South Carolina Primary Health Care Association. December 17, 2011

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1 South Carolina Primary Health Care Association December 17, 2011 Michael Holton Holton Healthcare Consulting, Inc

2 Omnibus Budget Reconciliation Act (OBRA) of 1990 amended 1861(aa)(2) of the Social Security Act to establish FQHCs as entities to provide a new Medicare benefit effective October 1, Regulations were published June 12, 1992 and are under 42 CFR Part

3 Is receiving a grant under 330 of the Public Health Service Act; or Is receiving funding under a contract with a recipient of a 330 grant and meets the requirements to receive a grant under 330 of the PHS Act; or Is an FQHC Look-Alike.meets the requirements for receiving a 330 grant even though it is not receiving the grant; or Was treated by CMS as a comprehensive federally funded health center as of January 1, 1990, or Is an outpatient health program or facility operated by a tribe or tribal organization under the Indian Self-Determination Act or by an Urban Indian organization receiving funds under Title V of the Indian Health Care Improvement Act. 2

4 CMS will enter into an agreement with an entity to participate as an FQHC when: CMS receives a complete application Form CMS 855A, Medicare Enrollment Application, Institutional Providers; CMS receives a copy of the applicant s Notice of Grant Award issued by HRSA, the FQHC Look-Alike Designation Memo from CMS, or the applicant is confirmed as a qualifying tribal or Urban Indian organization outpatient healthcare facility. The applicant assures CMS that it satisfies the regulatory requirements of 42 CFR 405 Subpart X, and 42 CFR Part 491, except for 491.3, and The applicant terminates other Medicare provider agreements it has, unless it assures CMS that it is not using the same space, staff and resources simultaneously as an FQHC and physician s office or other type provider or supplier. 3

5 To participate in the Medicare program as an FQHC, applicants must submit to CMS: A signed and completed application Form CMS-855A. May be downloaded from CMS Web site at: Includes instructions about where to submit the application. Two copies of the standard attestation statement, each with an original signature and date. Serves as the Medicare FQHC agreement when completed by CMS. HRSA Notice of Grant Award or FQHC Look-Alike designation approval. Copy of the HRSA form that lists the service sites approved. Clinical Laboratory Improvement Act (CLIA) certificate. State Licenses Copy of the National Provider Identifier (NPI) notification the applicant received from the National Plan and Provider Enumeration System. 4

6 Form requires completing information on health center s identification (locations, address, etc.), legal history (including adverse rulings), ownership interest (sheet per board member with SSN), practice locations, etc. Copies of all: Professional/business licenses CLIA licenses Pharmacy licenses Legal Action documents EDI Agreements Articles of Incorporation/Corporate charters IRS Documents Notice of Grant Award

7 6

Social Security Act 1861(aa)(4) Statutory Requirements 1833(a)(3) = Payment provisions 1832(a)(2)(D) =Managed Care provisions 1861(v)(1)(A) = FQHC Services & IOM 100-02,Chap 13 Regulation 405.

8 Social Security Act 1861(aa)(4) Statutory Requirements 1833(a)(3) = Payment provisions 1832(a)(2)(D) =Managed Care provisions 1861(v)(1)(A) = FQHC Services & IOM ,Chap 13 Regulation (RHC/FQHC) General Methodology The reasonable cost of any services shall be the cost actually incurred, excluding any cost found to be unnecessary in the efficient delivery of needed health services

9 All-Inclusive Rate Methodology: POSSIBLE CEILINGS POSSIBLE CAPS ALLOWABLE COSTS BILLABLE VISITS = ALL-INCLUSIVE RATE POSSIBLE PRODUCTIVITY SCREENS

10 Total Allowable Costs $ 10,000,000 All Billable Visits ( ) 100,000 All-Inclusive Rate = $100/visit

11 The cost report settlement process involves Acceptance of the cost report by intermediary Interim (tentative) settlement of reimbursement Intermediary desk review or field audit Preliminary proposed adjustment report & related communications Final settlement through issuance of a Notice of Program Reimbursement (NPR)

