PDD-02-15-00007-EP Direct Care and Clinical Compensation Payments
1/14/15 N.Y. St. Reg. PDD-02-15-00007-EP
NEW YORK STATE REGISTER
VOLUME XXXVII, ISSUE 02
January 14, 2015
RULE MAKING ACTIVITIES
OFFICE FOR PEOPLE WITH DEVELOPMENTAL DISABILITIES
EMERGENCY/PROPOSED RULE MAKING
HEARING(S) SCHEDULED
I.D No. PDD-02-15-00007-EP
Filing No. 1102
Filing Date. Dec. 30, 2014
Effective Date. Jan. 01, 2015
Direct Care and Clinical Compensation Payments
PURSUANT TO THE PROVISIONS OF THE State Administrative Procedure Act, NOTICE is hereby given of the following action:
Proposed Action:
Amendment of Part 641 of Title 14 NYCRR.
Statutory authority:
Mental Hygiene Law, sections 13.09(b), 41.24, 41.36(c) and 43.02
Finding of necessity for emergency rule:
Preservation of public health, public safety and general welfare.
Specific reasons underlying the finding of necessity:
The emergency adoption of these regulations, which amend rates and fees for eligible programs and services, is necessary to protect the health, safety, and welfare of individuals receiving services. The amendments support increases in salaries and related fringe benefits for direct care professionals and clinical staff providing residential habilitation services in community residences and family care homes; ICF/DD services; Specialty Hospital services; and day treatment, community habilitation, day habilitation, supported employment, prevocational and respite services.
The emergency adoption of these amendments is necessary in order to provide vital services and to comply with recently enacted state law.
Part I of chapter 60 of the laws of 2014, which is part of the 2014 – 15 enacted budget, requires OPWDD to provide funding beginning January 1, 2015 to support a 2% increase in annual salary and salary-related fringe benefits for direct care staff, and also to provide funding beginning April 1, 2015 to support a 2% increase in annual salary and salary-related fringe benefits for direct care and clinical staff.
Direct care professionals and clinical staff provide vital supports and services to protect the health, safety, and welfare of individuals with developmental disabilities in these eligible programs and services. The programs affected by these regulations have not received trend factors, COLAs or other across the board increases for several years. As a result, many providers operating these programs have been unable increase salaries or fringe benefits for direct care, support and clinical staff. Without such increases, it is more difficult for providers to maintain sufficient staffing to operate programs, and staff turnover is more likely. Without the emergency amendments, the funding for these compensation increases would be delayed and stable and sufficient staffing for the services affected by these amendments would be jeopardized.
Subject:
Direct Care and Clinical Compensation Payments.
Purpose:
To amend rate-setting for eligible services in order to implement increases in direct care and clinical compensation.
Public hearing(s) will be held at:
12:30 p.m., March 2, 2015 at Office for People with Developmental Disabilities, Counsel's Office Conference Rm., 44 Holland Ave., Albany, NY; 12:30 p.m., March 3, 2015 at Office for People with Developmental Disabilities, Counsel's Office Conference Rm., 44 Holland Ave., Albany, NY.
Interpreter Service:
Interpreter services will be made available to hearing impaired persons, at no charge, upon written request submitted within reasonable time prior to the scheduled public hearing. The written request must be addressed to the agency representative designated in the paragraph below.
Accessibility:
All public hearings have been scheduled at places reasonably accessible to persons with a mobility impairment.
Text of emergency/proposed rule:
• 14 NYCRR Part 641 is amended by the addition of a new Subpart 641-3 to read as follows:
Subpart 641-3. Direct Support and Clinical Compensation Increases.
641-3.1. Applicability. On or after January 1, 2015, rates of reimbursement for providers that operate eligible programs as defined in this Subpart will be revised to incorporate funding for compensation increases to their direct support professional employees. Such rate increases will be effective January 1, 2015. The compensation increase funding will be included in the provider's rate issued for January 1, 2015 or in a subsequent rate with the inclusion of funding in the amount necessary to achieve the same funding impact as if the rate had been issued on January 1, 2015. The compensation increase funding will be inclusive of associated fringe benefits.
