OFFICE OF MENTAL RETARDATION AND DEVELOPMENTAL DISABILITIES
PROPOSED RULE MAKING
HEARING(S) SCHEDULED
I.D No. MRD-48-08-00021-P
Liability for Services
PURSUANT TO THE PROVISIONS OF THE State Administrative Procedure Act, NOTICE is hereby given of the following proposed rule:
Proposed Action:
Addition of Subpart 635-12 to Title 14 NYCRR.
Statutory authority:
Mental Hygiene Law, sections 13.07, 13.09(b), 41.25, 43.02 and 43.03
Subject:
Liability for Services.
Purpose:
To set forth requirements related to liability for services.
Public hearing(s) will be held at:
10:30 a.m., Jan. 12, 2009 at Bernard Fineson DC - Bldg. 1, 80-45 Winchester Blvd., Queens Village, New York, NY; 3:00 p.m., Jan. 14, 2009 at OMRDD - 44 Holland Ave., Counsel's Office Conference Rm., 3rd Fl., 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.
Substance of proposed rule (Full text is posted at the following State website: www.omr.state.ny.us):
• Adds a new Subpart 635-12 to 14 NYCRR, Liability for Services.
• Generally establishes that either an individual takes necessary steps to obtain and maintain Full Medicaid Coverage or the individual and/or liable parties pay for services.
• Requires individuals to take necessary steps to apply for HCBS waiver services, if they are requesting or receiving those services.
• Applies to the following services operated by voluntary providers: ICF/DDs, Medicaid Service Coordination, Day Treatment Services, and the following HCBS Waiver Services: Residential Habilitation Services (community (in a community residence), IRA, family care, and at home), Day Habilitation Services, Prevocational Services, Supported Employment Services, Respite Services, and Blended and Comprehensive Services which are a combination of the other Services.
• Requires all voluntary providers to establish fee schedules for the services listed above. The fees are required to be the same as the Medicaid fee, rate, or price established by OMRDD for the service.
• Defines "liable party" as someone who is liable to pay for services delivered to an individual pursuant to Section 43.03 of the Mental Hygiene Law or other law.
• Defines "Full Medicaid Coverage" as the type of coverage under the Medicaid program that pays for the services requested or received.
• Establishes that individuals and liable parties must provide personal and financial information upon the request of the provider. In some situations the provider is required to request this information.
• Establishes that individuals and liable parties must notify the provider if the individual loses Medicaid and if circumstances change that would affect the individual's eligibility for Medicaid or the individual's and/or liable persons' ability to pay for services.
• Establishes that individuals must either:
(1) obtain and maintain Full Medicaid Coverage (with provider assistance if necessary),
(2) agree to pay the full fee for the service (liable parties may agree in lieu of the individual),
(3) agree to pay the fee as reduced by the provider and acknowledge certain conditions related to the reduction of the fee (Other liable parties may agree and acknowledge in lieu of the individual); or
(4) acknowledge that the fee has been waived and certain conditions related to the waiver. (Other liable parties may acknowledge in lieu of the individual.)
• Requires the provider to give individuals and liable parties a schedule of fees and a notice that includes a description of the obligations of the provider, the individual and liable parties under the law and this regulation.
• Establishes a procedure for providers to reduce or waive fees with the approval of OMRDD.
• Defines "Preexisting Services" as those services that an individual was receiving on a regular basis as of February 15, 2009 and sets forth specific criteria for additional situations in which services are considered "Preexisting Services."
• Establishes a timetable for notifying individuals receiving Preexisting Services and liable persons that they have specified obligations and that they will be billed if the individual does not have Full Medicaid Coverage and the fees are not waived.
• Establishes that the provider will bill for Preexisting Services delivered on or after April 15, 2009 if the individual does not have Full Medicaid Coverage and the fees are not waived. Bills for services other than Preexisting Services are required to cover all dates that services are provided.
• Establishes standards for billing, collection and assignment of unpaid bills to OMRDD.
