August 31, 2012
SCHOOL-BASED MEDICAID
COST SETTLEMENT SYSTEM
www.cms.gov
Medicaid Program - Jointly Funded - Federal/State
72.62%
27.38%
72.62%
Changes annually per state’s capita income.
27.38%
1990
Each School District – 1st #
2000
Each School District – 2nd #
Scheduled Rates
Cost-Based Rate Salaries/Benefits
Audiology - $36 per service
Initial/Triennial IEP - $500 per IEP
Physical /Occupational Therapy
- $10 per 15 minutes
Annual IEP $100 per IEP
Speech Therapy - $7 per 15
minutes Individual session
Personal Care (part) - $45 per day
Nurse - $7 per 15 minutes
Individual session - specialized
procedure
Psychology - $100 per
evaluation
Personal Care (full) - $90 per day
Sp. Trans. Vehicle - $20 per day
(round trip)
Sp. Trans. Aide - $18 per day
(round trip)
Care Coordination - $78 per
month
Serves as the
Clearinghouse
LEA
Provide the service:
Speech, PT, OT, etc.
Progress Notes
Attendance Records
Billing
Form or
WVEIS
Entry
Electronic
claim
RESA
Fed
Payment
– Direct
Deposit
72.62%
Remittance Advice
Denial/pending
WVDHHR Molina
Processing
Agency;
Bureau of
Medical
Services
BMS
Historical Approach to School Based Medicaid Programs to 2003
•
•
Fee for Service
(FFS)
72.62%
Medicaid
Administrative
Claiming
(MAC)
50%
LEA $
RESA $
“Compartmentalized” programs with minimal integration
Various compliance issues in both programs

One reason the Federal government proposed to eliminate MAC
WV: Introduction to Medicaid
Cost Based School Based
Health Services
6
Districts provided
50% (except for
RESA 2)
LEA
Supporting Documentation:
IEP
Progress Notes
Attendance Records
Care Coordination form
Billing
Form or
WVEIS
Entry
Fed -Medical
Administrative
Claiming (MAC)
50%
Electronic
claim
RESA
Fed
Payment –
Direct
Deposit
72.62%
Remittance Advice
Denial/pending
WVDHHR Molina
Processing
Agency;
Bureau of
Medical
Services
BMS
1990
Direct Services
Each School District – 1st #
Scheduled Rate
Audiology $36 per service
Physical /Occupational Therapy
$10 per 15 minutes
Speech Therapy $7 per 15
minutes Individual session
Nurse $7 per 15 minutes
Individual session
Psychology $100 per
evaluation
2003
Each School District – 2nd #
Cost-Based Rate added Indirect
costs
Initial/Triennial IEP $700 per IEP
Annual IEP $170 per IEP
Personal Care (full) $190 per day
Personal Care (part) $95 per day
Sp. Trans. Vehicle $26 per day
(round trip)
Sp. Trans. Aide $22 per day
(round trip)
Care Coordination $98 per month
Districts provided
100% (except for
RESA 2)
LEA
Supporting Documentation:
IEP
Progress Notes
Attendance Records
Care Coordination form
Billing
Form or
WVEIS
Entry
Fed -Medical
Administrative
Claiming (MAC)
50%
Electronic
claim
RESA
Fed
Payment –
Direct
Deposit
72.62%
Remittance Advice
Denial/pending
WVDHHR Molina
Processing
Agency;
Bureau of
Medical
Services
BMS
Medicaid Reimbursement for FY 00 through FY 10
Series1
$48,341,185.25
$42,233,949.75
$39,366,911.72
$38,516,237.61
$38,312,540.83
$30,803,857.04
$21,596,755.78
$16,672,684.10
$14,649,453.07
$12,063,984.40
$2,164,052.58
1
2
3
4
5
6
7
8
9
10
11
Overview of Program Changes
•In response to CMS questions, West Virginia is implementing a new
reimbursement methodology for school based services, effective July 1,
2012.
•Effective for dates of service beginning July 1, 2012, school based providers
will be reimbursed using a cost based reimbursement methodology.
•School based providers will be required to participate in a Random Moment
Time Study and complete an annual cost report as part of the new
methodology.
•School Based providers will still need to submit Fee-for-service claims
for services rendered throughout the year.
•In addition to the changes in the direct services, West Virginia will also be
implementing a Medicaid Administrative Claiming (MAC) program to capture
administrative costs for activities performed in support of the Medicaid
program.
2012 Approach to School-Based Medicaid Programs
 Programs now work together
MAC
50%
match
WV: Introduction to Medicaid
Cost Based School Based
Health Services

