get pharmacy benefits through a managed care plan. Providers that wish to participate in managed care networks should contact the managed care organizations in each service area for information about their pharmacy benefits managers.

c. Implementation of a 12 month lock-in period;  Federal law allows states to lock in members for up to 12 months, to reduce provider uncertainty and to ensure proper care for members.   During this time members may request to change managed care organizations (MCOs) under limited circumstances;

d. Requirements for MCOs’ special investigative units and fraud and abuse recoveries;   The existing rules in Chapter 371 include various provisions to ensure Medicaid and other health and human services (HHS) program integrity by discovering, preventing, and correcting fraud, waste, and abuse within the medical assistance program in Texas.

The proposal involves the rules in Chapter 371, Subchapter G, which describe program violations and govern the administrative actions and sanctions the Health and Human Services Commission’s (HHSC’s) Office of Inspector General (OIG) can take against a provider or person in response to a program violation. The rulemaking action proposes to repeal the existing rules in Subchapter G and replace them with new rules.

The proposed new rules in Chapter 371 are updated in light of recent state and federal legislation. Moreover, the new rules are being proposed to delete unnecessary language, revise or eliminate obsolete terminology, and to provide better and more helpful organization. The new rules do not substantially change current HHSC-OIG policy related to providers’ substantive rights or the procedural due process afforded them.

Updated provisions include:

• New Section 371.1651 which reflects the requirements that providers who have certain affiliations, are terminated by other states’ Medicaid or CHIP programs, who have been convicted of a criminal offense related to involvement in Medicaid, Medicare, or a Title XXI program in the last ten years, or who do not pass new provider screening measures be terminated     ;
• New Section 371.1653 that incorporates the requirement that the national provider number of supervising and supervised practitioners be included in claims for payment for services and the requirement that Durable Medical Equipment and home health providers conduct in-person evaluations every 12 months;
• New Section 371.1655 that incorporates the new requirement that CHIP providers who fail to repay overpayments or who are affiliated with and who control a prohibited provider be terminated , and requires that providers establish a compliance program for detecting criminal, civil and administrative violations and that promotes quality of care, and that incorporates the new requirement that providers who are inactive for a period of 12 months be terminated from enrollment;
• New Section 371.1657 that adds specific prohibitions against the misuse and improper transmission of protected health information;
• New Section 371.1663 that incorporates requirements related to MCO investigation, recovery and reporting of fraud and;
• New Section 371.1703 that incorporates grounds for mandatory termination from program participation;
• New Section 371.1709 that incorporates requirements for mandatory payment holds upon receipt of reliable evidence that the circumstances giving rise to the hold involve provider fraud or willful misrepresentation;
• New Section 371.1715 that incorporates the authorization that allows OIG to impose penalties for any program violation committed knowingly and for failure to maintain documentation to support a claim for payment in accordance with program requirements;

e. Recent legislation and federal waiver requirements;  mentioned previously

f. Clerical corrections and other changes necessary to implement managed care policy.

Rate Analysis Discussion – Carolyn Pratt, Rate Analysis, HHSC;  Ms. Pratt presented an overview of the rate process.  Hand out of the rate process overview is available upon request.

Emergency Department Usage – Billy Millwee, Medicaid and CHIP Associate Commissioner, HHSC.  HHSC is taking steps to reduce non-emergency use of emergency room care as required by the Legislature in Senate Bill 7.  As part of this effort, HMOs are being required to have urgent care networks and in 2012 to have urgent care look-up.  Five percent of premiums will be at risk based on performance.  Incentives for reduction of physician payments related to inappropriate emergency room use have been in place for 10 years.  Client strategies are also being implemented by HMOs in the form of patient education.  Mr. Millwee pointed out that since high quality care is provided in emergency rooms, sometimes patients make the rational decision to use these services over less costly services.  The MCAC discussed the possibility for co-pays.  Mr. Millwee stated that co-pays are a possibility and a matter of timing.  All agreed that no one wanted the urgent care clinics to become the new medical home for patients.

NOTICE OF PROPOSED RULES/ACTION ITEMS:

Web-based cost reporting was presented by Judy Myers, HHSC.  HHSC proposes to amend §355.101, Introduction, and §355.107, Notification of Exclusions and Adjustments under Title 1, Part 15, Chapter 355, Subchapter A, to adopt a formal definition for the term “line item” and eliminate a reference to auditors.

HHSC is implementing a web-based cost-reporting system (DOC), the State of Texas Automated Information and Reporting System (STAIRS), to replace its existing cost-reporting system. The current cost-reporting system identifies each data item by an item number, making it clear that the term “line item” refers to a numbered item on the cost report.  STAIRS does not have item numbers.  With the elimination of line item numbers under the STAIRS system, a definition of “line item” to accommodate both the current cost-reporting system and the new STAIRS system is needed to avoid confusion and misinterpretation.

Additionally, HHSC is modifying its cost report audit process to focus more audit resources on high-risk cost reports identified through various risk assessment procedures.  The rule proposal deletes a reference to “auditors” since both audit and non-audit HHSC staff will now be finalizing cost report desk reviews.

The proposal was approved by MCAC.

Cost reporting requirements were presented by Pam McDonald.  HHSC proposes to amend §355.105, concerning General Reporting and Documentation Requirements, Methods, and Procedures; §355.112, concerning Attendant Compensation Rate Enhancement; §355.308, concerning Direct Care Staff Rate Component; §355.503, concerning Reimbursement Methodology for the Community-Based Alternatives Waiver Program and the Integrated Care Management-Home and Community Support Services and Assisted Living/Residential Care Programs; §355.505, concerning Reimbursement Methodology for the Community Living Assistance and Support Services Waiver Program; and §355.5902, concerning Reimbursement Methodology for Primary Home Care.

