Medicaid Appeal Rights and CILA Provider Initiated Discharge

Medicaid Appeal Rights and CILA Provider Initiated Discharge Human Services Research Institute December 30, 2012 Issue The Institute for Public Policy requested analysis of the current practice in Illinois that requires issuance of Medicaid appeal rights when a Community Integrated Living Arrangement (CILA) provider discharges a waiver participant from services. There is no question that individuals served under the Medicaid program should have a right to due process and the ability to appeal adverse decisions. The specific issue raised here is whether or not discharge by a provider agency qualifies as a Medicaid appealable action, ultimately equal to decisions about eligibility, service authorization and termination made by either the Department of Human Services, Division of Developmental Disabilities (DHS/DDD) as the Operating Agency, or Healthcare and Family Services (HFS) as the State Medicaid Agency. This information brief (a) describes the methodology used to consider the question, (b) provides analysis of the issue, and (c) offers recommendations on discharge procedures that may be helpful for Illinois. Methodology Analysis of the issue of whether or not discharge by a CILA provider is a Medicaid appealable action began by researching Illinois waiver documents, Medicaid appeal processes, CILA regulations in IAG Title 59, Parts 115 and 120, and the Service Termination Approval Request (STAR) form. 42 CFR Part 431, Subpart E was also reviewed. For comparison purposes, waiver applications and regulations from other states including Oregon, Indiana, Maine and Connecticut were considered. Other state s regulations were also examined but information on provider discharge and Medicaid appeals were difficult to find specific to Home and Community Based Services (HCBS). The analysis also included a review of state procedures that might be incorporated into CILA regulations in Illinois to protect individuals from unwarranted discharge and protect both individuals and providers from being trapped indefinitely in a difficult situation. Analysis CILA services are covered in the Illinois Waiver for Adults with Developmental Disabilities. A number of federal and state regulations, policies and procedures provide the structural framework and programmatic requirements for this program. The review below includes information gathered from both federal and state sources including those listed in the Methodology section above. HCBS 1915 (c) Waiver Requirements As a 1915(c) waiver, the state is required to provide Medicaid appeal rights as described in federal code and as described in Section F: Participant Rights of the Home and Community-Based Services (HCBS) waiver application: The State provides an opportunity to request a Fair Hearing under 42 CFR Part 431, Subpart E to individuals: Human Services Research Institute 1 7690 SW Mohawk Street / Tualatin OR 97062 503-924-3783 -- www.hsri.org

(a) who are not given the choice of home and community-based services as an alternative to the institutional care specified in Item 1-F of the request; (b) are denied the service(s) of their choice or the provider(s) of their choice; or, (c) whose services are denied, suspended, reduced or terminated. The recently approved Illinois Adult waiver includes the following response in Section F-1: Opportunity to Request a Fair Hearing that describes when appeal rights are issued: Independent Service Coordination (ISC) entities under contract with the OA [Operating Agency] are responsible for written notification when there is: Determination of ineligibility for Waiver services. Denial of choice of Waiver or institutional services. Denial of choice of Waiver services or providers. The waiver case manager/service Facilitator is responsible for providing written notification to the participant when there is a denial, reduction, suspension or termination of service by the provider. It appears that the interpretation of the opportunity for a fair hearing used by HFS and DHS/DDD is that a decision by a CILA provider to discharge an individual is included under the federal requirements for denial, suspension, reduction or termination of services. The language on the requirement in the HCBS waiver application does not specify action taken by the provider, as it does in the response provided by the state. Code of Federal Regulations (CFR) The Medicaid waiver requires that the state provide the right to a Fair Hearing as described in 42 CFR Part 431, Subpart E, 431.200 (b). This section of the federal code includes a statement that the subpart, Prescribes procedures for an opportunity for a hearing if the State agency or PAHP [Prepaid Ambulatory Health Plan] takes action, as stated in this subpart, to suspend, terminate, or reduce services, or an MCO [Managed Care Organization] or PIHP [Prepaid Inpatient Health Plan] takes action under subpart F of part 438 of this chapter. This is important to note because a decision by a CILA provider to discharge or terminate services to an individual is neither an action by the State agency, nor an action by a PAHP, an MCO nor a PIHP. 1 As an example, the MaineCare Benefits Manual for individuals receiving services on the state s HCBS waiver for Intellectual Disability and Autistic Disorder specifically states that, members have the right to appeal in writing or orally any decision made by DHHS (Department of Health and Human Services) to reduce, deny or terminate services provided under this benefit. 2 When services are terminated on the Illinois DD waiver, a Service Termination Approval Request (STAR) form must be signed and submitted to DHS/DDD by the provider and the Pre-Admission Screening/Individual Services and Support Advocate (PAS/ISSA). This form requires approval by DHS/DDD. However, submission of the form does not occur until the individual has either waived or fully exhausted appeal rights. 1 As Illinois moves into Managed Long Term Support and Services (MLTSS) for CILA services, adverse decisions made by the managed care entities will be subject to applicable federal appeal regulations. 2 Underline added for emphasis. Human Services Research Institute 2

