AB 1863: Medi-Cal: federally qualified health centers: rural health centers.
- Session Year: 2015-2016
- House: Assembly
- Latest Version Date: 2016-09-25
Existing law provides for the Medi-Cal program, which is administered by the State Department of Health Care Services, under which qualified low-income individuals receive health care services. The Medi-Cal program is, in part, governed and funded by federal Medicaid program provisions. Existing law provides that federally qualified health center (FQHC) services and rural health clinic (RHC) services, as defined, are covered benefits under the Medi-Cal program, to be reimbursed, to the extent that federal financial participation is obtained, to providers on a per-visit basis. Visit is defined as a face-to-face encounter between a patient of an FQHC or RHC and specified health care professionals. Existing law allows an FQHC or RHC to apply for an adjustment to its per-visit rate based on a change in the scope of services it provides.
This bill would include a marriage and family therapist within those health care professionals covered under that definition. The bill would require an FQHC or RHC that currently includes the cost of services of a dental hygienist in alternative practice, or a marriage and family therapist for the purposes of establishing its FQHC or RHC rate to apply to the department for an adjustment to its per-visit rate if the FQHC or RHC chooses to bill these services as a separate visit, and, after the rate adjustment has been approved by the department, would require the FQHC or RHC to bill these services as a separate visit, as specified. The bill would require an FQHC or RHC that does not provide the services of a dental hygienist, dental hygienist in alternative practice, or a marriage and family therapist, and later elects to add these services and bill these services as a separate visit, to process the addition of these services as a change in scope of service.
This bill would incorporate additional changes in Section 14132.100 of the Welfare and Institutions Code proposed by SB 1335, that would become operative only if SB 1335 and this bill are both chaptered and become effective on or before January 1, 2017, and this bill is chaptered last.
Existing law provides for the Medi-Cal program, which is administered by the State Department of Health Care Services, under which qualified low-income individuals receive health care services. The Medi-Cal program is, in part, governed and funded by federal Medicaid program provisions. Existing law provides that federally qualified health center (FQHC) services and rural health clinic (RHC) services, as defined, are covered benefits under the Medi-Cal program, to be reimbursed, to the extent that federal financial participation is obtained, to providers on a per-visit basis. Visit is defined as a face-to-face encounter between a patient of an FQHC or RHC and specified health care professionals. Existing law allows an FQHC or RHC to apply for an adjustment to its per-visit rate based on a change in the scope of services it provides.
This bill would include a marriage and family therapist within those health care professionals covered under that definition. The bill would require an FQHC or RHC that currently includes the cost of services of a dental hygienist in alternative practice, or a marriage and family therapist for the purposes of establishing its FQHC or RHC rate to apply to the department for an adjustment to its per-visit rate if the FQHC or RHC chooses to bill these services as a separate visit, and, after the rate adjustment has been approved by the department, would require the FQHC or RHC to bill these services as a separate visit, as specified. The bill would require an FQHC or RHC that does not provide the services of a dental hygienist, dental hygienist in alternative practice, or a marriage and family therapist, and later elects to add these services and bill these services as a separate visit, to process the addition of these services as a change in scope of service.
This bill would incorporate additional changes in Section 14132.100 of the Welfare and Institutions Code proposed by SB 1335, that would become operative only if SB 1335 and this bill are both chaptered and become effective on or before January 1, 2017, and this bill is chaptered last.
Existing law provides for the Medi-Cal program, which is administered by the State Department of Health Care Services, under which qualified low-income individuals receive health care services. The Medi-Cal program is, in part, governed and funded by federal Medicaid program provisions. Existing law provides that federally qualified health center (FQHC) services and rural health clinic (RHC) services, as defined, are covered benefits under the Medi-Cal program, to be reimbursed, to the extent that federal financial participation is obtained, to providers on a per-visit basis. Visit is defined as a face-to-face encounter between a patient of an FQHC or RHC and specified health care professionals. Existing law allows an FQHC or RHC to apply for an adjustment to its per-visit rate based on a change in the scope of services it provides.
This bill would include a marriage and family therapist within those health care professionals covered under that definition. The bill would require an FQHC or RHC that currently includes the cost of services of a dental hygienist in alternative practice, or a marriage and family therapist for the purposes of establishing its FQHC or RHC rate to apply to the department for an adjustment to its per-visit rate if the FQHC or RHC chooses to bill these services as a separate visit, and, after the rate adjustment has been approved by the department, would require the FQHC or RHC to bill these services as a separate visit, as specified. The bill would require an FQHC or RHC that does not provide the services of a dental hygienist, dental hygienist in alternative practice, or a marriage and family therapist, and later elects to add these services and bill these services as a separate visit, to process the addition of these services as a change in scope of service.
This bill would incorporate additional changes in Section 14132.100 of the Welfare and Institutions Code proposed by SB 1335, that would become operative only if SB 1335 and this bill are both chaptered and become effective on or before January 1, 2017, and this bill is chaptered last.
Existing law provides for the Medi-Cal program, which is administered by the State Department of Health Care Services, under which qualified low-income individuals receive health care services. The Medi-Cal program is, in part, governed and funded by federal Medicaid Program program provisions. Existing law provides that federally qualified health center (FQHC) services and rural health clinic (RHC) services, as defined, are covered benefits under the Medi-Cal program, to be reimbursed, to the extent that federal financial participation is obtained, to providers on a per-visit basis. Visit is defined as a face-to-face encounter between a patient of an FQHC or RHC and specified health care professionals. Existing law allows an FQHC or RHC to apply for an adjustment to its per-visit rate based on a change in the scope of services it provides.
This bill would include a marriage and family therapist within those health care professionals covered under that definition. The bill would require an FQHC or RHC that currently includes the cost of services of a dental hygienist in alternative practice, or a marriage and family therapist for the purposes of establishing its FQHC or RHC rate to apply to the department for an adjustment to its per-visit rate, rate if the FQHC or RHC chooses to bill these services as a separate visit, and, after the rate adjustment has been approved by the department, would require the FQHC or RHC to bill these services as a separate visit, as specified. The bill would require an FQHC or RHC that does not provide the services of a dental hygienist, dental hygienist in alternative practice, or a marriage and family therapist, and later elects to add these services, services and bill these services as a separate visit, to process the addition of these services as a change in scope of service.
Existing law provides for the Medi-Cal program, which is administered by the State Department of Health Care Services, under which qualified low-income individuals receive health care services. The Medi-Cal program is, in part, governed and funded by federal Medicaid Program provisions. Existing law provides that federally qualified health center (FQHC) services and rural health clinic (RHC) services, as defined, are covered benefits under the Medi-Cal program, to be reimbursed, to the extent that federal financial participation is obtained, to providers on a per-visit basis. Visit is defined as a face-to-face encounter between a patient of an FQHC or RHC and specified health care professionals. Existing law allows an FQHC or RHC to apply for an adjustment to its per-visit rate based on a change in the scope of services it provides.
This bill would include a marriage and family therapist within those health care professionals covered under that definition. The bill would require an FQHC or RHC that currently includes the cost of services of a marriage and family therapist for the purposes of establishing its FQHC or RHC rate to apply to the department for an adjustment to its per-visit rate, and, after the rate adjustment has been approved by the department, would require the FQHC or RHC to bill these services as a separate visit, as specified. The bill would require an FQHC or RHC that does not provide the services of a marriage and family therapist, and later elects to add these services, to process the addition of these services as a change in scope of service.
(a)The federally qualified health center services described in Section 1396d(a)(2)(C) of Title 42 of the United States Code are covered benefits.
(b)The rural health clinic services described in Section 1396d(a)(2)(B) of Title 42 of the United States Code are covered benefits.
(c)Federally qualified health center services and rural health clinic services shall be reimbursed on a per-visit basis in accordance with the definition of visit set forth in subdivision (g).
(d)Effective October 1, 2004, and on each October 1 thereafter, until no longer required by federal law, federally qualified health center (FQHC) and rural health clinic (RHC) per-visit rates shall be increased by the Medicare Economic Index applicable to primary care services in the manner provided for in Section 1396a(bb)(3)(A) of Title 42 of the United States Code. Prior to January 1, 2004, FQHC and RHC per-visit rates shall be adjusted by the Medicare Economic Index in accordance with the methodology set forth in the state plan in effect on October 1, 2001.
(e)(1)An FQHC or RHC may apply for an adjustment to its per-visit rate based on a change in the scope of services provided by the FQHC or RHC. Rate changes based on a change in the scope of services provided by an FQHC or RHC shall be evaluated in accordance with Medicare reasonable cost principles, as set forth in Part 413 (commencing with Section 413.1) of Title 42 of the Code of Federal Regulations, or its successor.
(2)Subject to the conditions set forth in subparagraphs (A) to (D), inclusive, of paragraph (3), a change in scope of service means any of the following:
(A)The addition of a new FQHC or RHC service that is not incorporated in the baseline prospective payment system (PPS) rate, or a deletion of an FQHC or RHC service that is incorporated in the baseline PPS rate.