Sections 355.105, 355.112, 355.308, 355.503, 355.505, and 355.5902 establish cost reporting requirements and reimbursement methodologies (DOC) for various long term services and supports programs administered by the Department of Aging and Disability Services. HHSC proposes to amend these rules to: 1) formalize certain existing practices; 2) clarify due dates for consolidated cost reports; 3) change how entities request that their cost reports be aggregated for purposes of determining compliance with Attendant Compensation Rate Enhancement (the Enhancement) spending requirements; 4) eliminate the requirement that all contracts in an aggregated group participate in the Enhancement at the same level; and 5) allow providers subject to a recoupment for failure to meet Enhancement spending requirements on a specific Attendant Compensation Report, and providers subject to recoupment for failure to meet Direct Care Staff Rate staffing and/or spending requirements on a specific Staffing and Compensation Report, to, in certain situations, request that HHSC recalculate their recoupment after combining that report with the provider’s next full-year cost report. Additional changes are proposed throughout the rules to update terms, remove obsolete or incorrect language, and clarify language.

The MCAC was concerned that under the proposed system, double recoupment could be made against a provider.  Ms. McDonald reported that this has not been the case in the past, but there would be a possibility with the system about to change.  She agreed that HHSC would discuss this issue with the Office of the Inspector General (OIG).

The proposal was approved by MCAC.

Hospital reimbursement adjustments were presented by Chris Dockal, HHSC.  HHSC proposes to repeal 355.8064 under Title 1, Part 15, Chapter 355, Subchapter J, concerning Reimbursement Adjustment for Hospitals Providing Inpatient Services (DOC) to supplemental security income (SSI) and SSI-Related Clients, concurrent with the initiative to expand Medicaid managed care statewide effective March 1, 2012.  The statewide managed care expansion was authorized in the 2012-13 General Appropriations Act (Article II, HHSC, Rider 51, House Bill 1, 82nd Legislature, Regular Session, 2011).  This rule was implemented as a cost savings initiative based on the 2006-07 General Appropriations Act (Article II, Special Provisions, Section 49, Senate Bill 1, 79th Legislature, Regular Session, 2005) (Act), which directed HHSC to achieve savings for services provided to Medicaid aged, blind, and disabled clients in the following service areas: Bexar, Dallas, El Paso, Harris, Lubbock, Nueces, Tarrant, and Travis.  With the planned Medicaid managed care expansion effective March 1, 2012, HHSC will no longer continue to carve out inpatient hospital services in the managed care service areas.  With inpatient services no longer carved out of managed care, the original savings will be achieved within managed care rather than through the eight percent reduction to Medicaid fee-for-service payments for inpatient hospital services.

While the item was not formally presented to the Hospital Payment Advisory Committee, it was reported that it was generally supported by them.  There is no fiscal impact anticipated.

The proposal was approved by MCAC.

Fraud, waste and abuse detection and prevention was presented by Mike McMillen, HHSC, OIG.  HHSC proposes to repeal and replace, Subchapter G, Legal Action Relating to Providers of Medical Assistance under Title 1, Part 15, Chapter 371, concerning administrative actions and sanctions.  The existing rules in Subchapter G include various provisions to ensure Medicaid and other health and human services agency program integrity by discovering, preventing, and correcting fraud, waste, and abuse within Medicaid (DOC) in Texas. The proposed new rules in Subchapter G are updated in light of recent state and federal legislation. The new rules are being proposed to delete unnecessary language, revise or eliminate obsolete terminology, and to provide better and more helpful organization. Unless otherwise indicated in this proposal, the new rules do not substantially change current HHSC Office of Inspector General policy related to providers’ substantive rights or the procedural due process afforded them.  MCAC had some concerns about the definitions that were being used for “potential fraud” and who would make that determination.  A motion was made to NOT approve the proposal and that motion failed 5-3. A motion to approve with reservations passed unanimously.

Specialty drug definition was presented by Andy Vasquez, HHSC, Vendor Drug.  HHSC proposes new §354.1853, Specialty Drugs, under Title 1, Part 15, Chapter 354, Subchapter F, Division 3.  Section 1.02(d), Senate Bill 7, 82nd Legislature, First Called Session, 2011, amends Texas Government Code §533.005(a) by adding paragraph (23)(G) to define specialty drugs (DOC).  Medicaid MCOs and subcontracted pharmacy benefit managers will be required to adhere to this definition when reclassifying prescription drugs from retail to specialty drugs.  This rule will not affect the fee-for-service Vendor Drug Program (VDP) at this time because VDP does not reimburse specialty drugs differently from other drugs and does not contract out for specialty drugs.  The definition will impact VDP if VDP ever contracts separately for specialty drugs or establishes a different payment methodology for specialty drugs.

There was testimony from the Texas Pharmacy Business Council (TPBC).  The TPBC wanted the proposal to include a provision that would put HHSC in control of the definition; that a specialty drug would have to meet all the criteria and not just one of them; there would be a notice and dispute resolution process; allowances for exclusions; and Pharmacy Benefit Managers and Managed Care providers would have to submit their proposals to HHSC for approval.

There was a $1500 threshold in the proposal and MCAC asked HHSC to look at make that threshold a $3000 threshold instead.

The proposal was approved by MCAC.

The next scheduled meetings of the MCAC will be February 9, May 10, August 9 and November 8 in 2012.  The meetings will be held in the Winters Building, in Austin.

There being no further business, the meeting was adjourned.

by Tom Valentine