HLT-25-13-00001-E Capital Projects for Federally Qualified Health Centers (FQHCs)

6/19/13 N.Y. St. Reg. HLT-25-13-00001-E

NEW YORK STATE REGISTER

VOLUME XXXV, ISSUE 25

June 19, 2013

RULE MAKING ACTIVITIES

DEPARTMENT OF HEALTH

EMERGENCY RULE MAKING

 

I.D No. HLT-25-13-00001-E

Filing No. 592

Filing Date. May. 30, 2013

Effective Date. May. 30, 2013

Capital Projects for Federally Qualified Health Centers (FQHCs)

PURSUANT TO THE PROVISIONS OF THE State Administrative Procedure Act, NOTICE is hereby given of the following action:

Action taken:

Amendment of section 86-4.16 of Title 10 NYCRR.

Statutory authority:

Public Health Law, section 2807-z(9)

Finding of necessity for emergency rule:

Preservation of public health.

Specific reasons underlying the finding of necessity:

The proposed amendment establishes a payment methodology to reimburse Federally Qualified Health Centers for the costs of capital projects with a total budget of less than $3 million exempt from Certificate of Need (CON) requirements.

Public Health Law section 2807-z(9) provides the Commissioner of Health with authority to issue emergency regulations in order to implement the provisions of PHL Section 2807-z. Emergency adoption of the proposed regulation is necessary to provide timely revision to rate-setting regulations to comply with the requirements of PHL Section 2807-z. This amendment is anticipated to be effective in early 2013.

Subject:

Capital Projects for Federally Qualified Health Centers (FQHCs).

Purpose:

Capital Projects with a total budget of less than $3 million shall be exempt from Certificate of Need (CON) requirements.

Text of emergency rule:

Subdivision (d) of section 86-4.16 of 10 NYCRR is amended to read as follows:

(d) Documented increases in overall operating costs of a facility resulting from capital renovation, expansion, replacement or the inclusion of new programs, staff or services approved by the commissioner through the certificate of need (CON) process may be the basis for an application for revision of a certified rate, provided, however, that such CON approval shall not be required with regard to such applications for rate revisions which are submitted by federally qualified health centers or rural health centers which are exempt from such CON approval pursuant to section 2807-z of the Public Health Law. To receive consideration for reimbursement of such costs in the current rate year, a facility shall submit, at the time of appeal or as requested by the commissioner, detailed staffing documentation, proposed budgets and financial data, anticipated utilization expressed in terms of threshold visits and/or procedures and, where relevant, the final certified costs of construction approved by the department. An appeal may be submitted pursuant to this paragraph at any time throughout the rate period. Any modified rate certified or approved pursuant to this paragraph shall be effective on the date the new service or program is implemented or, in the case of capital renovation, expansion or replacement, on the date the project is completed and in use.

This notice is intended

to serve only as a notice of emergency adoption. This agency intends to adopt this emergency rule as a permanent rule and will publish a notice of proposed rule making in the State Register at some future date. The emergency rule will expire August 27, 2013.

Text of rule and any required statements and analyses may be obtained from:

Katherine Ceroalo, DOH, Bureau of House Counsel, Reg. Affairs Unit, Room 2438, ESP Tower Building, Albany, NY 12237, [phone], email: [e-mail]

Regulatory Impact Statement

Statutory Authority:

The statutory authority for this regulation is contained in Section 2807-z(9) of the Public Health Law (PHL) which authorizes the Commissioner to promulgate regulations, including emergency regulations, with regard to Medicaid reimbursement rates for Diagnostic and Treatment services. Such rate regulations are set forth in Subpart 86-4 of Title 10 (Health) of the Official Compilation of Codes, Rules, and Regulations of the State of New York (NYCRR).

Legislative Objectives:

Subpart 86-4 of Title 10 (Health) NYCRR will be amended by amending section 86-4.16(d) to establish a discrete Federally Qualified Health Center (FQHC) rate and payment methodology to reimburse for the costs of eligible capital projects which are below the $3 million threshold. Per this regulation capital projects under $3 million in budget shall not be subject to the Certificate of Need (CON) process or requirements.

Needs and Benefits:

The proposed regulation implements the provisions of PHL Section 2807-z, which exempts certain types of diagnostic and treatment centers from CON review for capital projects under $3 million. As specified in PHL § 2807-z(6) and (7), the exempted facilities are those which receive federal grant funding reflecting their designation by the federal government as FQHCs or as rural health centers.

COSTS:

Costs to Private Regulated Parties:

There will be no additional costs to private regulated parties.

Costs to State Government:

The enacted state budget for State Fiscal Year (SFY) 2012-13 does not include any state share annually to cover the anticipated 12-month total incremental cost to the Medicaid program for providing reimbursement for eligible capital projects. As the FQHC payment rate will not be effective until 2013, less spending will occur in the current SFY due to the delay in implementation.