• Collection efforts cannot interfere with the individual's services.
• Establishes standards for the payment of state funds when the individual does not have Full Medicaid Coverage and the full fee is not paid by the individual or someone else. State funds will only be paid if the provider adheres to all relevant requirements.
• Establishes that state funds may pay for services other than Preexisting Services in situations when:
(1) delaying the start of services may endanger the individual's health or safety,
(2) the provider is legally prohibited from denying or discontinuing services,
(3) the person lost Full Medicaid Coverage or private payments have stopped, and ending the services would endanger the person's health or safety,
(4) OMRDD has approved a waiver or reduction in fees, or
(5) MSC is needed for the individual to obtain Full Medicaid Coverage.
• Establishes that state funds may pay for Preexisting Services in situations when:
(1) OMRDD was paying for the services or the individual had Full Medicaid Coverage immediately prior to February 15, 2009, or
(2) OMRDD has approved a waiver or reduction in fees.
• A provider may not discharge an individual from Preexisting Services or otherwise discontinue Preexisting Services to an individual because of failure to pay.
• A provider may deny the request for Services:
(1) if the individual does not have Full Medicaid Coverage; and
(2) if the provider has not received reasonable assurance that the individual or other liable party will pay for the Services; and
(3) if the fees have not been waived.
A provider may not deny Services to an individual if the provision of Services is otherwise required by law or court order.
• Except for Preexisting Services, a provider may discharge an individual or otherwise discontinue services because of failure to pay. Providers must adhere to the processes in 14NYCRR Section 633.12. Providers cannot discharge or discontinue services if the continuation of services is otherwise required by law or court order.
Text of proposed rule and any required statements and analyses may be obtained from:
Barbara Brundage, Director, Regulatory Affairs Unit, OMRDD, 44 Holland Avenue, Albany, New York 12229, (518) 474-1830, email: barbara.brundage@omr.state.ny.us
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 SEQRA and 14 NYCRR Part 602, OMRDD has on file a Negative Declaration with respect to this Action. OMRDD has determined that the action described herein will have no effect on the environment, and an E.I.S. is not needed.
Regulatory Impact Statement
1. Statutory authority:
a. The New York State Office of Mental Retardation and Developmental Disabilities' (OMRDD) statutory responsibility to assure and encourage the development of programs and services in the area of care, treatment, rehabilitation, education and training of persons with mental retardation and developmental disabilities, as stated in the New York State Mental Hygiene Law Section 13.07.
b. OMRDD's 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).
c. Section 41.25 of the Mental Hygiene Law requires that fees charged or payments requested take into account costs and ability to pay, considering resources available from private and public health insurance and medical aid programs.
d. OMRDD's responsibility, as stated in section 43.02 of the Mental Hygiene Law, for setting Medicaid rates and fees for services in facilities licensed or operated by OMRDD.
e. Section 43.03 of the Mental Hygiene Law establishes liability for fees for services. The individual, his/her estate, spouse, parents or guardian if the individual is under 21, and representative payee or fiduciary holding assets for the individual are jointly and severally liable for the fees. Parents or spouses of parents are not liable for fees for services rendered to a disabled child under 21 if the child does not reside in the common household.
2. Legislative objectives: These proposed amendments further the legislative objectives embodied in sections 13.07, 13.09, 41.25, 43.02 and 43.03 of the Mental Hygiene Law by promoting personal responsibility to contribute to the cost of care and equity in the application of liability to individuals and other liable parties for developmental disabilities services provided by not-for-profit agencies operating under the auspices of OMRDD. The proposed amendments will establish a process that will require individuals with developmental disabilities to take all necessary steps to obtain and maintain Medicaid coverage or for the individual and/or liable persons to pay for the services. In a restrictive fiscal environment, individuals (and liable persons) with the ability to pay should contribute to the cost of their services, and individuals eligible for Medicaid should obtain Medicaid coverage. This, in turn, allows OMRDD to serve more individuals with limited resources.