(B)A change in service due to amended regulatory requirements or rules.
(C)A change in service resulting from relocating or remodeling an FQHC or RHC.
(D)A change in types of services due to a change in applicable technology and medical practice utilized by the center or clinic.
(E)An increase in service intensity attributable to changes in the types of patients served, including, but not limited to, populations with HIV or AIDS, or other chronic diseases, or homeless, elderly, migrant, or other special populations.
(F)Any changes in any of the services described in subdivision (a) or (b), or in the provider mix of an FQHC or RHC or one of its sites.
(G)Changes in operating costs attributable to capital expenditures associated with a modification of the scope of any of the services described in subdivision (a) or (b), including new or expanded service facilities, regulatory compliance, or changes in technology or medical practices at the center or clinic.
(H)Indirect medical education adjustments and a direct graduate medical education payment that reflects the costs of providing teaching services to interns and residents.
(I)Any changes in the scope of a project approved by the federal Health Resources and Services Administration (HRSA).
(3)No change in costs shall, in and of itself, be considered a scope-of-service change unless all of the following apply:
(A)The increase or decrease in cost is attributable to an increase or decrease in the scope of services defined in subdivisions (a) and (b), as applicable.
(B)The cost is allowable under Medicare reasonable cost principles set forth in Part 413 (commencing with Section 413) of Subchapter B of Chapter 4 of Title 42 of the Code of Federal Regulations, or its successor.
(C)The change in the scope of services is a change in the type, intensity, duration, or amount of services, or any combination thereof.
(D)The net change in the FQHCs or RHCs rate equals or exceeds 1.75 percent for the affected FQHC or RHC site. For FQHCs and RHCs that filed consolidated cost reports for multiple sites to establish the initial prospective payment reimbursement rate, the 1.75-percent threshold shall be applied to the average per-visit rate of all sites for the purposes of calculating the cost associated with a scope-of-service change. Net change means the per-visit rate change attributable to the cumulative effect of all increases and decreases for a particular fiscal year.
(4)An FQHC or RHC may submit requests for scope-of-service changes once per fiscal year, only within 90 days following the beginning of the FQHCs or RHCs fiscal year. Any approved increase or decrease in the providers rate shall be retroactive to the beginning of the FQHCs or RHCs fiscal year in which the request is submitted.
(5)An FQHC or RHC shall submit a scope-of-service rate change request within 90 days of the beginning of any FQHC or RHC fiscal year occurring after the effective date of this section, if, during the FQHCs or RHCs prior fiscal year, the FQHC or RHC experienced a decrease in the scope of services provided that the FQHC or RHC either knew or should have known would have resulted in a significantly lower per-visit rate. If an FQHC or RHC discontinues providing onsite pharmacy or dental services, it shall submit a scope-of-service rate change request within 90 days of the beginning of the following fiscal year. The rate change shall be effective as provided for in paragraph (4). As used in this paragraph, significantly lower means an average per-visit rate decrease in excess of 2.5 percent.
(6)Notwithstanding paragraph (4), if the approved scope-of-service change or changes were initially implemented on or after the first day of an FQHCs or RHCs fiscal year ending in calendar year 2001, but before the adoption and issuance of written instructions for applying for a scope-of-service change, the adjusted reimbursement rate for that scope-of-service change shall be made retroactive to the date the scope-of-service change was initially implemented. Scope-of-service changes under this paragraph shall be required to be submitted within the later of 150 days after the adoption and issuance of the written instructions by the department, or 150 days after the end of the FQHCs or RHCs fiscal year ending in 2003.
(7)All references in this subdivision to fiscal year shall be construed to be references to the fiscal year of the individual FQHC or RHC, as the case may be.
(f)(1)An FQHC or RHC may request a supplemental payment if extraordinary circumstances beyond the control of the FQHC or RHC occur after December 31, 2001, and PPS payments are insufficient due to these extraordinary circumstances. Supplemental payments arising from extraordinary circumstances under this subdivision shall be solely and exclusively within the discretion of the department and shall not be subject to subdivision (l). These supplemental payments shall be determined separately from the scope-of-service adjustments described in subdivision (e). Extraordinary circumstances include, but are not limited to, acts of nature, changes in applicable requirements in the Health and Safety Code, changes in applicable licensure requirements, and changes in applicable rules or regulations. Mere inflation of costs alone, absent extraordinary circumstances, shall not be grounds for supplemental payment. If an FQHCs or RHCs PPS rate is sufficient to cover its overall costs, including those associated with the extraordinary circumstances, then a supplemental payment is not warranted.
(2)The department shall accept requests for supplemental payment at any time throughout the prospective payment rate year.
(3)Requests for supplemental payments shall be submitted in writing to the department and shall set forth the reasons for the request. Each request shall be accompanied by sufficient documentation to enable the department to act upon the request. Documentation shall include the data necessary to demonstrate that the circumstances for which supplemental payment is requested meet the requirements set forth in this section. Documentation shall include both of the following:
(A)A presentation of data to demonstrate reasons for the FQHCs or RHCs request for a supplemental payment.
(B)Documentation showing the cost implications. The cost impact shall be material and significant, two hundred thousand dollars ($200,000) or 1 percent of a facilitys total costs, whichever is less.
(4)A request shall be submitted for each affected year.
(5)Amounts granted for supplemental payment requests shall be paid as lump-sum amounts for those years and not as revised PPS rates, and shall be repaid by the FQHC or RHC to the extent that it is not expended for the specified purposes.
(6)The department shall notify the provider of the departments discretionary decision in writing.
(g)(1)An FQHC or RHC visit means a face-to-face encounter between an FQHC or RHC patient and a physician, physician assistant, nurse practitioner, certified nurse-midwife, clinical psychologist, licensed clinical social worker, or a visiting nurse. For purposes of this section, physician shall be interpreted in a manner consistent with the Centers for Medicare and Medicaid Services Medicare Rural Health Clinic and Federally Qualified Health Center Manual (Publication 27), or its successor, only to the extent that it defines the professionals whose services are reimbursable on a per-visit basis and not as to the types of services that these professionals may render during these visits and shall include a physician and surgeon, osteopath, podiatrist, dentist, optometrist, and chiropractor. A visit shall also include a face-to-face encounter between an FQHC or RHC patient and a comprehensive perinatal practitioner, as defined in Section 51179.7 of Title 22 of the California Code of Regulations, providing comprehensive perinatal services, a four-hour day of attendance at an adult day health care center, and any other provider identified in the state plans definition of an FQHC or RHC visit.
(2)(A)A visit shall also include a face-to-face encounter between an FQHC or RHC patient and a dental hygienist, a dental hygienist in alternative practice, or a marriage and family therapist.
(B)Notwithstanding subdivision (e), if an FQHC or RHC that currently includes the cost of the services of a dental hygienist in alternative practice, or a marriage and family therapist for the purposes of establishing its FQHC or RHC rate chooses to bill these services as a separate visit, the FQHC or RHC shall apply for an adjustment to its per-visit rate, and, after the rate adjustment has been approved by the department, shall bill these services as a separate visit. However, multiple encounters with dental professionals or marriage and family therapists that take place on the same day shall constitute a single visit. The department shall develop the appropriate forms to determine which FQHCs or RHCs rates shall be adjusted and to facilitate the calculation of the adjusted rates. An FQHCs or RHCs application for, or the departments approval of, a rate adjustment pursuant to this subparagraph shall not constitute a change in scope of service within the meaning of subdivision (e). An FQHC or RHC that applies for an adjustment to its rate pursuant to this subparagraph may continue to bill for all other FQHC or RHC visits at its existing per-visit rate, subject to reconciliation, until the rate adjustment for visits between an FQHC or RHC patient and a dental hygienist, a dental hygienist in alternative practice, or a marriage and family therapist has been approved. Any approved increase or decrease in the providers rate shall be made within six months after the date of receipt of the departments rate adjustment forms pursuant to this subparagraph and shall be retroactive to the beginning of the fiscal year in which the FQHC or RHC submits the request, but in no case shall the effective date be earlier than January 1, 2008.
(C)An FQHC or RHC that does not provide dental hygienist, dental hygienist in alternative practice, or marriage and family therapist services, and later elects to add these services and bill these services as a separate visit, shall process the addition of these services as a change in scope of service pursuant to subdivision (e).
(h)If FQHC or RHC services are partially reimbursed by a third-party payer, such as a managed care entity (as defined in Section 1396u-2(a)(1)(B) of Title 42 of the United States Code), the Medicare Program, or the Child Health and Disability Prevention (CHDP) Program, the department shall reimburse an FQHC or RHC for the difference between its per-visit PPS rate and receipts from other plans or programs on a contract-by-contract basis and not in the aggregate, and may not include managed care financial incentive payments that are required by federal law to be excluded from the calculation.