641-3.2. Definitions. As used in this Subpart, the following terms shall have the following meanings:
(a) Direct support professionals are those defined as Direct Care and Support per Consolidated Fiscal Report (CFR) Appendix R and reported on the CFR under the Position Title code identifiers of 100 or 200. Contracted staff salary information will not be utilized.
(b) Clinical staff are those defined as Clinical per CFR Appendix R and reported on the CFR under the Position Title code identifier of 300. Contracted staff salary information will not be utilized.
(c) Eligible Rate Based Programs shall mean any of the following services: supervised community residences (including supervised IRAs), supportive community residences (including supportive IRAs), ICFs/DD or group day habilitation programs.
(d) Other Eligible Programs shall mean community habilitation, day treatment, supported employment, agency sponsored family care, respite and free standing respite, and prevocational services.
641-3.3. Increases for Eligible Rate Based Programs
(a) January 1, 2015 Increase. Rates for Eligible Rate Based Programs will be revised to incorporate funding for compensation increases to direct support professional employees. Such rate increases will be effective January 1, 2015. The compensation increase funding will be included in the provider's rate issued for January 1, 2015 or in a subsequent rate with the inclusion of funding in the amount necessary to achieve the same funding impact as if the rate had been issued on January 1, 2015. The compensation increase funding will be inclusive of associated fringe benefits.
(b) April 1, 2015 Increase. In addition to the compensation funding effective January 1, 2015, providers that operate supervised IRAs, including supervised community residences, supportive IRAs, including supportive community residences, ICFs/DD or group day habilitation will receive a compensation increase targeted to direct support professional and clinical employees to be effective April 1, 2015. The compensation increase funding will be inclusive of associated fringe benefits. The April 1, 2015 direct support professional compensation funding will be the same, on an annualized basis, as that which was calculated for the January 1, 2015 compensation increase and will be an augmentation to the January 1, 2015 increase.
(c) Calculations. The basis for the calculation of provider and regional direct care, support and clinical salary averages and associated fringe benefit percentages will be the data in providers' July 1, 2010 - June 30, 2011 or January 1, 2011 - December 31, 2011 CFRs.
(1) The January 1, 2015 and April 1, 2015 Direct Support Professionals compensation increase funding formula will be as follows:
(i) The annual impact of a two percent increase to 2010-11 or 2011 salaried direct care, salaried support dollars and associated fringe benefits will be calculated.
(ii) The annual impact of the two percent increase for salaried direct care dollars, salaried support dollars and associated fringe will be added to the appropriate operating components in the rate methodology. This will result in a recalculation of provider and regional average direct care wages, provider and regional average employee-related components, provider and regional average program support components, and provider and regional average direct care hourly rates.
(iii) The provider direct care hourly rate - adjusted for a wage equalization factor will be recalculated to utilize the provider average direct care hourly rate and regional average direct care hourly rate (as calculated in (ii) above).
(iv) An identification will be made of the dollar difference between the provider direct care hourly rate - adjusted for a wage equalization factor, which is in the rate in effect on 12/31/2014, and the provider direct care hourly rate- adjusted for a wage equalization factor, as calculated in (iii) above.
(v) The rate difference identified in (iv) above will be multiplied by the calculated direct care hours in the rate in effect on 12/31/2014 to calculate the additional funding generated by the direct care compensation adjustment.
(vi) The rate add-on for the compensation increase shall be determined by dividing the additional funding, as calculated in (v) above by the rate sheet units in effect on January 1, 2015.
(2) The April 1, 2015 Clinical compensation increase funding formula will be as follows:
(i) The annual impact of a two percent increase to 2010-11 or 2011 salaried clinical dollars and associated fringe benefits will be calculated.
(ii) The annual impact of the two percent increase for salaried clinical dollars and associated fringe will be added to the appropriate operating components in the rate methodology. This will result in a recalculation of provider and regional average employee-related components, and provider and regional average clinical hourly wages.
(iii) The provider clinical hourly wage - adjusted for a wage equalization factor will be recalculated to utilize the provider average clinical hourly wage and the regional average clinical hourly wage (as calculated in (ii) above).