3. Needs and benefits: The overwhelming majority (98 percent) of persons served by the OMRDD service delivery system qualify for funding of their services by Medicaid. Medicaid pays for most developmental disabilities services. While Medicaid is a major component of the State's budget for developmental disabilities services, there remain isolated instances of individuals who are or could be eligible for Medicaid but who have not applied for Medicaid. In most of these instances, OMRDD pays the provider for these services with State funds, raising questions of equity and resulting in expenditures that OMRDD would otherwise be capable of redirecting to provide services to other people.
The proposed regulations require that the provider of services establish a basic fee schedule which is the Medicaid rate, fee or price established by OMRDD for the applicable program or service. If the individual does not take all necessary steps to obtain and maintain Medicaid coverage, the provider will be required to bill the individual and other liable persons according to that fee schedule and make reasonable efforts to collect unpaid bills. After making reasonable collection efforts, the provider will assign to OMRDD the claim for any unpaid amount. It is expected that this process will lead to more persons receiving developmental disabilities services applying for Medicaid, thereby increasing OMRDD's ability to serve more people. Individuals may also apply to the provider for a reduction or waiver of the fee, which can be granted with OMRDD approval in certain circumstances.
4. Costs:
a. Costs to the Agency and to the State and its local governments: OMRDD will not incur any new costs as a result of these amendments. OMRDD estimates that implementation of the regulations will create an estimated savings to the State of approximately $ 17.5 million as services currently funded with 100 percent State monies become funded with 50 percent participation of federal funds and some individuals or liable parties pay the fees established. There will be no additional costs to local governments as a result of these specific amendments because Chapter 58 of the Laws of 2005 places a cap on the local share of Medicaid costs.
b. Costs to private regulated parties: There are no initial capital investment costs nor initial non-capital expenses. There are some additional costs to individuals and providers associated with implementation and continued compliance with the amendments. Providers will incur costs in gathering financial and personal information, helping persons apply for Medicaid and in issuing notices and fee schedules. However, OMRDD's Revenue Support Field Offices will assist in gathering information, and OMRDD will issue model notices for providers to use. Also, because the provider community already assists individuals in applying for Medicaid benefits, OMRDD anticipates that most providers will not incur significant costs assisting individuals in obtaining and maintaining Medicaid benefits. Furthermore, OMRDD has, in cooperation with the Provider Associations, formed a Benefit Development Workgroup to help the providers develop their own expertise in maximizing benefits for the people they serve. This initiative has produced a Benefit Development Resource Guide which serves as a reference tool on how to file for and maintain Medicaid.
Providers will also incur costs in billing and collection efforts, but after reasonable collection efforts, the provider will assign the claim to OMRDD. After the assignment, the cost of all further collection efforts, including costs for attorneys, will be borne by the State.
c. Costs to individuals and families: Although the regulations require that an individual take all necessary steps to obtain and maintain Medicaid coverage or privately pay as a prerequisite for receiving services from an OMRDD authorized service provider, individuals will not have services they are already receiving stopped because providers must continue to render services while collection efforts are undertaken. Individuals requesting new services will have the option to obtain and maintain Medicaid coverage or privately pay. Individuals may also apply to the provider for a reduction or waiver of the fee, which can be granted with OMRDD approval in certain circumstances.
Individuals will be expected to cooperate with the provider and take all necessary steps to obtain and maintain Medicaid coverage or pay for the services themselves. OMRDD will continue its support to assist individuals in filing for Medicaid through a combination of funding service coordination and by the technical assistance of OMRDD's Revenue and Support Field Offices (RSFOs). This will mitigate any negative impact on individuals.
In some instances individuals may need legal advice in establishing Medicaid exception trusts. However, since a Medicaid exception trust is only necessary if a person has substantial assets, persons needing such a trust to qualify for Medicaid have assets to pay the legal fees for establishing the trust. Also, a Medicaid exception trust is extremely beneficial for a person in that it gives the person Medicaid funding for services, and still lets him or her have the use of the assets for his or her lifetime.