(i)(1)An entity that first qualifies as an FQHC or RHC in the year 2001 or later, a newly licensed facility at a new location added to an existing FQHC or RHC, and any entity that is an existing FQHC or RHC that is relocated to a new site shall each have its reimbursement rate established in accordance with one of the following methods, as selected by the FQHC or RHC:
(A)The rate may be calculated on a per-visit basis in an amount that is equal to the average of the per-visit rates of three comparable FQHCs or RHCs located in the same or adjacent area with a similar caseload.
(B)In the absence of three comparable FQHCs or RHCs with a similar caseload, the rate may be calculated on a per-visit basis in an amount that is equal to the average of the per-visit rates of three comparable FQHCs or RHCs located in the same or an adjacent service area, or in a reasonably similar geographic area with respect to relevant social, health care, and economic characteristics.
(C)At a new entitys one-time election, the department shall establish a reimbursement rate, calculated on a per-visit basis, that is equal to 100 percent of the projected allowable costs to the FQHC or RHC of furnishing FQHC or RHC services during the first 12 months of operation as an FQHC or RHC. After the first 12-month period, the projected per-visit rate shall be increased by the Medicare Economic Index then in effect. The projected allowable costs for the first 12 months shall be cost settled and the prospective payment reimbursement rate shall be adjusted based on actual and allowable cost per visit.
(D)The department may adopt any further and additional methods of setting reimbursement rates for newly qualified FQHCs or RHCs as are consistent with Section 1396a(bb)(4) of Title 42 of the United States Code.
(2)In order for an FQHC or RHC to establish the comparability of its caseload for purposes of subparagraph (A) or (B) of paragraph (1), the department shall require that the FQHC or RHC submit its most recent annual utilization report as submitted to the Office of Statewide Health Planning and Development, unless the FQHC or RHC was not required to file an annual utilization report. FQHCs or RHCs that have experienced changes in their services or caseload subsequent to the filing of the annual utilization report may submit to the department a completed report in the format applicable to the prior calendar year. FQHCs or RHCs that have not previously submitted an annual utilization report shall submit to the department a completed report in the format applicable to the prior calendar year. The FQHC or RHC shall not be required to submit the annual utilization report for the comparable FQHCs or RHCs to the department, but shall be required to identify the comparable FQHCs or RHCs.
(3)The rate for any newly qualified entity set forth under this subdivision shall be effective retroactively to the later of the date that the entity was first qualified by the applicable federal agency as an FQHC or RHC, the date a new facility at a new location was added to an existing FQHC or RHC, or the date on which an existing FQHC or RHC was relocated to a new site. The FQHC or RHC shall be permitted to continue billing for Medi-Cal covered benefits on a fee-for-service basis under its existing provider number until it is informed of its FQHC or RHC enrollment approval, and the department shall reconcile the difference between the fee-for-service payments and the FQHCs or RHCs prospective payment rate at that time.
(j)Visits occurring at an intermittent clinic site, as defined in subdivision (h) of Section 1206 of the Health and Safety Code, of an existing FQHC or RHC, or in a mobile unit as defined by paragraph (2) of subdivision (b) of Section 1765.105 of the Health and Safety Code, shall be billed by and reimbursed at the same rate as the FQHC or RHC establishing the intermittent clinic site or the mobile unit, subject to the right of the FQHC or RHC to request a scope-of-service adjustment to the rate.
(k)An FQHC or RHC may elect to have pharmacy or dental services reimbursed on a fee-for-service basis, utilizing the current fee schedules established for those services. These costs shall be adjusted out of the FQHCs or RHCs clinic base rate as scope-of-service changes. An FQHC or RHC that reverses its election under this subdivision shall revert to its prior rate, subject to an increase to account for all Medicare Economic Index increases occurring during the intervening time period, and subject to any increase or decrease associated with applicable scope-of-service adjustments as provided in subdivision (e).
(l)FQHCs and RHCs may appeal a grievance or complaint concerning ratesetting, scope-of-service changes, and settlement of cost report audits, in the manner prescribed by Section 14171. The rights and remedies provided under this subdivision are cumulative to the rights and remedies available under all other provisions of law of this state.
(m)The department shall, no later than March 30, 2008, promptly seek all necessary federal approvals in order to implement this section, including any amendments to the state plan. To the extent that any element or requirement of this section is not approved, the department shall submit a request to the federal Centers for Medicare and Medicaid Services for any waivers that would be necessary to implement this section.
(n)The department shall implement this section only to the extent that federal financial participation is obtained.
SEC. 1.5.Section 14132.100 of the Welfare and Institutions Code is amended to read:14132.100.(a)The federally qualified health center services described in Section 1396d(a)(2)(C) of Title 42 of the United States Code are covered benefits.
(b)The rural health clinic services described in Section 1396d(a)(2)(B) of Title 42 of the United States Code are covered benefits.
(c)Federally qualified health center services and rural health clinic services shall be reimbursed on a per-visit basis in accordance with the definition of visit set forth in subdivision (g).
(d)Effective October 1, 2004, and on each October 1 thereafter, until no longer required by federal law, federally qualified health center (FQHC) and rural health clinic (RHC) per-visit rates shall be increased by the Medicare Economic Index applicable to primary care services in the manner provided for in Section 1396a(bb)(3)(A) of Title 42 of the United States Code. Prior to January 1, 2004, FQHC and RHC per-visit rates shall be adjusted by the Medicare Economic Index in accordance with the methodology set forth in the state plan in effect on October 1, 2001.
(e)(1)An FQHC or RHC may apply for an adjustment to its per-visit rate based on a change in the scope of services provided by the FQHC or RHC. Rate changes based on a change in the scope of services provided by an FQHC or RHC shall be evaluated in accordance with Medicare reasonable cost principles, as set forth in Part 413 (commencing with Section 413.1) of Title 42 of the Code of Federal Regulations, or its successor.
(2)Subject to the conditions set forth in subparagraphs (A) to (D), inclusive, of paragraph (3), a change in scope of service means any of the following:
(A)The addition of a new FQHC or RHC service that is not incorporated in the baseline prospective payment system (PPS) rate, or a deletion of an FQHC or RHC service that is incorporated in the baseline PPS rate.
(B)A change in service due to amended regulatory requirements or rules.
(C)A change in service resulting from relocating or remodeling an FQHC or RHC.
(D)A change in types of services due to a change in applicable technology and medical practice utilized by the center or clinic.
(E)An increase in service intensity attributable to changes in the types of patients served, including, but not limited to, populations with HIV or AIDS, or other chronic diseases, or homeless, elderly, migrant, or other special populations.
(F)Any changes in any of the services described in subdivision (a) or (b), or in the provider mix of an FQHC or RHC or one of its sites.
(G)Changes in operating costs attributable to capital expenditures associated with a modification of the scope of any of the services described in subdivision (a) or (b), including new or expanded service facilities, regulatory compliance, or changes in technology or medical practices at the center or clinic.
(H)Indirect medical education adjustments and a direct graduate medical education payment that reflects the costs of providing teaching services to interns and residents.
(I)Any changes in the scope of a project approved by the federal Health Resources and Services Administration (HRSA).
(3)No change in costs shall, in and of itself, be considered a scope-of-service change unless all of the following apply:
(A)The increase or decrease in cost is attributable to an increase or decrease in the scope of services defined in subdivisions (a) and (b), as applicable.
(B)The cost is allowable under Medicare reasonable cost principles set forth in Part 413 (commencing with Section 413) of Subchapter B of Chapter 4 of Title 42 of the Code of Federal Regulations, or its successor.
(C)The change in the scope of services is a change in the type, intensity, duration, or amount of services, or any combination thereof.
(D)The net change in the FQHCs or RHCs rate equals or exceeds 1.75 percent for the affected FQHC or RHC site. For FQHCs and RHCs that filed consolidated cost reports for multiple sites to establish the initial prospective payment reimbursement rate, the 1.75-percent threshold shall be applied to the average per-visit rate of all sites for the purposes of calculating the cost associated with a scope-of-service change. Net change means the per-visit rate change attributable to the cumulative effect of all increases and decreases for a particular fiscal year.
(4)An FQHC or RHC may submit requests for scope-of-service changes once per fiscal year, only within 90 days following the beginning of the FQHCs or RHCs fiscal year. Any approved increase or decrease in the providers rate shall be retroactive to the beginning of the FQHCs or RHCs fiscal year in which the request is submitted.
(5)An FQHC or RHC shall submit a scope-of-service rate change request within 90 days of the beginning of any FQHC or RHC fiscal year occurring after the effective date of this section, if, during the FQHCs or RHCs prior fiscal year, the FQHC or RHC experienced a decrease in the scope of services provided that the FQHC or RHC either knew or should have known would have resulted in a significantly lower per-visit rate. If an FQHC or RHC discontinues providing onsite pharmacy or dental services, it shall submit a scope-of-service rate change request within 90 days of the beginning of the following fiscal year. The rate change shall be effective as provided for in paragraph (4). As used in this paragraph, significantly lower means an average per-visit rate decrease in excess of 2.5 percent.