Integrated time study for Medicaid
Administrative Claiming (MAC) and Fee
For Service reimbursement

District administrative personnel costs
will be included in the cost report and
will take part in the time-study to
determine what part of their costs is
eligible for MAC

The direct service costs (therapists,
special education teachers, personal
care aides) will be included in the cost
report and will take part in the time
study to determine what part of their
costs is eligible for reimbursement AND
determine what responses qualify for
MAC.
12
Overview of FFS Cost Reporting Process

The purpose of the Medicaid Fee-For-Service (FFS) Program is to provide
reimbursement for medically necessary services that are received in schools and
provided or arranged by a school system for Medicaid-eligible students with an
Individualized Education Program (IEP)

Services are currently reimbursed according to a mix of cost based and fee
schedule

Effective for dates of services beginning July 1, 2012, services will be cost
reimbursed and an annual Medicaid cost report must be filed by each LEA
 Medicaid cost will be calculated through a series of calculations including a
Cost Report, a Random Moment Time Study (RMTS) methodology, Cost
Reconciliation and Cost Settlement
 Medicaid cost will be compared to Medicaid interim payments for direct
services and a settlement will be calculated for each LEA
 When LEA Medicaid costs exceed Medicaid interim payments, a
settlement will be due to the LEA
 When LEA Medicaid costs are less than Medicaid interim payments, the
LEA will return the overpayment to Medicaid
WV: Introduction to Medicaid
Cost Based School Based
Health Services
13
West Virginia Job Categories – Direct Service
Fee for Service (72.62% Fed match)
 Job categories and job titles include – 3 different cost “pools”:
1 . WV Licensed Audiologist
WV Licensed Physical Therapist
WV Licensed Registered Nurse
2.
Personal Care Aide – Personal Care 1:1
WV: Introduction to Medicaid
Cost Based School Based
Health Services
WV Licensed Occupational Therapist
Speech Language Therapist
WV Licensed Psychologist
3.
Special Education Teacher - Care
Coordination
14
Cost Settlement Calculation Example –
1.0
Total Costs of Eligible Direct Services Provider Costs (county’s
cost)
2.0
Indirect Cost Rate
3.0
Total Costs of Eligible SBHS Provider Costs
4.0
RMTS Direct Medical Percentage Results (Statewide results)
5.0
Direct Medical Services Costs
$747,500
6.0
Costs of Contracted Vendors
$100,000
7.0
Total Costs of SBHS Provider Costs
$847,500
8.0
Application of Medicaid Eligibility Rate (IEP Ratio) (county’s)
9.0
Medicaid Direct Medical Services Costs (for the county)
$423,750
10.0
Medicaid Payments Received (by the county)
$473,750
WV:
Introduction
to Medicaid
11.0
Medicaid
Cost
Cost Based School Based
Health Services
$1,000,000
115.00%
Settlement (at the end of the year – July 2013)
15
$1,150,000
65.00%
50.00%
$0
Medicaid Administrative Claiming
(MAC) in WV
 MAC offers reimbursement for the costs of administrative
activities, such as outreach, that support the Medicaid program.
 Allowable activities are:
 Medicaid outreach and related training
 Facilitating Medicaid eligibility application
 Health-related referral activities & monitoring of health service
delivery
 Medical service program planning, policy development, and
interagency coordination
 Arranging for Medicaid-related transportation and provision of
Medicaid-related translation
WV: Introduction to Medicaid
Cost Based School Based
Health Services
16
School Based Examples of Activities
 Providing information to individuals and families regarding the
West Virginia Medicaid program and available services
 Scheduling and/or coordinating EPSDT screens or other medical
and mental health diagnostic services
 Gathering any information that may be required in advance of
these referrals
 Developing internal plans and strategies to improve health service
delivery and eliminate gaps
 Attending a parent meeting for a child with issues that may need
outside health or counseling services
WV: Introduction to Medicaid
Cost Based School Based
Health Services
17
West Virginia Job Categories – Administrative Costs
(50% Federal match) Not cost settled
 Job categories and job titles include –
1 . Administrator
Special Education Director
Special Education Secretary
RESA Medicaid Specialist
WV: Introduction to Medicaid
Cost Based School Based
Health Services
Principal
Assistant Principal
Program Specialist
18
Non Allowable Staff
• Staff included in the calculation of the Unrestricted Indirect