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: For individuals and their parents, the requirement to file for Medicaid will involve completion of the necessary application paperwork (by themselves or the provider) and cooperation or participation in any appeals processes. The maintenance of the Medicaid benefit involves taking the necessary steps (filing recertification applications, meeting monthly spend downs) to maintain the individual's continued eligibility.
As already stated, over 98 percent of the persons served under the auspices of OMRDD have already been taking all steps involved with Medicaid application and maintenance of eligibility. And, as stated under Costs section of this Regulatory Impact Statement, current service recipients and individuals requesting services can all rely on the assistance and expertise of OMRDD's Revenue Support Field Offices and service coordinators to help them file the proper paperwork to receive and maintain eligibility for Medicaid.
Under the proposed regulations, providers will be required to give notices and a fee schedule to all individuals currently receiving services who do not have Medicaid coverage. If individuals and liable persons decline to cooperate with the provider in obtaining and maintaining Medicaid coverage for the individual, the providers will bill them for the services and make reasonable efforts to collect on the bills. After reasonable collection efforts have been made providers will be required to send paperwork associated with assigning the unpaid debt to OMRDD. OMRDD will draft notices for providers to use and will draft the legal papers assigning the debt to OMRDD. Providers will not have to write these documents themselves.
7. Duplication: The proposed amendments do not duplicate any existing State or Federal requirements that are applicable to the above cited services for persons with developmental disabilities.
8. Alternatives: There is no viable alternative to issuance of a regulation that requires individuals to file for benefits or pay for services. OMRDD has been working with its service providers to maximize participation in Medicaid. However, a small number of representatives and attorneys for individuals have said that they will not act until the State mandates full cooperation. These regulations will ensure that all individuals in the OMRDD service delivery system are served and treated in an identical fashion, and that Medicaid is claimed to support the cost of such services when individuals are eligible. Providers of services have, themselves, suggested that establishing the Medicaid participation requirement in regulation would help them to enforce OMRDD policy.
9. Federal standards: The proposed regulations do not exceed any applicable federal standards.
10. Compliance schedule: As previously stated, the overwhelming majority of persons served by the OMRDD service delivery system are already in compliance with the requirements set forth in the regulations.
For persons requesting new services the regulations will reinforce current OMRDD policy which requires that the individual cooperate with the service provider in taking all necessary steps to obtain and maintain Medicaid coverage or private pay. Within one month after the regulation is in effect, providers will have to give persons already receiving services notices about their and the providers' rights and obligations under the regulations. Beginning with services delivered two months after the effective date of the regulation, providers will be required to issue bills to these persons if they do not have Medicaid coverage.
When it is necessary for the provider to issue a bill, it must present the bill no later than thirty days after the month in which the services were rendered.
Regulatory Flexibility Analysis
1. Effect on small businesses and local governments: These proposed regulatory amendments will apply to agencies which provide developmental disabilities services under the auspices of OMRDD. While most services are provided by voluntary agencies which employ more than 100 people overall, many of the facilities and services operated by these agencies at discrete sites (e.g. small residences) employ fewer than 100 employees at each site, and each site (if viewed independently) would therefore be classified as a small business. Some smaller agencies which employ fewer than 100 employees overall would themselves be classified as small businesses. As of September 2008, OMRDD estimates that there are approximately 715 provider agencies that would be affected by the proposed amendments.
The proposed amendments have been reviewed by OMRDD in light of their impact on these small businesses and on local governments. OMRDD has determined that these amendments will not have any negative effects on these small business providers of developmental disabilities services.
The proposed amendments will establish a process that will require individuals with developmental disabilities to take all necessary steps to obtain and maintain Full Medicaid Coverage or, for the individual and/or liable parties to pay for the services. In a restrictive fiscal environment, individuals and liable parties with the ability to pay should contribute to the cost of their services. This, in turn, allows OMRDD to serve more individuals with limited resources.