(6)Notwithstanding paragraph (4), if the approved scope-of-service change or changes were initially implemented on or after the first day of an FQHCs or RHCs fiscal year ending in calendar year 2001, but before the adoption and issuance of written instructions for applying for a scope-of-service change, the adjusted reimbursement rate for that scope-of-service change shall be made retroactive to the date the scope-of-service change was initially implemented. Scope-of-service changes under this paragraph shall be required to be submitted within the later of 150 days after the adoption and issuance of the written instructions by the department, or 150 days after the end of the FQHCs or RHCs fiscal year ending in 2003.
(7)All references in this subdivision to fiscal year shall be construed to be references to the fiscal year of the individual FQHC or RHC, as the case may be.
(f)(1)An FQHC or RHC may request a supplemental payment if extraordinary circumstances beyond the control of the FQHC or RHC occur after December 31, 2001, and PPS payments are insufficient due to these extraordinary circumstances. Supplemental payments arising from extraordinary circumstances under this subdivision shall be solely and exclusively within the discretion of the department and shall not be subject to subdivision (l). These supplemental payments shall be determined separately from the scope-of-service adjustments described in subdivision (e). Extraordinary circumstances include, but are not limited to, acts of nature, changes in applicable requirements in the Health and Safety Code, changes in applicable licensure requirements, and changes in applicable rules or regulations. Mere inflation of costs alone, absent extraordinary circumstances, shall not be grounds for supplemental payment. If an FQHCs or RHCs PPS rate is sufficient to cover its overall costs, including those associated with the extraordinary circumstances, then a supplemental payment is not warranted.
(2)The department shall accept requests for supplemental payment at any time throughout the prospective payment rate year.
(3)Requests for supplemental payments shall be submitted in writing to the department and shall set forth the reasons for the request. Each request shall be accompanied by sufficient documentation to enable the department to act upon the request. Documentation shall include the data necessary to demonstrate that the circumstances for which supplemental payment is requested meet the requirements set forth in this section. Documentation shall include both of the following:
(A)A presentation of data to demonstrate reasons for the FQHCs or RHCs request for a supplemental payment.
(B)Documentation showing the cost implications. The cost impact shall be material and significant, two hundred thousand dollars ($200,000) or 1 percent of a facilitys total costs, whichever is less.
(4)A request shall be submitted for each affected year.
(5)Amounts granted for supplemental payment requests shall be paid as lump-sum amounts for those years and not as revised PPS rates, and shall be repaid by the FQHC or RHC to the extent that it is not expended for the specified purposes.
(6)The department shall notify the provider of the departments discretionary decision in writing.
(g)(1)An FQHC or RHC visit means a face-to-face encounter between an FQHC or RHC patient and a physician, physician assistant, nurse practitioner, certified nurse-midwife, clinical psychologist, licensed clinical social worker, or a visiting nurse. For purposes of this section, physician shall be interpreted in a manner consistent with the Centers for Medicare and Medicaid Services Medicare Rural Health Clinic and Federally Qualified Health Center Manual (Publication 27), or its successor, only to the extent that it defines the professionals whose services are reimbursable on a per-visit basis and not as to the types of services that these professionals may render during these visits and shall include a physician and surgeon, osteopath, podiatrist, dentist, optometrist, and chiropractor. A visit shall also include a face-to-face encounter between an FQHC or RHC patient and a comprehensive perinatal practitioner, as defined in Section 51179.7 of Title 22 of the California Code of Regulations, providing comprehensive perinatal services, a four-hour day of attendance at an adult day health care center, and any other provider identified in the state plans definition of an FQHC or RHC visit.
(2)(A)A visit shall also include a face-to-face encounter between an FQHC or RHC patient and a dental hygienist, a dental hygienist in alternative practice, or a marriage and family therapist.
(B)Notwithstanding subdivision (e), if an FQHC or RHC that currently includes the cost of the services of a dental hygienist in alternative practice, or a marriage and family therapist for the purposes of establishing its FQHC or RHC rate chooses to bill these services as a separate visit, the FQHC or RHC shall apply for an adjustment to its per-visit rate, and, after the rate adjustment has been approved by the department, shall bill these services as a separate visit. However, multiple encounters with dental professionals or marriage and family therapists that take place on the same day shall constitute a single visit. The department shall develop the appropriate forms to determine which FQHCs or RHCs rates shall be adjusted and to facilitate the calculation of the adjusted rates. An FQHCs or RHCs application for, or the departments approval of, a rate adjustment pursuant to this subparagraph shall not constitute a change in scope of service within the meaning of subdivision (e). An FQHC or RHC that applies for an adjustment to its rate pursuant to this subparagraph may continue to bill for all other FQHC or RHC visits at its existing per-visit rate, subject to reconciliation, until the rate adjustment for visits between an FQHC or RHC patient and a dental hygienist, a dental hygienist in alternative practice, or a marriage and family therapist has been approved. Any approved increase or decrease in the providers rate shall be made within six months after the date of receipt of the departments rate adjustment forms pursuant to this subparagraph and shall be retroactive to the beginning of the fiscal year in which the FQHC or RHC submits the request, but in no case shall the effective date be earlier than January 1, 2008.
(C)An FQHC or RHC that does not provide dental hygienist, dental hygienist in alternative practice, or marriage and family therapist services, and later elects to add these services and bill these services as a separate visit, shall process the addition of these services as a change in scope of service pursuant to subdivision (e).
(h)If FQHC or RHC services are partially reimbursed by a third-party payer, such as a managed care entity (as defined in Section 1396u-2(a)(1)(B) of Title 42 of the United States Code), the Medicare Program, or the Child Health and Disability Prevention (CHDP) Program, the department shall reimburse an FQHC or RHC for the difference between its per-visit PPS rate and receipts from other plans or programs on a contract-by-contract basis and not in the aggregate, and may not include managed care financial incentive payments that are required by federal law to be excluded from the calculation.
(i)(1)An entity that first qualifies as an FQHC or RHC in the year 2001 or later, a newly licensed facility at a new location added to an existing FQHC or RHC, and any entity that is an existing FQHC or RHC that is relocated to a new site shall each have its reimbursement rate established in accordance with one of the following methods, as selected by the FQHC or RHC:
(A)The rate may be calculated on a per-visit basis in an amount that is equal to the average of the per-visit rates of three comparable FQHCs or RHCs located in the same or adjacent area with a similar caseload.
(B)In the absence of three comparable FQHCs or RHCs with a similar caseload, the rate may be calculated on a per-visit basis in an amount that is equal to the average of the per-visit rates of three comparable FQHCs or RHCs located in the same or an adjacent service area, or in a reasonably similar geographic area with respect to relevant social, health care, and economic characteristics.
(C)At a new entitys one-time election, the department shall establish a reimbursement rate, calculated on a per-visit basis, that is equal to 100 percent of the projected allowable costs to the FQHC or RHC of furnishing FQHC or RHC services during the first 12 months of operation as an FQHC or RHC. After the first 12-month period, the projected per-visit rate shall be increased by the Medicare Economic Index then in effect. The projected allowable costs for the first 12 months shall be cost settled and the prospective payment reimbursement rate shall be adjusted based on actual and allowable cost per visit.
(D)The department may adopt any further and additional methods of setting reimbursement rates for newly qualified FQHCs or RHCs as are consistent with Section 1396a(bb)(4) of Title 42 of the United States Code.
(2)In order for an FQHC or RHC to establish the comparability of its caseload for purposes of subparagraph (A) or (B) of paragraph (1), the department shall require that the FQHC or RHC submit its most recent annual utilization report as submitted to the Office of Statewide Health Planning and Development, unless the FQHC or RHC was not required to file an annual utilization report. FQHCs or RHCs that have experienced changes in their services or caseload subsequent to the filing of the annual utilization report may submit to the department a completed report in the format applicable to the prior calendar year. FQHCs or RHCs that have not previously submitted an annual utilization report shall submit to the department a completed report in the format applicable to the prior calendar year. The FQHC or RHC shall not be required to submit the annual utilization report for the comparable FQHCs or RHCs to the department, but shall be required to identify the comparable FQHCs or RHCs.
(3)The rate for any newly qualified entity set forth under this subdivision shall be effective retroactively to the later of the date that the entity was first qualified by the applicable federal agency as an FQHC or RHC, the date a new facility at a new location was added to an existing FQHC or RHC, or the date on which an existing FQHC or RHC was relocated to a new site. The FQHC or RHC shall be permitted to continue billing for Medi-Cal covered benefits on a fee-for-service basis under its existing provider number until it is informed of its FQHC or RHC enrollment approval, and the department shall reconcile the difference between the fee-for-service payments and the FQHCs or RHCs prospective payment rate at that time.