(iv) An identification will be made of the dollar difference between the provider clinical hourly wage - adjusted for a wage equalization factor, which is in the rate in effect on 12/31/2014, and the provider clinical hourly wage- adjusted for a wage equalization factor, as calculated in (iii) above.
(v) The rate difference identified in (iv) above will be multiplied by the provider salaried clinical hours in the rate in effect on 12/31/2014 to calculate the additional funding generated by the clinical compensation adjustment.
(vi) The rate add-on for the compensation increase shall be determined by dividing the additional funding, as calculated in (v) above by the rate sheet units in effect on January 1, 2015.
(3) Rates for individuals identified by OPWDD as qualifying for specialized template populations funding shall be adjusted as follows:
(i) January 1, 2015 Increase. The fees for specialized template populations funding will be revised to incorporate funding for compensation increases to direct support professional employees. Such fee increases will be effective January 1, 2015. The compensation increase funding will be included in the provider’s fee issued for January 1, 2015 or in a subsequent fee with the inclusion of funding in the amount necessary to achieve the same funding impact as if the fee had been issued on January 1, 2015. The compensation increase funding will be inclusive of associated fringe benefits.
(ii) April 1, 2015 Increase. In addition to compensation funding effective January 1, 2015, the fees for specialized template population funding will revised to incorporate funding for a compensation increase to direct support professional and clinical employees to be effective April 1, 2015. The April 1, 2015 direct support compensation funding will be the same, on an annualized basis, as that which was calculated for the January 1, 2015 compensation increase and will be an augmentation to the January 1, 2015 increase.
(iii) Calculations.
(a) The portion of the fee that is identified as direct care and support will be increased by 2% and multiplied by the fee sheet fringe benefit percentage to calculate the additional direct support compensation increases for January first, two thousand fifteen and April first, two thousand fifteen.
(b) The portion of the fee that is identified as clinical will be increased by 2% and multiplied by the fee sheet fringe benefit percentage to calculate the additional clinical compensation increase for April first, two thousand fifteen.
641-3.4 Rates and Fees for Other Eligible Programs
(a) For a provider that operates any Other Eligible Programs, the provider's rate or fee for each such program will be revised to incorporate funding for compensation increases to their direct support professional employees. Such rate or fee increases will be effective January 1, 2015. The compensation increase funding will be included in the provider's rate or fee issued for January 1, 2015 or in a subsequent rate or fee with the inclusion of funding in the amount necessary to achieve the same funding impact as if the rate or fee had been issued on January 1, 2015. The compensation increase funding will be inclusive of associated fringe benefits.
(b) April 1, 2015 Increase. In addition to the compensation funding effective January 1, 2015, a provider that operates any Other Eligible Programs will receive a compensation increase targeted to direct support professional and clinical employees to be effective April 1, 2015. The April 1, 2015 direct care compensation funding will be the same, on an annualized basis, as that which was calculated for the January 1, 2015 compensation increase and will be an augmentation to the January 1, 2015 increase.
(c) Calculations.
(1) The portion of the rate or fee that is identified as direct care and support will be increased by 2% and multiplied by the rate or fee sheet fringe benefit percentage to calculate the additional direct care compensation increases for January 1, 2015 and April 1, 2015.
(2) The portion of the rate or fee that is identified as clinical will be increased by 2% and multiplied by the rate or fee sheet fringe benefit percentage to calculate the additional clinical compensation increase for April 1, 2015.
641-3.4 Rates and Fees for Specialty Hospitals
(a) January 1, 2015 Increase. The rates of reimbursement for specialty hospitals as defined in Part 680 of this Title will be revised to incorporate funding for compensation increases to direct support professional employees. Such rate increases will be effective January 1, 2015. The compensation increase funding will be included in the provider's rate issued for January 1, 2015 or in a subsequent rate with the inclusion of funding in the amount necessary to achieve the same funding impact as if the rate had been issued on January 1, 2015. The compensation increase funding will be inclusive of associated fringe benefits.
(b) April 1, 2015 Increase. In addition to the compensation funding effective January 1, 2015, providers that operate specialty hospitals will receive a compensation increase targeted to direct support professional and clinical employees to be effective April 1, 2015. The compensation increase funding will be inclusive of associated fringe benefits. The April 1, 2015 direct support professional compensation funding will be the same, on an annualized basis, as that which was calculated for the January 1, 2015 compensation increase and will be an augmentation to the January 1, 2015 increase.