12 If a balance is due from the Medicare program, partial payment generally received upon tentative settlement Small percentage usually held Remaining amount released upon final settlement of cost report, if due No consistent time frame Prospective Rate for Next Year

13 A nationwide health insurance program for people 65 years of age and older, some disabled people under 65 years of age, and people with End- Stage Renal Disease (permanent kidney failure treated with dialysis or a transplant). Medicare Eligibility and Enrollment FQHC Medicare guarantees retroactive reasonable cost-based reimbursement, up to the Upper Payment Limit (UPL - $ urban/ $ rural 1/1/12 12/31/12) A health center must bill the patient for 20% of the Medicare allowable charges. The health center may discount the 20% if the patient is eligible for the health center s sliding fee discount. The discount may not be less than the health center s nominal fee.

14 FQHC Medicare Payment Provisions Pay FQHCs/RHCs 80% of All-Inclusive Rate No Medicare Annual Deductible for visits to FQHCs 100% Reimbursement for Pneumococal and Influenza Vaccines and Administration Cost Report Calculation Medicare Bad Debt Recovery Sliding Fee Scale Applicability 62 ½ % Reimbursement for treatment of mental, psychoneurotic, and personality disorders Medicare Part B for non-covered services

15 Medicare FQHC Services, as defined in Regulation are: Physician Services and services/supplies incident to Nurse Practitioner and Physician Assistant services and services/supplies incident to Clinical Psychologist and clinical social worker services and services/supplies incident to Visiting nurse services Nurse-midwife services Diabetes Self-Management Training (DSMT) Medical Nutrition Therapy (MNT) Preventive primary services

16 Effective January 1, 2006 Section 5114 of Deficit Reduction Act of 2005, FQHC definition of face-to-face encounter is expanded to include encounters with qualified practitioners of Outpatient DSMT services and Medical Nutrition Therapy Program requirements for provision of such services set forth in Part 410, subpart H (DSMT) and Part 410, subpart G (MNT) IOM , Chapter 15, Sec 300 = Accreditation from American Diabetes Assn. or Indian Health Service IOM , Chapter 18, Sec 120 = Billing requirements

17 Services required under Section 330 of PHS Act Furnished by providers listed in previous slide Medical social services Nutritional assessment and referral Preventive health education Children s eye and ear examinations Prenatal and post-partum care Perinatal Services Well Child care Immunizations Family planning services Taking patient history Blood pressure measurement Weight Physical Exam ETC

18 Outpatient Mental Health Treatment Limitation (Rev. 1843, Issued: , Effective: , Implementation: ) The limitation has been 62.5 percent since the inception of the Medicare Part B program and it will remain effective at this percentage amount until January 1, However, effective January 1, 2010, through January 1, 2014, the limitation will be phased out as follows: January 1, 2010 December 31, 2011, the limitation percentage is 68.75% January 1, 2012 December 31, 2012, the limitation percentage is 75% January 1, 2013 December 31, 2013, the limitation percentage is 81.25% January 1, 2014 onward, the limitation percentage is 100%

19 The Affordable Care Act includes a subsection providing the statutory framework for development and implementation of a Prospective Payment System (PPS) for Medicare FQHCs in Grants the DHHS Secretary authority to collect data necessary to develop and implement the PPS. Beginning with dates of services on or after January 1, 2011, FQHCs must report all services provided during the encounter/visit by listing the appropriate HCPCS code. 18

20 Medicare will make one payment at the all-inclusive rate for each date of service that contains a valid HCPCS code for professional services when one of the following revenue codes is present: Code Definition 0521 Clinic visit by member to FQHC 0522 Home visit by FQHC practitioner 0524 Visit by FQHC practitioner to member in a covered Part A stay at a SNF Visit in SNF (not Part A covered), NF or ICF MR or other residential facility 0527 FQHC Visiting Nurse Service Home Health Shortage Area 0528 Visit by FQHC practitioner to other non FQHC site 19