(j)Visits occurring at an intermittent clinic site, as defined in subdivision (h) of Section 1206 of the Health and Safety Code, of an existing FQHC or RHC, or in a mobile unit as defined by paragraph (2) of subdivision (b) of Section 1765.105 of the Health and Safety Code, shall be billed by and reimbursed at the same rate as the FQHC or RHC establishing the intermittent clinic site or the mobile unit, subject to the right of the FQHC or RHC to request a scope-of-service adjustment to the rate.
(k)(1)Notwithstanding any other provision of this section requiring the use of a per-visit reimbursement rate, as described in subdivision (c), this subdivision shall govern reimbursement for services identified in this subdivision.
(2)An FQHC or RHC may elect to have pharmacy services or dental services reimbursed on a fee-for-services basis, utilizing the current fee schedules established for those services.
(3)An FQHC or RHC may elect to enroll as a Drug Medi-Cal certified provider. If an FQHC or RHC elects to enroll as a Drug Medi-Cal certified provider, the costs associated with the Drug Medi-Cal services shall not be included in the FQHCs or RHCs per-visit PPS rate and the reimbursement for those services shall be governed by subparagraph (A) or (B).
(A)If the FQHC or RHC elects to provide Drug Medi-Cal services in a county that has elected to participate in the Drug Medi-Cal organized delivery system, the FQHC or RHC shall receive reimbursement pursuant to a mutually agreed upon contract between the county and the FQHC or RHC. If an FQHC or RHC is denied a contract by the county, the FQHC or RHC may follow the contract denial process set forth in the Special Terms and Conditions.
(B)If the FQHC or RHC elects to provide Drug Medi-Cal services in a county that does not elect to participate in the Drug Medi-Cal organized delivery system, the FQHC or RHC shall receive reimbursement pursuant to a mutually agreed upon contract between the county and the FQHC or RHC. If the county refuses to contract with the FQHC or RHC, the FQHC or RHC may request to contract directly with the department and shall be reimbursed for those services at the fee-for-service rate.
(4)(A)If an FQHC or RHC elects reimbursement pursuant to paragraph (2) or (3), pursuant to which the costs associated with providing the services are part of the FQHCs or RHCs clinic base rate, those costs shall be adjusted out of the FQHCs or RHCs clinic base rate as scope-of-service changes and payment pursuant to subdivision (h) shall not apply.
(B)An FQHC or RHC that reverses its election under paragraph (2) or (3) shall revert to its prior rate, subject to an increase to account for all Medicare Economic Index increases occurring during the intervening time period, and subject to any increases or decreases associated with applicable scope-of-service adjustments as provided in subdivision (e).
(5)(A)An FQHC or RHC shall submit a scope-of-service rate change request within 90 days of the beginning of any FQHC or RHC fiscal year occurring after January 1, 2017, if, during the FQHCs or RHCs prior fiscal year, both of the following occurred:
(i)The FQHC or RHC elected reimbursement pursuant to paragraph (3).
(ii)The costs of providing Drug Medi-Cal services were included in the per-visit PPS rate and the removal of those costs would have resulted in a significantly lower per-visit PPS rate. For purposes of this subparagraph, significantly lower means an average per-visit PPS rate decrease in excess of 2.5 percent.
(B)Within 90 days of receipt of the request for a scope-of-service change, the department shall issue the FQHC or RHC an interim rate equal to 90 percent of the FQHCs or RHCs projected allowable cost as determined by the department. The audit performed to determine the final rate shall be performed in accordance with Section 14170.
(6)If an FQHC or RHC makes an election pursuant to paragraph (3) and a scope-of-service change is necessary pursuant to paragraphs (4) and (5), the FQHC or RHC shall comply with both of the following:
(A)After the department approves the request for a scope-of-service change and adjusts the per-visit PPS rate pursuant to paragraph (4), the FQHC or RHC shall not bill the per-visit PPS rate for services reimbursed by the Drug Medi-Cal organized delivery system.
(B)For the purpose of calculating a per-visit PPS rate, the FQHC or RHC shall provide verifiable documentation of the costs of an employee who provides both FQHC services and Drug Medi-Cal services. Documentation shall attribute costs proportionally between FQHC services and Drug Medi-Cal services. Only the costs attributable to FQHC services shall be included in the per-visit PPS rate.
(7)If an FQHC or RHC was enrolled as a Drug Medi-Cal certified provider on or before January 1, 2017, the FQHC or RHC may continue to provide, and be reimbursed for, Drug Medi-Cal services pursuant to the terms of the contract if the costs of providing Drug Medi-Cal services are reimbursed outside of the per-visit PPS rate described in subdivision (c).
(8)(A)If an FQHC or RHC entered into a contract on or before January 1, 2017, with a mental health plan to provide specialty mental health services to Medi-Cal beneficiaries as part of the mental health plans network, the FQHC or RHC may continue to provide, and be reimbursed for, those specialty mental health services pursuant to the terms of the contract with the mental health plan if the costs of providing specialty mental health services are reimbursed outside of the per-visit PPS rate described in subdivision (c).
(B)For purposes of this paragraph, mental health plan means any mental health plan contracting with the department to provide specialty mental health services to enrolled Medi-Cal beneficiaries under Article 5 (commencing with Section 14680) of Chapter 8.8 or Chapter 8.9 (commencing with Section 14700).
(9)Nothing in this subdivision shall be construed to alter or otherwise change the process applicable to an FQHC or RHC making an election pursuant to paragraph (2).
(10)For purposes of this subdivision, the following definitions shall apply:
(A)Drug Medi-Cal organized delivery system means the Drug Medi-Cal organized delivery system authorized under the California Medi-Cal 2020 Demonstration, Number 11-W-00193/9, as approved by the federal Centers for Medicare and Medicaid Services and described in the Special Terms and Conditions.
(B)Special Terms and Conditions shall have the same meaning as set forth in subdivision (o) of Section 14184.10.
(l)FQHCs and RHCs may appeal a grievance or complaint concerning ratesetting, scope-of-service changes, and settlement of cost report audits, in the manner prescribed by Section 14171. The rights and remedies provided under this subdivision are cumulative to the rights and remedies available under all other provisions of law of this state.
(m)The department shall, no later than March 30, 2008, promptly seek all necessary federal approvals in order to implement this section, including any amendments to the state plan. To the extent that any element or requirement of this section is not approved, the department shall submit a request to the federal Centers for Medicare and Medicaid Services for any waivers that would be necessary to implement this section.
(n)The department shall implement this section only to the extent that federal financial participation is obtained.
SEC. 2.Section 1.5 of this bill incorporates amendments to Section 14132.100 of the Welfare and Institutions Code proposed by both this bill and Senate Bill 1335. It shall only become operative if (1) both bills are enacted and become effective on or before January 1, 2017, (2) each bill amends Section 14132.100 of the Welfare and Institutions Code, and (3) this bill is enacted after Senate Bill 1335, in which case Section 1 of this bill shall not become operative.
(a)The federally qualified health center services described in Section 1396d(a)(2)(C) of Title 42 of the United States Code are covered benefits.
(b)The rural health clinic services described in Section 1396d(a)(2)(B) of Title 42 of the United States Code are covered benefits.
(c)Federally qualified health center services and rural health clinic services shall be reimbursed on a per-visit basis in accordance with the definition of visit set forth in subdivision (g).
(d)Effective October 1, 2004, and on each October 1 thereafter, until no longer required by federal law, federally qualified health center (FQHC) and rural health clinic (RHC) per-visit rates shall be increased by the Medicare Economic Index applicable to primary care services in the manner provided for in Section 1396a(bb)(3)(A) of Title 42 of the United States Code. Prior to January 1, 2004, FQHC and RHC per-visit rates shall be adjusted by the Medicare Economic Index in accordance with the methodology set forth in the state plan in effect on October 1, 2001.
(e)(1)An FQHC or RHC may apply for an adjustment to its per-visit rate based on a change in the scope of services provided by the FQHC or RHC. Rate changes based on a change in the scope of services provided by an FQHC or RHC shall be evaluated in accordance with Medicare reasonable cost principles, as set forth in Part 413 (commencing with Section 413.1) of Title 42 of the Code of Federal Regulations, or its successor.
(2)Subject to the conditions set forth in subparagraphs (A) to (D), inclusive, of paragraph (3), a change in scope of service means any of the following:
(A)The addition of a new FQHC or RHC service that is not incorporated in the baseline prospective payment system (PPS) rate, or a deletion of an FQHC or RHC service that is incorporated in the baseline PPS rate.
(B)A change in service due to amended regulatory requirements or rules.
(C)A change in service resulting from relocating or remodeling an FQHC or RHC.
(D)A change in types of services due to a change in applicable technology and medical practice utilized by the center or clinic.
(E)An increase in service intensity attributable to changes in the types of patients served, including, but not limited to, populations with HIV or AIDS, or other chronic diseases, or homeless, elderly, migrant, or other special populations.
(F)Any changes in any of the services described in subdivision (a) or (b), or in the provider mix of an FQHC or RHC or one of its sites.