Title 59, Part 115: Standards and Licensure Requirements for Community Integrated Living Arrangements (CILA) Rule 115 provides the backbone of the regulatory framework for the CILA program in Illinois. In considering the issue of CILA discharge and appeal rights, it is important to review this specific rule. Rule 115 does not clearly define termination, nor does it include a term for discharge or another term to describe a decision, unilateral or otherwise, by a provider to cease CILA services to a waiver participant. As currently written, termination in the rule can be read to mean both (a) a provider decision to no longer serve an individual and (b) a decision by the state to stop CILA services for a waiver recipient. These are two separate and distinct issues. A waiver participant has the right to access CILA services, regardless of the provider, once he or she is determined to be eligible for the waiver and is approved for the level of support required in a CILA setting. This means that any decision by a provider to end CILA services does not impact the individual s ability to access that specific service from another provider, nor does it mean the person no longer qualifies for the Medicaid waiver. In that regard, termination by a provider does not constitute a denial, reduction, suspension or termination of services. As a waiver participant, the individual is free to choose another provider and continue to receive the service. Section 115.215 documents Criteria for termination of individuals from CILA services: a) The community support team shall consider recommending termination of services to an individual only if: 1) The medical needs of the individual cannot be met by the CILA program; or 2) The behavior of an individual places the individual or others in serious danger; or 3) The individual is to be transferred to a program offered by another agency and the transfer has been agreed upon by the individual, the individual's guardian, the transferring agency and the receiving agency; or 4) The individual no longer benefits from CILA services. b) Termination of services shall occur only if the termination recommendation has been approved by the Department. For individuals enrolled in the Department's Medicaid DD Waiver, termination of services is subject to review according to 59 Ill. Adm. Code 120. Sections a) 1), 2) and 4) above note that the community support team can recommend termination of services only if the medical needs or behavioral needs of the individual cannot be met in the CILA program, or if the individual will no longer benefit from CILA services. Termination can only occur if it is approved by the Department, at which point the decision to terminate services is subject to review (appeal) as noted 59 Adm, Code 120. In general, these criteria and issuance of appeal rights are appropriate if termination is defined as ending the individuals ability to access CILA services on the waiver, regardless of the provider. Subpart 115.215 a) 3) of this rule introduces the idea that termination criteria are also met if a person is transferring to a program offered by another agency, and the transfer is agreed to by the individual, guardian and the support team. This is not specifically a termination of CILA services. It is a transfer, or a discharge of the individual by one provider and initiation of CILA services by another provider. The individual has not lost the right to CILA services. This section of the rule indicates that the transfer is Human Services Research Institute 3

