OMH-29-09-00001-E Medical Assistance Rates of Payment for Residential Treatment Facilities for Children and Youth

7/22/09 N.Y. St. Reg. OMH-29-09-00001-E

NEW YORK STATE REGISTER

VOLUME XXXI, ISSUE 29

July 22, 2009

RULE MAKING ACTIVITIES

OFFICE OF MENTAL HEALTH

EMERGENCY RULE MAKING

 

I.D No. OMH-29-09-00001-E

Filing No. 753

Filing Date. Jul. 01, 2009

Effective Date. Jul. 01, 2009

Medical Assistance Rates of Payment for Residential Treatment Facilities for Children and Youth

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

Action taken:

Amendment of section 578.8 of Title 14 NYCRR.

Statutory authority:

Mental Hygiene Law, sections 7.09 and 43.02

Finding of necessity for emergency rule:

Preservation of general welfare.

Specific reasons underlying the finding of necessity:

The amendments ensure consistency with the enacted 2009-2010 State budget by reducing the growth rate of Medicaid reimbursement associated with residential treatment facilities for children and youth regulated by the Office of Mental Health, effective 7/1/09.

Subject:

Medical Assistance Rates of Payment for Residential Treatment Facilities for Children and Youth.

Purpose:

To reduce the growth rate of medicaid reimbursement associated with residential treatment facilities for children and youth.

Text of emergency rule:

Paragraph (4) of Section 578.8(a) is amended to read as follows:

(4) The allowable costs, as set forth in paragraph (1) of this subdivision, that meet the requirements stated in paragraphs (2) and (3) of this subdivision, shall be trended by the applicable Medicare inflation factor for hospitals and units excluded from the prospective payment system except for the rate periods effective July 1, 1996 through June 30, 1997, and July 1, 2009 through June 30, 2010, where the inflation factor used to trend costs will be limited to the inflation factor for the first year of the two-year period.

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 September 28, 2009.

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

Joyce Donohue, NYS Office of Mental Health, 44 Holland Avenue, Albany, NY 12229, [phone], email: [e-mail]

Regulatory Impact Statement

1. Statutory Authority: Section 7.09 of the Mental Hygiene Law grants the Commissioner of the Office of Mental Health the authority and responsibility to adopt regulations that are necessary and proper to implement matters under his/her jurisdiction.

Section 43.02 of the Mental Hygiene Law provides that the Commissioner has the power to establish standards and methods for determining rates of payment made by government agencies pursuant to Title 11 of Article 5 of the Social Services Law for services provided by facilities, including residential treatment facilities for children and youth licensed by the Office of Mental Health.

2. Legislative Objectives: Article 7 of the Mental Hygiene Law reflects the Commissioner’s authority to establish regulations regarding mental health programs. The amendments to Part 578 are needed to reduce the growth rate of Medicaid reimbursement associated with residential treatment facilities for children and youth regulated by the Office of Mental Health (OMH) and ensure consistency with the enacted 2009-2010 state budget.

3. Needs and Benefits: The amendments remove the 2009-2010 trend factor from the Medicaid rate calculation for residential treatment facilities (RTF) for children and youth, which are identified as a subclass of hospitals under Section 31.26 of the Mental Hygiene Law. As a result, the rate of growth in Medicaid expenditures is slowed, yet the RTF’s quality and availability of services are maintained. This is an Administrative Action consistent with the 2009-2010 enacted State Budget, and reflects the serious fiscal condition of the State. This action is consistent with actions taken in the enacted budget applicable to the Department of Health, where trend factors were eliminated from calculation of Medicaid rates for inpatient services effective April 1, 2009.

4. Costs:

(a) cost to State government: These regulatory amendments will not result in any additional costs to State government.

(b) cost to local government: These regulatory amendments will not result in any additional costs to local government.

(c) cost to regulated parties: This regulatory amendment will not result in any additional cost to regulated parties, but will reduce the rate of growth in Medicaid payments that the RTF providers receive. It is estimated that this action will result in an annual reduction in Medicaid growth of approximately $1.9 million State share of Medicaid ($3.8 million gross Medicaid).

5. Local Government Mandates: These regulatory amendments will not result in any additional imposition of duties or responsibilities upon county, city, town, village, school or fire districts.

6. Paperwork: This rule should not substantially increase the paperwork requirements of affected providers.

7. Duplication: These regulatory amendments do not duplicate existing State or federal requirements.

8. Alternatives: As noted above, this amendment is consistent with the 2009-2010 enacted State Budget and the budgetary constraints included therein. OMH has determined that the elimination of the trend factor for RTFs would not affect the ability of those programs to continue to function and serve the children and youth who are receiving services there. The only alternative to this rulemaking would have been to make budgetary cuts to another program which would not have been as sustainable as the residential treatment facilities. Therefore, that alternative was not considered.

9. Federal Standards: The regulatory amendments do not exceed any minimum standards of the federal government for the same or similar subject areas.

10. Compliance Schedule: The regulatory amendments would become effective immediately upon adoption.

Regulatory Flexibility Analysis

The rulemaking will reduce the rate of growth in Medicaid reimbursement associated with the residential treatment facilities for children and youth regulated by the Office of Mental Health. The proposed change is consistent with the 2009-10 enacted State budget and recognizes the serious fiscal condition of the State. This change removes the program’s 2009-10 trend factor from the Medicaid rate calculation and, as a result, slows the rate of growth in Medicaid expenditures, while maintaining the program’s quality and availability of services. There will be no adverse economic impact on small businesses or local governments; therefore, a regulatory flexibility analysis is not submitted with this notice.

Rural Area Flexibility Analysis

A Rural Area Flexibility Analysis is not submitted with this notice because the rulemaking, which serves to reduce the growth rate of Medicaid reimbursement associated with the residential treatment facilities for children and youth regulated by the Office of Mental Health, will not impose any adverse economic impact on rural areas. The proposed change is consistent with the 2009-10 enacted State budget and recognizes the serious fiscal condition of the State. This change removes the program’s 2009-10 trend factor from the Medicaid rate calculation, and as a result slows the rate of growth in Medicaid expenditures, while maintaining the program’s quality and availability of services.

Job Impact Statement

A Job Impact Statement is not submitted with this notice because the regulation eliminates the 2009-10 trend factor from the Medicaid rate calculation for residential treatment facilities for children and youth regulated by the Office of Mental Health. This is consistent with the 2009-10 enacted State budget. The result of this rulemaking is the rate of growth in Medicaid expenditures is slowed, but a program’s quality and availability of services is maintained. There will be no adverse impact on jobs and employment opportunities.