Cost Rate cannot be included on your staff pool list
– These include costs reported in the following function
codes:
• Business Support Services
• Plant Operations and Maintenance
– The costs in these function codes are not allowable
because the Unrestricted Indirect Cost Rate is used in the
calculation of the claim
– Staff who are paid entirely from these function codes
should be removed from the staff pool list
– Partially paid staff from allowable object codes can be
included
WV: Introduction to Medicaid
Cost Based School Based
Health Services
19
Administrative Claiming - not billing for direct services
1.0
Total Costs of Administrative Costs (county’s cost)
$1,000,000
2.0
RMTS Direct Medical Percentage Results (Statewide results)
3.0
Direct Medical Services Costs
4.0
Costs of Contracted Vendors (RESAs) not subject to RMTS
5.0
Total Costs of Administrative Costs
6.0
Application of Medicaid Eligibility Rate (IEP Ratio) (county’s)
50.00%
7.0
Medicaid Direct Medical Services Costs (for the county)
$55,000
10.00%
$100,000
$10,000
$110,000
Because RESAs will be treated like other vendor for cost
reporting purposes, the RESAs will now need to bill counties
just like any other vendor effective July 1, 2012: Hours
Worked X Billable Rate.
In the past, RESAs may have simply billed a county for a
certain percentage of an employee’s salary and fringe
benefits, based on a pre-determined agreement with the
county. Such an agreement does not take into consideration
the fact that the employee does not spend all of their time
providing services for the county 9ex. General time spent in
the office, continuing education, etc.).
The RESAs will now need to develop appropriate billable
rates to charge to the counties based on the actual hours
spent providing Medicaid reimbursable services.
In terms of determining rates for Medicaid billing services,
keeping hourly documentation of time spent for each district
and billing accordingly would be the preferred method of
calculating the rates.
However, we would be happy to discuss the reimbursement
method based on the amount of reimbursement received –
with a bit more clarity surrounding the process they would be
using, we would be better equipped to provide advice. Please
let me know if you would like to arrange for a time next week
to discuss this further.
Preliminary Results of 1st RMTS
February - March
Response rates – 85% required (3000 moments
per “pool”)
»
»
»
»
92.13% - Direct Services
83.20% - Care Coordination
78.60% - Personal Care
89.47% - Admin
Preliminary Results of 1st RMTS
February - March
Service percentages responses
»
»
»
49.16% - Direct Services
4.24% (4.15%) - Care Coordination
20.21% (18.48%) - Personal Care
PCG’s Time Study Team – “less than
appropriate responses were submitted.”
A number of inappropriate responses were
received by staff participating in the RMTS.
Two areas of concern:
• Incomplete responses
• Rudeness/Frustration
Inappropriate Responses to RMTS
Example 1: (Would not be coded as Medicaid
allowable cost. Needs more detail.)
1. Who was with you?
• No one
2. What were you doing?
• Duty
3. Why were you doing this activity?
• Assigned duty
4. Is this activity regarding a Special Education student?
• No
Inappropriate Responses to RMTS
Example 2:
1. Who was with you?
• A group of people charged with carrying out the work
of an establishment
2. What were you doing?
• Inputting the last “moment in time” documentation
instead of using my scheduled paperwork time to prepare
for the two IEPs that I have next week.
3. Why were you doing this activity?
• You keep sending me these “moments.” I am itinerant
and MCS will not provide me with a computer, IPad, or
other internet access to use during treatment blocks of
time. Scheduled office time is the only time I can
complete these “moments.”
4. Is this activity regarding a Special Education student?
• NA
Inappropriate Responses to RMTS
Issues that arise from inappropriate responses:
 Creates additional administrative burden.
 Moment can be incorrectly coded if information is omitted
or misleading.
• When clarification is not received, moment is likely to
be coded as non-reimbursable.
 Reduction in reimbursement
• Medicaid reimbursement is tied to the RMTS results
• Penalty if 85% response rate isn’t achieved
Cost Settlement Calculation Example –
1.0
Total Costs of Eligible Costs Direct Services (county’s cost)
2.0
Indirect Cost Rate
3.0
Total Costs of Eligible SBHS Provider Costs
4.0
RMTS Direct Medical Percentage Results (Statewide results)