(G)Changes in operating costs attributable to capital expenditures associated with a modification of the scope of any of the services described in subdivision (a) or (b), including new or expanded service facilities, regulatory compliance, or changes in technology or medical practices at the center or clinic.
(H)Indirect medical education adjustments and a direct graduate medical education payment that reflects the costs of providing teaching services to interns and residents.
(I)Any changes in the scope of a project approved by the federal Health Resources and Services Administration (HRSA).
(3)No change in costs shall, in and of itself, be considered a scope-of-service change unless all of the following apply:
(A)The increase or decrease in cost is attributable to an increase or decrease in the scope of services defined in subdivisions (a) and (b), as applicable.
(B)The cost is allowable under Medicare reasonable cost principles set forth in Part 413 (commencing with Section 413) of Subchapter B of Chapter 4 of Title 42 of the Code of Federal Regulations, or its successor.
(C)The change in the scope of services is a change in the type, intensity, duration, or amount of services, or any combination thereof.
(D)The net change in the FQHCs or RHCs rate equals or exceeds 1.75 percent for the affected FQHC or RHC site. For FQHCs and RHCs that filed consolidated cost reports for multiple sites to establish the initial prospective payment reimbursement rate, the 1.75-percent threshold shall be applied to the average per-visit rate of all sites for the purposes of calculating the cost associated with a scope-of-service change. Net change means the per-visit rate change attributable to the cumulative effect of all increases and decreases for a particular fiscal year.
(4)An FQHC or RHC may submit requests for scope-of-service changes once per fiscal year, only within 90 days following the beginning of the FQHCs or RHCs fiscal year. Any approved increase or decrease in the providers rate shall be retroactive to the beginning of the FQHCs or RHCs fiscal year in which the request is submitted.
(5)An FQHC or RHC shall submit a scope-of-service rate change request within 90 days of the beginning of any FQHC or RHC fiscal year occurring after the effective date of this section, if, during the FQHCs or RHCs prior fiscal year, the FQHC or RHC experienced a decrease in the scope of services provided that the FQHC or RHC either knew or should have known would have resulted in a significantly lower per-visit rate. If an FQHC or RHC discontinues providing onsite pharmacy or dental services, it shall submit a scope-of-service rate change request within 90 days of the beginning of the following fiscal year. The rate change shall be effective as provided for in paragraph (4). As used in this paragraph, significantly lower means an average per-visit rate decrease in excess of 2.5 percent.
(6)Notwithstanding paragraph (4), if the approved scope-of-service change or changes were initially implemented on or after the first day of an FQHCs or RHCs fiscal year ending in calendar year 2001, but before the adoption and issuance of written instructions for applying for a scope-of-service change, the adjusted reimbursement rate for that scope-of-service change shall be made retroactive to the date the scope-of-service change was initially implemented. Scope-of-service changes under this paragraph shall be required to be submitted within the later of 150 days after the adoption and issuance of the written instructions by the department, or 150 days after the end of the FQHCs or RHCs fiscal year ending in 2003.
(7)All references in this subdivision to fiscal year shall be construed to be references to the fiscal year of the individual FQHC or RHC, as the case may be.
(f)(1)An FQHC or RHC may request a supplemental payment if extraordinary circumstances beyond the control of the FQHC or RHC occur after December 31, 2001, and PPS payments are insufficient due to these extraordinary circumstances. Supplemental payments arising from extraordinary circumstances under this subdivision shall be solely and exclusively within the discretion of the department and shall not be subject to subdivision (l). These supplemental payments shall be determined separately from the scope-of-service adjustments described in subdivision (e). Extraordinary circumstances include, but are not limited to, acts of nature, changes in applicable requirements in the Health and Safety Code, changes in applicable licensure requirements, and changes in applicable rules or regulations. Mere inflation of costs alone, absent extraordinary circumstances, shall not be grounds for supplemental payment. If an FQHCs or RHCs PPS rate is sufficient to cover its overall costs, including those associated with the extraordinary circumstances, then a supplemental payment is not warranted.
(2)The department shall accept requests for supplemental payment at any time throughout the prospective payment rate year.
(3)Requests for supplemental payments shall be submitted in writing to the department and shall set forth the reasons for the request. Each request shall be accompanied by sufficient documentation to enable the department to act upon the request. Documentation shall include the data necessary to demonstrate that the circumstances for which supplemental payment is requested meet the requirements set forth in this section. Documentation shall include both of the following:
(A)A presentation of data to demonstrate reasons for the FQHCs or RHCs request for a supplemental payment.
(B)Documentation showing the cost implications. The cost impact shall be material and significant, two hundred thousand dollars ($200,000) or 1 percent of a facilitys total costs, whichever is less.
(4)A request shall be submitted for each affected year.
(5)Amounts granted for supplemental payment requests shall be paid as lump-sum amounts for those years and not as revised PPS rates, and shall be repaid by the FQHC or RHC to the extent that it is not expended for the specified purposes.
(6)The department shall notify the provider of the departments discretionary decision in writing.
(g)(1)An FQHC or RHC visit means a face-to-face encounter between an FQHC or RHC patient and a physician, physician assistant, nurse practitioner, certified nurse-midwife, clinical psychologist, licensed clinical social worker, or a visiting nurse. For purposes of this section, physician shall be interpreted in a manner consistent with the Centers for Medicare and Medicaid Services Medicare Rural Health Clinic and Federally Qualified Health Center Manual (Publication 27), or its successor, only to the extent that it defines the professionals whose services are reimbursable on a per-visit basis and not as to the types of services that these professionals may render during these visits and shall include a physician and surgeon, osteopath, podiatrist, dentist, optometrist, and chiropractor. A visit shall also include a face-to-face encounter between an FQHC or RHC patient and a comprehensive perinatal practitioner, as defined in Section 51179.7 of Title 22 of the California Code of Regulations, providing comprehensive perinatal services, a four-hour day of attendance at an adult day health care center, and any other provider identified in the state plans definition of an FQHC or RHC visit.
(2)(A)A visit shall also include a face-to-face encounter between an FQHC or RHC patient and a dental hygienist, a dental hygienist in alternative practice, or a marriage and family therapist.
(B)Notwithstanding subdivision (e), if an FQHC or RHC that currently includes the cost of the services of a dental hygienist in alternative practice, or a marriage and family therapist for the purposes of establishing its FQHC or RHC rate chooses to bill these services as a separate visit, the FQHC or RHC shall apply for an adjustment to its per-visit rate, and, after the rate adjustment has been approved by the department, shall bill these services as a separate visit. However, multiple encounters with dental professionals or marriage and family therapists that take place on the same day shall constitute a single visit. The department shall develop the appropriate forms to determine which FQHCs or RHCs rates shall be adjusted and to facilitate the calculation of the adjusted rates. An FQHCs or RHCs application for, or the departments approval of, a rate adjustment pursuant to this subparagraph shall not constitute a change in scope of service within the meaning of subdivision (e). An FQHC or RHC that applies for an adjustment to its rate pursuant to this subparagraph may continue to bill for all other FQHC or RHC visits at its existing per-visit rate, subject to reconciliation, until the rate adjustment for visits between an FQHC or RHC patient and a dental hygienist, a dental hygienist in alternative practice, or a marriage and family therapist has been approved. Any approved increase or decrease in the providers rate shall be made within six months after the date of receipt of the departments rate adjustment forms pursuant to this subparagraph and shall be retroactive to the beginning of the fiscal year in which the FQHC or RHC submits the request, but in no case shall the effective date be earlier than January 1, 2008.
(C)An FQHC or RHC that does not provide dental hygienist, dental hygienist in alternative practice, or marriage and family therapist services, and later elects to add these services and bill these services as a separate visit, shall process the addition of these services as a change in scope of service pursuant to subdivision (e).
(h)If FQHC or RHC services are partially reimbursed by a third-party payer, such as a managed care entity (as defined in Section 1396u-2(a)(1)(B) of Title 42 of the United States Code), the Medicare Program, or the Child Health and Disability Prevention (CHDP) Program, the department shall reimburse an FQHC or RHC for the difference between its per-visit PPS rate and receipts from other plans or programs on a contract-by-contract basis and not in the aggregate, and may not include managed care financial incentive payments that are required by federal law to be excluded from the calculation.
(i)(1)An entity that first qualifies as an FQHC or RHC in the year 2001 or later, a newly licensed facility at a new location added to an existing FQHC or RHC, and any entity that is an existing FQHC or RHC that is relocated to a new site shall each have its reimbursement rate established in accordance with one of the following methods, as selected by the FQHC or RHC:
(A)The rate may be calculated on a per-visit basis in an amount that is equal to the average of the per-visit rates of three comparable FQHCs or RHCs located in the same or adjacent area with a similar caseload.
(B)In the absence of three comparable FQHCs or RHCs with a similar caseload, the rate may be calculated on a per-visit basis in an amount that is equal to the average of the per-visit rates of three comparable FQHCs or RHCs located in the same or an adjacent service area, or in a reasonably similar geographic area with respect to relevant social, health care, and economic characteristics.