The overwhelming majority (98 percent) of individuals served by the OMRDD service delivery system qualify for funding of their services by Medicaid. Medicaid pays for most developmental disabilities services. While Medicaid is a major component of the State's budget for developmental disabilities services, there remain isolated instances of individuals who are or could be eligible for Medicaid but who have not applied for Medicaid. In most of these instances, OMRDD pays the provider for these services with State funds, raising questions of equity and resulting in expenditures that OMRDD would otherwise be capable of redirecting to provide services to other people.
The proposed regulations require that the provider of services establish a basic fee schedule which is the Medicaid rate, fee or price established by OMRDD for the applicable program or service. If the individual does not take all necessary steps to obtain and maintain Medicaid coverage, the provider will be required to bill the individual and other liable persons according to that fee schedule and make reasonable efforts to collect unpaid bills. After making reasonable collection efforts, the provider will assign to OMRDD the claim for any unpaid amount. It is expected that this process will lead to more persons receiving developmental disabilities services applying for Medicaid, thereby increasing OMRDD's ability to serve more people. Individuals may also apply to the provider for a reduction or waiver of the fee, which can be granted with OMRDD approval in certain circumstances.
There will be no additional costs to local governments as a result of these specific amendments because Chapter 58 of the Laws of 2005 places a cap on the local share of Medicaid costs.
2. Compliance requirements: As discussed in the Regulatory Impact Statement, providers will have to meet requirements in gathering financial and personal information, helping persons apply for Medicaid and in issuing notices and fee schedules. However, OMRDD's Revenue Support Field Offices will assist in gathering information, and OMRDD will issue notices for providers to use. Also, because the provider community already assists individuals in applying for Medicaid benefits, OMRDD anticipates that most providers will not incur significant costs assisting individuals in obtaining and maintaining Medicaid benefits. Furthermore, OMRDD has, in cooperation with the Provider Associations, formed a Benefit Development Workgroup to help the providers develop their own expertise in maximizing benefits for the people they serve. This initiative has produced a Benefit Development Resource Guide which serves as a reference tool on how to file for and maintain Medicaid.
Providers will also incur costs in billing and collection efforts, but after reasonable collection efforts, the provider will assign the claim to OMRDD. After the assignment, the cost of all further collection efforts, including costs for attorneys, will be borne by the State.
Individuals will be expected to cooperate with the provider of services and take all necessary steps to obtain and maintain full Medicaid coverage or pay for the services themselves. OMRDD will continue its support to assist individuals and their representatives in filing for Medicaid through a combination of service coordination and by the technical assistance of OMRDD's Revenue Support Field Offices (RSFOs). This will mitigate any negative impact on individuals, families and their representatives.
OMRDD has carefully considered the desirability of a small business regulation guide to assist provider agencies with these regulations, as provided for by section 102-a of the State Administrative Procedure Act. As noted above, OMRDD has already produced a Benefit Development Resource Guide that has been issued as a CD to providers and service coordinators. This guide serves as a reference tool on how to file for and maintain most major benefits.
3. Professional services: There are no additional professional services required as a result of these amendments and the amendments will not add to the professional service needs of local governments. For individuals and their parents who are a seeking to be served by the OMRDD system, or for individuals who are already being served but have not obtained or maintained full Medicaid coverage, it may occasionally be necessary to seek legal advice associated with establishing a Medicaid exception trust. For providers of services, the notices and billing requirements will entail a slight increase in administrative effort, but this will be more than offset by the additional revenues available to the service delivery system.
4. Compliance costs: As stated, for small business providers of services, there are some additional costs to individuals and providers associated with implementation of, and continued compliance with, these proposed amendments. Providers will incur costs in gathering financial and personal information, helping persons apply for Medicaid and in issuing notices and fee schedules. However, OMRDD's Revenue Support Field Offices will assist in gathering information, and OMRDD will issue notices for providers to use. Also, because the provider community already assists individuals in applying for Medicaid benefits, OMRDD anticipates that most providers will not incur significant costs assisting individuals in obtaining and maintaining Medicaid benefits. Furthermore, OMRDD has, in cooperation with the Provider Associations, formed a Benefit Development Workgroup to help the providers develop their own expertise in maximizing benefits for the people they serve. This initiative has produced a Benefit Development Resource Guide which serves as a reference tool on how to file for and maintain Medicaid.