(c) Calculations. The basis for the calculation of direct care, support and clinical salary averages will be the data from the provider’s January 1, 2011 - December 31, 2011 CFR. The fringe benefit percentage will be that fringe benefit percentage utilized in the provider’s December 31, 2014 specialty hospital rate.
(1) The January 1, 2015 and April 1, 2015 Direct Support Professional compensation increase funding formula will be:
(i) The annual impact of a two percent increase to 2011 salaried direct care and salaried support dollars and associated fringe benefits will be calculated.
(ii) The annual impact of the two percent increase for salaried direct care dollars, salaried support dollars and associated fringe will be added to the appropriate operating components in the provider’s specialty hospital rate.
(iii) The rate add-on, as calculated in (ii) above, shall be added to total allowable costs and those allowable costs shall be divided by the total patient days in the December 31, 2014 rate.
(2) The April 1, 2015 Clinical compensation increase funding formula will be:
(i) The annual impact of a two percent increase to 2011 clinical dollars and associated fringe benefits will be calculated.
(ii) The annual impact of the two percent increase for salaried clinical dollars, and associated fringe will be added to the appropriate operating components in the provider’s specialty hospital rate.
(iii) The rate add-on, as calculated in (ii) above, shall be added to total allowable costs and those allowable costs shall be divided by the total patient days in the December 31, 2014 rate.
This notice is intended:
to serve as both a notice of emergency adoption and a notice of proposed rule making. The emergency rule will expire March 29, 2015.
Text of rule and any required statements and analyses may be obtained from:
Regulatory Affairs Unit, OPWDD, 44 Holland Ave., Albany, NY, 12229, (518) 474-1830, email: RAU.Unit@opwdd.ny.gov
Data, views or arguments may be submitted to:
Same as above.
Public comment will be received until:
Five days after the last scheduled public hearing.
Additional matter required by statute:
Pursuant to the requirements of the State Environmental Quality Review Act, OPWDD, as lead agency, has determined that the action described will have no effect on the environment, and an E.I.S. is not needed.
Regulatory Impact Statement
1. Statutory Authority:
a. OPWDD has the statutory authority to adopt rules and regulations necessary and proper to implement any matter under its jurisdiction as stated in the New York State Mental Hygiene Law Section 13.09(b).
b. OPWDD has the statutory responsibility for setting Medicaid rates and fees for other services in facilities licensed or operated by OPWDD, as stated in section 43.02 of the Mental Hygiene Law.
c. Part I of chapter 60 of the laws of 2014, which is part of the 2014 – 15 enacted budget, requires OPWDD to provide funding beginning January 1, 2015 to support a 2% increase in annual salary and salary-related fringe benefits for direct care staff, and also to provide funding beginning April 1, 2015 to support a 2% increase in annual salary and salary-related fringe benefits for direct care and clinical staff.
2. Legislative Objective: These emergency/proposed regulations further the legislative objectives embodied in sections 13.09(b) and 43.02 of the Mental Hygiene Law, and in Part I of chapter 60 of the laws of 2014. The regulations amend the methodology for determining rates and fees for ICFs/DD, residential habilitation provided in community residences and family care homes, day treatment, community habilitation, day habilitation, supported employment, prevocational, respite services and specialty hospitals.
3. Needs and Benefits: Direct support staff play an essential role in delivering services to persons with developmental disabilities in New York State. In recognition of the key role these workers play, the 2014 – 15 enacted budget included funding to support a 2% increase for direct support staff in January 1, 2015, and an additional 2% increase in April 1, 2015 for direct support staff, as well as a 2% increase for clinical staff beginning on April 1, 2015. OPWDD and the Department of Health (DOH) are revising the methodologies for the affected residential and day programs to include funding to support these increases.
4. Costs:
a. Costs to the Agency and to the State and its local governments: The proposed regulations result in additional costs of approximately $34.6 million per year. Of this amount, approximately $17.3 million will be State costs, and $17.3 will be federal costs.