(C)At a new entitys one-time election, the department shall establish a reimbursement rate, calculated on a per-visit basis, that is equal to 100 percent of the projected allowable costs to the FQHC or RHC of furnishing FQHC or RHC services during the first 12 months of operation as an FQHC or RHC. After the first 12-month period, the projected per-visit rate shall be increased by the Medicare Economic Index then in effect. The projected allowable costs for the first 12 months shall be cost settled and the prospective payment reimbursement rate shall be adjusted based on actual and allowable cost per visit.
(D)The department may adopt any further and additional methods of setting reimbursement rates for newly qualified FQHCs or RHCs as are consistent with Section 1396a(bb)(4) of Title 42 of the United States Code.
(2)In order for an FQHC or RHC to establish the comparability of its caseload for purposes of subparagraph (A) or (B) of paragraph (1), the department shall require that the FQHC or RHC submit its most recent annual utilization report as submitted to the Office of Statewide Health Planning and Development, unless the FQHC or RHC was not required to file an annual utilization report. FQHCs or RHCs that have experienced changes in their services or caseload subsequent to the filing of the annual utilization report may submit to the department a completed report in the format applicable to the prior calendar year. FQHCs or RHCs that have not previously submitted an annual utilization report shall submit to the department a completed report in the format applicable to the prior calendar year. The FQHC or RHC shall not be required to submit the annual utilization report for the comparable FQHCs or RHCs to the department, but shall be required to identify the comparable FQHCs or RHCs.
(3)The rate for any newly qualified entity set forth under this subdivision shall be effective retroactively to the later of the date that the entity was first qualified by the applicable federal agency as an FQHC or RHC, the date a new facility at a new location was added to an existing FQHC or RHC, or the date on which an existing FQHC or RHC was relocated to a new site. The FQHC or RHC shall be permitted to continue billing for Medi-Cal covered benefits on a fee-for-service basis under its existing provider number until it is informed of its FQHC or RHC enrollment approval, and the department shall reconcile the difference between the fee-for-service payments and the FQHCs or RHCs prospective payment rate at that time.
(j)Visits occurring at an intermittent clinic site, as defined in subdivision (h) of Section 1206 of the Health and Safety Code, of an existing FQHC or RHC, or in a mobile unit as defined by paragraph (2) of subdivision (b) of Section 1765.105 of the Health and Safety Code, shall be billed by and reimbursed at the same rate as the FQHC or RHC establishing the intermittent clinic site or the mobile unit, subject to the right of the FQHC or RHC to request a scope-of-service adjustment to the rate.
(k)An FQHC or RHC may elect to have pharmacy or dental services reimbursed on a fee-for-service basis, utilizing the current fee schedules established for those services. These costs shall be adjusted out of the FQHCs or RHCs clinic base rate as scope-of-service changes. An FQHC or RHC that reverses its election under this subdivision shall revert to its prior rate, subject to an increase to account for all Medicare Economic Index increases occurring during the intervening time period, and subject to any increase or decrease associated with applicable scope-of-service adjustments as provided in subdivision (e).
(l)FQHCs and RHCs may appeal a grievance or complaint concerning ratesetting, scope-of-service changes, and settlement of cost report audits, in the manner prescribed by Section 14171. The rights and remedies provided under this subdivision are cumulative to the rights and remedies available under all other provisions of law of this state.
(m)The department shall, no later than March 30, 2008, promptly seek all necessary federal approvals in order to implement this section, including any amendments to the state plan. To the extent that any element or requirement of this section is not approved, the department shall submit a request to the federal Centers for Medicare and Medicaid Services for any waivers that would be necessary to implement this section.
(n)The department shall implement this section only to the extent that federal financial participation is obtained.
SEC. 1.5.Section 14132.100 of the Welfare and Institutions Code is amended to read:14132.100.(a)The federally qualified health center services described in Section 1396d(a)(2)(C) of Title 42 of the United States Code are covered benefits.
(b)The rural health clinic services described in Section 1396d(a)(2)(B) of Title 42 of the United States Code are covered benefits.
(c)Federally qualified health center services and rural health clinic services shall be reimbursed on a per-visit basis in accordance with the definition of visit set forth in subdivision (g).
(d)Effective October 1, 2004, and on each October 1 thereafter, until no longer required by federal law, federally qualified health center (FQHC) and rural health clinic (RHC) per-visit rates shall be increased by the Medicare Economic Index applicable to primary care services in the manner provided for in Section 1396a(bb)(3)(A) of Title 42 of the United States Code. Prior to January 1, 2004, FQHC and RHC per-visit rates shall be adjusted by the Medicare Economic Index in accordance with the methodology set forth in the state plan in effect on October 1, 2001.
(e)(1)An FQHC or RHC may apply for an adjustment to its per-visit rate based on a change in the scope of services provided by the FQHC or RHC. Rate changes based on a change in the scope of services provided by an FQHC or RHC shall be evaluated in accordance with Medicare reasonable cost principles, as set forth in Part 413 (commencing with Section 413.1) of Title 42 of the Code of Federal Regulations, or its successor.
(2)Subject to the conditions set forth in subparagraphs (A) to (D), inclusive, of paragraph (3), a change in scope of service means any of the following:
(A)The addition of a new FQHC or RHC service that is not incorporated in the baseline prospective payment system (PPS) rate, or a deletion of an FQHC or RHC service that is incorporated in the baseline PPS rate.
(B)A change in service due to amended regulatory requirements or rules.
(C)A change in service resulting from relocating or remodeling an FQHC or RHC.
(D)A change in types of services due to a change in applicable technology and medical practice utilized by the center or clinic.
(E)An increase in service intensity attributable to changes in the types of patients served, including, but not limited to, populations with HIV or AIDS, or other chronic diseases, or homeless, elderly, migrant, or other special populations.
(F)Any changes in any of the services described in subdivision (a) or (b), or in the provider mix of an FQHC or RHC or one of its sites.
(G)Changes in operating costs attributable to capital expenditures associated with a modification of the scope of any of the services described in subdivision (a) or (b), including new or expanded service facilities, regulatory compliance, or changes in technology or medical practices at the center or clinic.
(H)Indirect medical education adjustments and a direct graduate medical education payment that reflects the costs of providing teaching services to interns and residents.
(I)Any changes in the scope of a project approved by the federal Health Resources and Services Administration (HRSA).
(3)No change in costs shall, in and of itself, be considered a scope-of-service change unless all of the following apply:
(A)The increase or decrease in cost is attributable to an increase or decrease in the scope of services defined in subdivisions (a) and (b), as applicable.
(B)The cost is allowable under Medicare reasonable cost principles set forth in Part 413 (commencing with Section 413) of Subchapter B of Chapter 4 of Title 42 of the Code of Federal Regulations, or its successor.
(C)The change in the scope of services is a change in the type, intensity, duration, or amount of services, or any combination thereof.
(D)The net change in the FQHCs or RHCs rate equals or exceeds 1.75 percent for the affected FQHC or RHC site. For FQHCs and RHCs that filed consolidated cost reports for multiple sites to establish the initial prospective payment reimbursement rate, the 1.75-percent threshold shall be applied to the average per-visit rate of all sites for the purposes of calculating the cost associated with a scope-of-service change. Net change means the per-visit rate change attributable to the cumulative effect of all increases and decreases for a particular fiscal year.
(4)An FQHC or RHC may submit requests for scope-of-service changes once per fiscal year, only within 90 days following the beginning of the FQHCs or RHCs fiscal year. Any approved increase or decrease in the providers rate shall be retroactive to the beginning of the FQHCs or RHCs fiscal year in which the request is submitted.
(5)An FQHC or RHC shall submit a scope-of-service rate change request within 90 days of the beginning of any FQHC or RHC fiscal year occurring after the effective date of this section, if, during the FQHCs or RHCs prior fiscal year, the FQHC or RHC experienced a decrease in the scope of services provided that the FQHC or RHC either knew or should have known would have resulted in a significantly lower per-visit rate. If an FQHC or RHC discontinues providing onsite pharmacy or dental services, it shall submit a scope-of-service rate change request within 90 days of the beginning of the following fiscal year. The rate change shall be effective as provided for in paragraph (4). As used in this paragraph, significantly lower means an average per-visit rate decrease in excess of 2.5 percent.
(6)Notwithstanding paragraph (4), if the approved scope-of-service change or changes were initially implemented on or after the first day of an FQHCs or RHCs fiscal year ending in calendar year 2001, but before the adoption and issuance of written instructions for applying for a scope-of-service change, the adjusted reimbursement rate for that scope-of-service change shall be made retroactive to the date the scope-of-service change was initially implemented. Scope-of-service changes under this paragraph shall be required to be submitted within the later of 150 days after the adoption and issuance of the written instructions by the department, or 150 days after the end of the FQHCs or RHCs fiscal year ending in 2003.