5.0
Direct Medical Services Costs
$565,340
6.0
Costs of Contracted Vendors
$100,000
7.0
Total Costs of SBHS Provider Costs
$665,340
8.0
Application of Medicaid Eligibility Rate (IEP Ratio) (county’s)
9.0
Medicaid Direct Medical Services Costs (for the county)
$332,670
10.0
Medicaid Interim Payments Received (by the county)
$400,000
11.0
Medicaid
Cost
WV:
Introduction
to Medicaid
Cost Based School Based
Health Services
$1,000,000
115.00%
Settlement (at the end of the year – July 2013)
29
$1,150,000
49.16%
50.00%
$67330
Cost Settlement Calculation Example –
1.0
Total Costs of Eligible Costs Care Coordination (county’s cost)
2.0
Indirect Cost Rate
3.0
Total Costs of Eligible SBHS Provider Costs
4.0
RMTS Direct Medical Percentage Results (Statewide results)
5.0
Direct Medical Services Costs
6.0
Costs of Contracted Vendors
7.0
Total Costs of SBHS Provider Costs
$47,725
8.0
Application of Medicaid Eligibility Rate (IEP Ratio) (county’s)
50.00%
9.0
Medicaid Direct Medical Services Costs (for the county)
$23,862.50
10.0
Medicaid Interim Payments Received (by the county)
$24,000.00
11.0
Medicaid
Cost
WV:
Introduction
to Medicaid
Cost Based School Based
Health Services
$1,000,000
115.00%
$1,150,000
4.15%
$47,725
$0
Settlement (at the end of the year – July 2013)
30
$317.50
Cost Settlement Calculation Example –
1.0
Total Costs of Eligible Costs Personal Care Aide (county’s cost)
2.0
Indirect Cost Rate
3.0
Total Costs of Eligible SBHS Provider Costs
4.0
RMTS Direct Medical Percentage Results (Statewide results)
5.0
Direct Medical Services Costs
6.0
Costs of Contracted Vendors
7.0
Total Costs of SBHS Provider Costs
8.0
Application of Medicaid Eligibility Rate (IEP Ratio) (county’s)
9.0
Medicaid Direct Medical Services Costs (for the county)
$106,260
10.0
Medicaid Interim Payments Received (by the county)
$300,000
11.0
Medicaid
Cost
WV:
Introduction
to Medicaid
Cost Based School Based
Health Services
$1,000,000
115.00%
$1,150,000
18.48%
$212,520
$2,000
$214,520
Settlement (at the end of the year – July 2013)
31
50.00%
$193740
Quarterly Staff Pool List Updates
 Staff can only be added once a quarter, no one can be
added for the quarter after the staff pool list has been
submitted (Vendors not included in time study)
 Once RMTS is implemented, the staff pool list from the
previous quarter should be updated every quarter
 LEAs can add, remove, or change participants’ information at
this time
 If questions arise about the update, PCG will contact the
LEA to get clarification
 After all staff pool lists have been returned and quality
checks completed, PCG will generate state-wide
Random Moment Time Study (RMTS) sample
WV: Introduction to Medicaid
Cost Based School Based
Health Services
32
Current Quarter Process
• Pull your staff pool list - be sure to list the Job Title,
First and Last Names, Email Address and School
Name (optional)
• Provide PCG with the LEA staff pool list the first time
– Following the first upload, you will be trained by PCG to
use the online Staff Pool List web-based system
WV: Introduction to Medicaid
Cost Based School Based
Health Services
33
Quarterly Cost Reports - County Treasurers
Costs of Direct Services – Audiological, Speech,
Occupational, Physical, Psychological, Nurses (RNs)
Services
Costs of Care Coordination – Special Education
Teachers (of students with disabilities)
Cost of Personal Care – 1:1 Aides
Cost of Administrative Personnel
Cost of Specialized Transportation – Not subject to
RMTS
Quarterly Payroll Information
First
Name
Cost Pool Job Title
Employee
ID
Total
Salary
Total
Benefits
Compens
ation
Federal
Sources
(IDEA)
Net
Compens
ation
Expendit
ures
John
Direct
Service
Speech
Language
Pathologist
92001111
$25,000
$3,900
$10,000
$18,900
John
Care
Coordina
tion
Special
Education
Teacher
92001112
$39,000
$2,300
John
Personal
Care
Aide
92001113
$12,500
$2,859
$42,300
$15,359
$0
District’s Specialized Transportation
Cost Report
Draft form – will be completed electronically.
District’s Cost Report
Draft form – will be completed electronically.
District’s Quarterly Cost Report
Codes – Accuracy Important
Project Codes: 43310 – IDEA School-age Funding
43320 – IDEA Preschool Funding
Program Function Codes: 21210 Multi-categorical
2
(Other codes)
2
22161 Occupational Therapy
22162 Physical Therapy
etc.
Object Codes: 111 Regular professional (salary)
121 Regular service (salary)
2XX Benefits
RMTS Rosters
Rosters of staff in an Excel Template (PCG) - in
August 2012
RMTS – October – December 2012
RMTS – January – March 2012
RMTS – April – June 2012