The new methodologies do not apply to the state as a provider of services.
There will be no savings or costs to local governments as a result of these regulations because pursuant to Social Services Law sections 365 and 368-a, either local governments incur no costs for these services or the State reimburses local governments for their share of the cost of Medicaid funded programs and services. In addition, even if the amendments lead to an increase in Medicaid expenditures in a particular county, these amendments will not have any fiscal impact on local governments, as the contribution of local governments to Medicaid has been capped. Chapter 58 of the Laws of 2005 places a cap on the local share of Medicaid costs and local governments are already paying for Medicaid at the capped level.
b. Costs to private regulated parties: The proposed regulations will increase rates and fees for ICFs/DD, residential habilitation provided in community residences and family care homes, day treatment, community habilitation, day habilitation, supported employment, prevocational and respite services.
5. Local Government Mandates: There are no new requirements imposed by the rule on any county, city, town, village, or school, fire, or other special district.
6. Paperwork: The amendments will increase paperwork to be completed by providers. Each provider will have to submit an attestation, signed by members of the board of directors, stating how the provider will distribute the direct care and clinical compensation payments to its employees.
7. Duplication: The amendments do not duplicate any existing State or Federal requirements that are applicable to services for persons with developmental disabilities.
8. Alternatives: Since the increases in rates and fees are mandated by State law, OPWDD and DOH did not consider any alternatives.
9. Federal Standards: The amendments do not exceed any minimum standards of the federal government for the same or similar subject areas.
10. Compliance Schedule: The emergency/proposed regulations are effective January 1, 2015. OPWDD expects to permanently adopt the regulations at the end of the public comments period. OPWDD and DOH expect to increase the January 1 rates and fees as soon as possible and to increase the April 1 rates and fees on April 1, 2015.
Regulatory Flexibility Analysis
1. Effect on small business: The emergency/proposed regulations amend the methodology for determining rates and fees for ICFs/DD, residential habilitation provided in community residences and family care homes, day treatment, community habilitation, day habilitation, supported employment, prevocational, respite services and specialty hospitals. OPWDD has determined, through a review of the certified cost reports, that all specialty hospital services, and most of the other services listed above, are provided by agencies that employ more than 100 people overall. However, some smaller agencies that employ fewer than 100 employees overall would be classified as small businesses. The number of providers for each of the eligible programs are as follows:
IRAs and CRs: 398
day habilitation services: 370
ICFs/DD: 120
family care homes: 32
day treatment: 16
community habilitation: 273
supported employment: 165
prevocational services: 94
respite services: 295
OPWDD is unable to estimate the portion of these providers that may be considered to be small businesses.
The proposed regulations change the methodologies for rates and fees for the eligible programs to provide funding to support a January 1, 2015 2% salary increase and an April 1, 2015 2% increase for direct support staff, as well as an April 1, 2015 2% increase for clinical staff. The new methodologies will increase rates and fees for all providers of the eligible services.
2. Compliance requirements: The proposed regulations will require each provider to submit an attestation, signed by members of the board of directors, stating how the provider will distribute the direct care and clinical compensation payments to its employees.
3. Professional services: No additional professional services will be required as a result of these regulations and the regulations will not add to the professional service needs of local governments.
4. Compliance costs: The emergency/proposed regulations will increase paperwork to be completed by providers. Each provider will have to submit an attestation, signed by members of the board of directors, stating how the provider will distribute the direct care and clinical compensation payments to its employees.
5. Economic and technological feasibility: The emergency/proposed regulations do not impose on regulated parties the use of any new technological processes.
6. Minimizing adverse impact: Because the emergency/proposed regulations increase funding to providers, they have no adverse economic impact. Each provider will need to submit an attestation, signed by members of the board of directors, stating how the provider will distribute the direct care and clinical compensation payments to its employees. However, the attestation is required by the enacted budget and is needed to ensure that the compensation increases are used for their intended purpose.
OPWDD has also reviewed and considered the approaches for minimizing adverse economic impact as suggested in section 202-b(1) of the State Administrative Procedure Act. OPWDD determined that the revision to reimbursement proposed in this amendment is the most optimal approach to instituting the necessary change in rate methodology while minimizing any adverse impact on providers.