done with agreement by the individual (i.e. not an independent provider action) however, the point is the same regardless of who initiates the discharge and ultimate transfer. Discharge from a CILA provider does not prevent the individual from accessing CILA services from any other CILA provider. Nor is it terminating the individuals right to access CILA services on the Medicaid waiver. Specific recommendations on ensuring the individual s needs are appropriately met during a transition from one CILA provider to another are included in the Recommendations section below. Section 115.520 of the CILA rule outlines Individual rights and confidentiality requirements of the CILA program. Subpart a) 3) states that individuals have the right to remain in a CILA unless the individuals voluntarily withdraw or meet criteria set forth in Section 115.215. This section of the Rule is also unclear. It may be interpreted to mean that the person has the right to stay in a specific CILA home, or it may mean that the person has the right to stay in a CILA, i.e. in the CILA program in general. In either case, DHS/DDD may want to review and clarify this section of the rule. Conclusion The analysis provided in this information brief leads to the conclusion that a decision by a CILA provider to end CILA services to an individual does not rise to the level of a decision made by either DHS/DDD or HFS as described in 42 CFR Part 431, Subpart E and is therefore, not subject to the Medicaid appeal process. A decision by a provider to discharge an individual without his or her agreement should be made only under the most serious circumstances. The current requirement to provide Medicaid appeal rights if discharge is initiated by the provider serves as some level of protection from unwarranted discharge that falls short of critical issues that risk the health and safety of the individual, other people living in the home, or direct support staff. The section that follows provides recommendations on policies that DHS/DDD can consider to ensure individuals are protected, but also ensures providers are not required to continue services to someone when all other options have been exhausted and the provider recognizes it is in their best interest to discharge the individual. Recommendation In its review of other states policies and procedures, HSRI was unable to identify another state that issues Medicaid appeal rights to waiver participants when a provider indicates they are no longer going to provide a specific service to an individual. Information on Medicaid appeal rights and processes were identified, as were provider discharge processes, but there was nothing in the materials reviewed that connected the two or indicated that provider initiated discharge was a Medicaid appealable action. Based on review of the various discharge regulations, the following key components are used in other states to ensure the individual s needs are appropriately addressed during transition from one provider to another and may be appropriate for future CILA regulations: Individual Support Team Review and Technical Assistance Prior to a decision being made by the provider to stop serving an individual, the Interdisciplinary Support Team (IST) should be required to meet to review the circumstances and make recommendations on possible options for maintaining the placement. A subsequent meeting within Human Services Research Institute 4

a specific timeframe should be established to review progress. Both Oregon and Connecticut require an IST meeting prior to a formal decision to discharge an individual. If at the next meeting, it is clear the recommendations have been followed, but have not improved the situation, the appropriate Operating Agency (DHS/DDD) representative should be notified. The purpose of that notification is to inform the state of the situation and ensure all possible options, including funding for exceptional needs and/or technical assistance, have been exhausted. Discharge Notice Once the prior steps have been taken, and the IST generally agrees that the situation has not or cannot be resolved, the provider may issue a notice of the intent to end services to the individual. The termination notice should be required to be given at least 60 days prior to the planned date of termination. Connecticut requires Operational Agency approval before the provider can issue the termination notice, other states do not. In Oregon, the decision to terminate services must be supported by a majority of IST members. If the individual or guardian does not agree with the decision, there is a grievance process that is available through the local county developmental disability program. Decisions made by that entity may go through a grievance process at the Operating Agency level. Continuation of Services and Transition Planning A regulation that requires the discharging provider to continue services uninterrupted until the individual has transitioned to another CILA provider, even if that occurs after the planned termination date, is important. This ensures the individual s service needs will be met until a new provider is identified and transition occurs. This is expected when providers discharge an individual in Indiana. To ensure a successful transition, the discharging CILA provider may also be required to participate in a transition planning process with the IST and the newly selected CILA provider. The decision to discharge an individual is often difficult and should not be taken lightly. As Illinois continues efforts to transition individuals from institutional settings to the community service system, successful providers will be those that can most appropriately meet the needs of people with intellectual and developmental disabilities, regardless of their individual issues or challenges. However, there are times when the individual and the provider relationship is not a good match. With appropriate protections in place to ensure individuals needs are met during the discharge and transition process, the state should reconsider including CILA provider discharge as a Medicaid appealable action. Human Services Research Institute 5