Costs of Local Government:

Local districts’ share of Medicaid costs is statutorily capped; therefore, there will be no additional costs to local governments as a result of this proposed regulation.

Costs to the Department of Health:

There will be no additional administrative costs to the Department of Health as a result of this proposed regulation.

Local Government Mandates:

The proposed regulation does not impose any new programs, services, duties or responsibilities upon any county, city, town, village, school district, fire district or other special district.

Paperwork:

No additional paperwork is required to be filed by FQHCs.

Duplication:

This regulation does not duplicate any existing federal, state or local government regulation.

Alternatives:

No significant alternatives are available. The revised regulation is required to comply with the provisions of PHL Section 2807-z.

Federal Standards:

The proposed regulation does not exceed any minimum standards of the federal government for the same or similar subject areas.

Compliance Schedule:

The proposed regulation establishes a new FQHC prospective payment system rate. There is no period of time necessary for regulated parties to achieve compliance with the regulation.

Regulatory Flexibility Analysis

Effect on Small Business and Local Governments:

No health care provider subject to the provisions of this regulation will see a decrease in funding as a result of this regulation. The regulation implements the opportunity for additional reimbursement to all designated Federally Qualified Health Centers (FQHCs). This rule will have no direct effect on Small Business and Local Governments.

Compliance Requirements:

No new reporting, recordkeeping or other compliance requirements are being imposed as a result of the proposed regulation.

Professional Services:

No new or additional professional services are required in order to comply with the proposed regulation.

Compliance Costs:

No additional compliance costs are anticipated as a result of this rule.

Economic and Technological Feasibility:

Small businesses will be able to comply with the economic and technological aspects of this rule because there are no technological requirements other than the use of existing technology. The overall economic impact of complying with the requirements of this regulation is expected to be positive as it provides reimbursement to FQHCs to help cover the costs associated with eligible capital projects under $3 million.

Minimizing Adverse Impact:

This regulation will not have any adverse impact on the providers as this is intended to ensure reasonable capital cost reimbursement to all FQHCs in a timely manner.

Small Business and Local Government Participation:

This regulation provides the opportunity for additional reimbursement to FQHCs statewide and thus there is a positive impact for small businesses. The local districts’ share of Medicaid costs is statutorily capped; therefore, there will be no adverse impact to local governments as a result of this regulation.

Rural Area Flexibility Analysis

Effect on Rural Areas:

The proposed regulation applies to all Federally Qualified Health Centers (FQHCs) throughout the state, including those located in rural areas. Rural areas are defined as counties with a population less than 200,000 and counties with a population of 200,000 or greater that have towns with population densities of 150 persons or fewer per square mile. The following 43 counties have a population of less than 200,000 based upon the United States Census estimated county populations for 2010 (http://quickfacts.census.gov).

Allegany	Greene	Schoharie
Cattaraugus	Hamilton	Schuyler
Cayuga	Herkimer	Seneca
Chautauqua	Jefferson	St. Lawrence
Chemung	Lewis	Steuben
Chenango	Livingston	Sullivan
Clinton	Madison	Tioga
Columbia	Montgomery	Tompkins
Cortland	Ontario	Ulster
Delaware	Orleans	Warren
Essex	Oswego	Washington
Franklin	Otsego	Wayne
Fulton	Putnam	Wyoming
Genesee	Rensselaer	Yates
	Schenectady

The following counties have a population of 200,000 or greater and towns with population densities of 150 persons or fewer per square mile based upon the 2010 census.

Albany	Monroe	Orange
Broome	Niagara	Saratoga
Dutchess	Oneida	Suffolk
Erie	Onondaga

Compliance Requirements:

No new reporting, recordkeeping, or other compliance requirements are being imposed as a result of the proposed regulation.

Professional Services:

No new additional professional services are required in order for providers in rural areas to comply with the proposed regulation.

Compliance Costs:

No additional compliance costs are anticipated as a result of this rule.

Minimizing Adverse Impact:

The regulation provides the opportunity for additional reimbursement to Federally Qualified Health Centers and Rural Health Centers statewide for their eligible capital projects.

Rural Area Participation:

In addition to FQHCs, rural health centers are also able to share the benefit of this new regulation.

Job Impact Statement

A Job Impact Statement is not required pursuant to Section 201-a(2)(a) of the State Administrative Procedure Act. It is apparent from the nature and purpose of the proposed rule that it will not have a substantial adverse impact on jobs or employment opportunities. The proposed regulation establishes a Federally Qualified Health Center (FQHC) rate-setting methodology to reimburse Diagnostic and Treatment Centers for the capital costs of less than $3 million which are not subject to the regulation regarding certificate of need process or requirements. The proposed regulation has no adverse implications for job opportunities. Rather, the additional revenue generated by FQHCs as a result of the new payment rate may provide them with the financial resources they need to add staff, thus enhancing their ability to provide expanded services.