7. Small business participation: Participation of public and private interests in rural areas: The proposed methodologies for the direct care and clinical compensation payments were described to providers in a December 8, 2014 letter, and were discussed with representatives of providers at a meeting held on December 15, 2014. This meeting included included representatives of providers, including the New York State Association of Community and Residential Agencies (NYSACRA) (which represents some providers who have fewer than 100 employees).
OPWDD will be mailing these proposed regulations to all providers, including providers that are small businesses, and will be holding public hearings on the proposed regulations.
Rural Area Flexibility Analysis
1. Description of the types and estimation of the number of rural areas in which the rule will apply: With the exception of specialty hospital services, which are only provided in New York County, OPWDD services are provided in every county in New York State. 43 counties have a population of less than 200,000: Allegany, Cattaraugus, Cayuga, Chautauqua, Chemung, Chenango, Clinton, Columbia, Cortland, Delaware, Essex, Franklin, Fulton, Genesee, Greene, Hamilton, Herkimer, Jefferson, Lewis, Livingston, Madison, Montgomery, Ontario, Orleans, Oswego, Otsego, Putnam, Rensselaer, St. Lawrence, Schenectady, Schoharie, Schuyler, Seneca, Steuben, Sullivan, Tioga, Tompkins, Ulster, Warren, Washington, Wayne, Wyoming and Yates. Additionally, certain townships in 10 other counties have a population density of 150 persons or less per square mile: Albany, Broome, Dutchess, Erie, Monroe, Niagara, Oneida, Onondaga, Orange, and Saratoga.
The proposed regulations change the methodologies for rates and fees for the affected programs to provide funding to support January 1 and April 1, 2015 2% salary increases for direct support staff, as well as an April 1, 2015 2% increase for clinical staff. The new methodologies will increase rates and fees for all providers of the eligible services.
2. Compliance requirements: The emergency/proposed regulations will require each provider to submit an attestation, signed by members of the board of directors, stating how the provider will distribute the direct care and clinical compensation payments to its employees.
The amendments will have no effect on local governments.
3. Professional services: No additional professional services will be required as a result of these regulations and the regulations will not add to the professional service needs of local governments.
4. Compliance costs: The proposed regulations will require each provider to submit an attestation, signed by members of the board of directors, stating how the provider will distribute the direct care and clinical compensation payments to its employees.
5. Minimizing adverse impact: Because the emergency/proposed regulations increase funding to providers, they have no adverse economic impact. Each provider will need to submit an attestation, signed by members of the board of directors, stating how the provider will distribute the direct care and clinical compensation payments to its employees. However, the attestation is required by the enacted budget.
OPWDD has also reviewed and considered the approaches for minimizing adverse economic impact as suggested in section 202-bb(2)(b) of the State Administrative Procedure Act. OPWDD determined that the revision to reimbursement proposed in this amendment is the most optimal approach to instituting the necessary change in rate methodology while minimizing any adverse impact on providers.
6. Participation of public and private interests in rural areas: The proposed methodologies for the direct care and clinical compensation payments were described to providers in a December 8, 2014 letter, and were discussed with representatives of providers at a meeting held on December 15, 2014. This meeting included providers in rural areas, such as NYSARC, the NYS Association of Community and Residential Agencies, NYS Catholic Conference, and CP Association of NYS.
OPWDD will be mailing these proposed regulations to all providers, including providers from rural areas, and will be holding public hearings on the proposed regulations.
Job Impact Statement
A job impact statement is not being submitted for these proposed amendments because OPWDD determined that they will not cause a loss of more than 100 full time annual jobs State wide. The proposed regulations change the methodologies for rates and fees for the affected programs to provide funding to support a January 1, 2015 2% salary increase and an April 1, 2015 2% increase for direct support staff, as well as an April 1, 2015 2% increase for clinical staff for the affected residential and day programs, to include funding to support these increases. The new methodologies will increase rates and fees for all providers of the affected services, and all providers must spend the increase on compensation for direct care and clinical staff. Therefore, OPWDD expects that there will be no overall effect on jobs and employment opportunities as a result of these amendments.