21 Medicare will make an additional encounter payment at the all-inclusive rate on the same claim when: Two service lines are submitted with a 052X revenue code and one line contains modifier 59. Services subject to the Medicare outpatient mental health limitation are billed under revenue code 0900; Diabetes Self Management Training (DSMT) is billed under revenue code 052X and HCPCS code G0108, and Medical Nutrition Therapy (MNT) is billed under revenue code 052X and HCPCS code 97802, 97803, or G0270; The Initial Preventive Physical Examination (IPPE) billed under revenue code 052X and HCPCS code G0402. This is a once in a lifetime benefit and HCPCS coding is required. NOTE: Modifier 59 is NOT REQUIRED for DSMT, MNT or IPPE in order to receive an additional encounter payment. 20

22 Example of FQHC Medicare claim when billing for multiple visits that are eligible for payment for multiple services: Line Rev Code HCPCS Code Modifier Date of Service Charges Office Visit 9/1/ Remove Wax from Ear 9/1/ Office Visit 59 9/1/ Wound Cleaning 9/1/ Bone Setting w/casting 9/1/ DSMT 9/1/11 G

The Medicare Prescription Drug, Improvement, and Modernization Act of 2003 renamed the Medicare+Choice plan and made other changes including regional PPOs, special needs plans for dual eligibles, and

23 The Medicare Prescription Drug, Improvement, and Modernization Act of 2003 renamed the Medicare+Choice plan and made other changes including regional PPOs, special needs plans for dual eligibles, and others, and created private drug plans effective 1/1/06. Rates paid to managed care companies were also increased in many cases. Overall HHS target is to increase Medicare enrollees in managed care to 30% by 2013 from 12% in ,575,173 are enrolled as of November, 2011, which is approximately 26% (48,821,279). Also includes supplemental wrap-around payments to FQHCs who contract with Medicare Advantage (MA) plans. Includes HMOs, PPOs, and PFFS. All are known as MA Plans. Created also were Special Needs Plans (SNP) which restricts enrollment only to dual-eligibles, those residing in institutional settings, or those with multiple chronic conditions.

24 Health centers with MA plan contracts will be paid based on the contract. In addition, will qualify for a supplemental wrap-around payment when it provides FQHC Services. With PFFS plans, health center is entitled to 80% of its reasonable costs (up to the cap), plus 20% of its actual charges, less the plan s co-pay.

Three contractual requirements between Plans & CMS: Must be written contract between FQHC and MA Plan MA plan must pay FQHCs an amount similar to what it pays other non-fqhc providers FQHC must

25 Three contractual requirements between Plans & CMS: Must be written contract between FQHC and MA Plan MA plan must pay FQHCs an amount similar to what it pays other non-fqhc providers FQHC must accept MA payment and wraparound as payment in full Covers FQHC services only Does not include certain Part B services such as lab and x-ray. Does not include pharmacy costs under Part D. Part B services should be billed directly to the MA plan

26 System changes made to accept payment on 6/3/06 (bill type 73x and revenue code 0519) FQHC submits an estimate of MA payments to fiscal intermediary FQHC will receive payment for each wraparound bill it submits to fiscal intermediary NACHC Issue Brief # 86 dated June, 2006

27 Proc Procedure Description Estimated Plan Weighted Code Units Rate Rate Est. Office Visit 38 $ $ Est. Office Visit , Est. Office Visit 3, ,056 Totals 5,200 $ 309,388 Per-Visit-Rate $ 59.50

28 Starting 1/1/06, prescription drug plans (PDPs) will be the primary mechanism for Medicare enrollees to receive prescription drug benefits Optional benefit; enrollees will need to sign up Dual-eligibles will receive coverage through Medicare Part D, not Medicaid Health centers with pharmacies will need to contract with PDPs to receive reimbursement for Medicare pharmacy patients No statutory provisions preventing health centers with 340B programs from participating in Part D

30 Michael Holton

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