Providers will also incur costs in billing and collection efforts, but after reasonable collection efforts, the provider will assign the claim to OMRDD. After the assignment, the cost of all further collection efforts, including costs for attorneys, will be borne by the State.
Although the regulations require that an individual take all necessary steps to obtain and maintain Medicaid coverage or privately pay as a prerequisite for receiving services from an OMRDD authorized service provider, individuals will not have services they are already receiving stopped because providers must continue to render services while collection efforts are undertaken. Individuals requesting new services will have the option to obtain and maintain Medicaid coverage or privately pay. Individuals may also apply to the provider for a reduction or waiver of the fee, which can be granted with OMRDD approval in certain circumstances.
Individuals will be expected to cooperate with the provider and take all necessary steps to obtain and maintain Medicaid coverage or pay for the services themselves. OMRDD will continue its support to assist individuals in filing for Medicaid through a combination of funding service coordination and by the technical assistance of OMRDD's Revenue and Support Field Offices (RSFOs). This will mitigate any negative impact on individuals.
In some instances individuals may need legal advice in establishing Medicaid exception trusts. However, since a Medicaid exception trust is only necessary if a person has substantial assets, persons needing such a trust to qualify for Medicaid have assets to pay the legal fees for establishing the trust. Also, a Medicaid exception trust is extremely beneficial for a person in that it gives the person Medicaid funding for services, and still lets him or her have the use of the assets for his or her lifetime.
5. Economic and technological feasibility: The proposed amendments are concerned with fiscal and administrative issues, and do not impose on regulated parties the use of any new technological processes.
6. Minimizing adverse economic impact: The amendments will not result in any significant adverse economic impacts.
7. Small business and local government participation: The proposed rule making is in response to the recognition that providers of services need, in regulation, a requirement and process that will assist them in securing the cooperation of service recipients in obtaining and maintaining Medicaid or service recipients and liable parties in paying for the services. The proposed regulations have been developed in consultation with small business providers of services. Most recently, the draft regulations were shared with representatives of provider associations, and were discussed at a meeting of provider associations on Sept. 24, 2008. The regulations were also shared with the Self Advocacy Association of New York State (an organization of people who receive services), Parent to Parent (a parent organization) and the Commissioner's Advisory Council which includes representation by service providers, parents, service recipients and their advocates. The proposed regulations were also shared with the Willowbrook Consumer Advisory Board, New York Civil Liberties Union and New York Lawyers for the Public Interest.
Rural Area Flexibility Analysis
A Rural Area Flexibility Analysis for this rule making is not submitted because the amendments will not impose any adverse impact or significant reporting, record keeping or other compliance requirements on public or private entities in rural areas. As discussed in the Regulatory Flexibility Analysis for Small Businesses and Local Governments, providers of services may find there is some administrative effort associated with the notice and billing requirements of the proposed regulations, however, these relatively minor effects will not disproportionately impact providers as a result of the region of New York State in which they provide services or the location (rural, urban or suburban) of their operations.
Job Impact Statement
A Job Impact Statement for this rule making is not being submitted because it is apparent from the nature and purposes of the amendments that they will not have a substantial impact on jobs and/or employment opportunities. The proposed new Subpart will regulate a process that will require individuals with developmental disabilities and persons representing them to take all necessary steps to obtain and maintain Medicaid coverage or, for the individual and/or liable persons, to pay for the services. The proposed regulations will not change the nature or volume of services provided under the auspices of OMRDD to persons with developmental disabilities, so that it is reasonable to expect that they will have no impact on jobs and/or employment opportunities in New York State.