(7)All references in this subdivision to fiscal year shall be construed to be references to the fiscal year of the individual FQHC or RHC, as the case may be.
(f)(1)An FQHC or RHC may request a supplemental payment if extraordinary circumstances beyond the control of the FQHC or RHC occur after December 31, 2001, and PPS payments are insufficient due to these extraordinary circumstances. Supplemental payments arising from extraordinary circumstances under this subdivision shall be solely and exclusively within the discretion of the department and shall not be subject to subdivision (l). These supplemental payments shall be determined separately from the scope-of-service adjustments described in subdivision (e). Extraordinary circumstances include, but are not limited to, acts of nature, changes in applicable requirements in the Health and Safety Code, changes in applicable licensure requirements, and changes in applicable rules or regulations. Mere inflation of costs alone, absent extraordinary circumstances, shall not be grounds for supplemental payment. If an FQHCs or RHCs PPS rate is sufficient to cover its overall costs, including those associated with the extraordinary circumstances, then a supplemental payment is not warranted.
(2)The department shall accept requests for supplemental payment at any time throughout the prospective payment rate year.
(3)Requests for supplemental payments shall be submitted in writing to the department and shall set forth the reasons for the request. Each request shall be accompanied by sufficient documentation to enable the department to act upon the request. Documentation shall include the data necessary to demonstrate that the circumstances for which supplemental payment is requested meet the requirements set forth in this section. Documentation shall include both of the following:
(A)A presentation of data to demonstrate reasons for the FQHCs or RHCs request for a supplemental payment.
(B)Documentation showing the cost implications. The cost impact shall be material and significant, two hundred thousand dollars ($200,000) or 1 percent of a facilitys total costs, whichever is less.
(4)A request shall be submitted for each affected year.
(5)Amounts granted for supplemental payment requests shall be paid as lump-sum amounts for those years and not as revised PPS rates, and shall be repaid by the FQHC or RHC to the extent that it is not expended for the specified purposes.
(6)The department shall notify the provider of the departments discretionary decision in writing.
(g)(1)An FQHC or RHC visit means a face-to-face encounter between an FQHC or RHC patient and a physician, physician assistant, nurse practitioner, certified nurse-midwife, clinical psychologist, licensed clinical social worker, or a visiting nurse. For purposes of this section, physician shall be interpreted in a manner consistent with the Centers for Medicare and Medicaid Services Medicare Rural Health Clinic and Federally Qualified Health Center Manual (Publication 27), or its successor, only to the extent that it defines the professionals whose services are reimbursable on a per-visit basis and not as to the types of services that these professionals may render during these visits and shall include a physician and surgeon, osteopath, podiatrist, dentist, optometrist, and chiropractor. A visit shall also include a face-to-face encounter between an FQHC or RHC patient and a comprehensive perinatal practitioner, as defined in Section 51179.7 of Title 22 of the California Code of Regulations, providing comprehensive perinatal services, a four-hour day of attendance at an adult day health care center, and any other provider identified in the state plans definition of an FQHC or RHC visit.
(2)(A)A visit shall also include a face-to-face encounter between an FQHC or RHC patient and a dental hygienist, a dental hygienist in alternative practice, or a marriage and family therapist.
(B)Notwithstanding subdivision (e), if an FQHC or RHC that currently includes the cost of the services of a dental hygienist in alternative practice, or a marriage and family therapist for the purposes of establishing its FQHC or RHC rate chooses to bill these services as a separate visit, the FQHC or RHC shall apply for an adjustment to its per-visit rate, and, after the rate adjustment has been approved by the department, shall bill these services as a separate visit. However, multiple encounters with dental professionals or marriage and family therapists that take place on the same day shall constitute a single visit. The department shall develop the appropriate forms to determine which FQHCs or RHCs rates shall be adjusted and to facilitate the calculation of the adjusted rates. An FQHCs or RHCs application for, or the departments approval of, a rate adjustment pursuant to this subparagraph shall not constitute a change in scope of service within the meaning of subdivision (e). An FQHC or RHC that applies for an adjustment to its rate pursuant to this subparagraph may continue to bill for all other FQHC or RHC visits at its existing per-visit rate, subject to reconciliation, until the rate adjustment for visits between an FQHC or RHC patient and a dental hygienist, a dental hygienist in alternative practice, or a marriage and family therapist has been approved. Any approved increase or decrease in the providers rate shall be made within six months after the date of receipt of the departments rate adjustment forms pursuant to this subparagraph and shall be retroactive to the beginning of the fiscal year in which the FQHC or RHC submits the request, but in no case shall the effective date be earlier than January 1, 2008.
(C)An FQHC or RHC that does not provide dental hygienist, dental hygienist in alternative practice, or marriage and family therapist services, and later elects to add these services and bill these services as a separate visit, shall process the addition of these services as a change in scope of service pursuant to subdivision (e).
(h)If FQHC or RHC services are partially reimbursed by a third-party payer, such as a managed care entity (as defined in Section 1396u-2(a)(1)(B) of Title 42 of the United States Code), the Medicare Program, or the Child Health and Disability Prevention (CHDP) Program, the department shall reimburse an FQHC or RHC for the difference between its per-visit PPS rate and receipts from other plans or programs on a contract-by-contract basis and not in the aggregate, and may not include managed care financial incentive payments that are required by federal law to be excluded from the calculation.
(i)(1)An entity that first qualifies as an FQHC or RHC in the year 2001 or later, a newly licensed facility at a new location added to an existing FQHC or RHC, and any entity that is an existing FQHC or RHC that is relocated to a new site shall each have its reimbursement rate established in accordance with one of the following methods, as selected by the FQHC or RHC:
(A)The rate may be calculated on a per-visit basis in an amount that is equal to the average of the per-visit rates of three comparable FQHCs or RHCs located in the same or adjacent area with a similar caseload.
(B)In the absence of three comparable FQHCs or RHCs with a similar caseload, the rate may be calculated on a per-visit basis in an amount that is equal to the average of the per-visit rates of three comparable FQHCs or RHCs located in the same or an adjacent service area, or in a reasonably similar geographic area with respect to relevant social, health care, and economic characteristics.
(C)At a new entitys one-time election, the department shall establish a reimbursement rate, calculated on a per-visit basis, that is equal to 100 percent of the projected allowable costs to the FQHC or RHC of furnishing FQHC or RHC services during the first 12 months of operation as an FQHC or RHC. After the first 12-month period, the projected per-visit rate shall be increased by the Medicare Economic Index then in effect. The projected allowable costs for the first 12 months shall be cost settled and the prospective payment reimbursement rate shall be adjusted based on actual and allowable cost per visit.
(D)The department may adopt any further and additional methods of setting reimbursement rates for newly qualified FQHCs or RHCs as are consistent with Section 1396a(bb)(4) of Title 42 of the United States Code.
(2)In order for an FQHC or RHC to establish the comparability of its caseload for purposes of subparagraph (A) or (B) of paragraph (1), the department shall require that the FQHC or RHC submit its most recent annual utilization report as submitted to the Office of Statewide Health Planning and Development, unless the FQHC or RHC was not required to file an annual utilization report. FQHCs or RHCs that have experienced changes in their services or caseload subsequent to the filing of the annual utilization report may submit to the department a completed report in the format applicable to the prior calendar year. FQHCs or RHCs that have not previously submitted an annual utilization report shall submit to the department a completed report in the format applicable to the prior calendar year. The FQHC or RHC shall not be required to submit the annual utilization report for the comparable FQHCs or RHCs to the department, but shall be required to identify the comparable FQHCs or RHCs.
(3)The rate for any newly qualified entity set forth under this subdivision shall be effective retroactively to the later of the date that the entity was first qualified by the applicable federal agency as an FQHC or RHC, the date a new facility at a new location was added to an existing FQHC or RHC, or the date on which an existing FQHC or RHC was relocated to a new site. The FQHC or RHC shall be permitted to continue billing for Medi-Cal covered benefits on a fee-for-service basis under its existing provider number until it is informed of its FQHC or RHC enrollment approval, and the department shall reconcile the difference between the fee-for-service payments and the FQHCs or RHCs prospective payment rate at that time.
(j)Visits occurring at an intermittent clinic site, as defined in subdivision (h) of Section 1206 of the Health and Safety Code, of an existing FQHC or RHC, or in a mobile unit as defined by paragraph (2) of subdivision (b) of Section 1765.105 of the Health and Safety Code, shall be billed by and reimbursed at the same rate as the FQHC or RHC establishing the intermittent clinic site or the mobile unit, subject to the right of the FQHC or RHC to request a scope-of-service adjustment to the rate.
(k)(1)Notwithstanding any other provision of this section requiring the use of a per-visit reimbursement rate, as described in subdivision (c), this subdivision shall govern reimbursement for services identified in this subdivision.
(2)An FQHC or RHC may elect to have pharmacy services or dental services reimbursed on a fee-for-services basis, utilizing the current fee schedules established for those services.
(3)An FQHC or RHC may elect to enroll as a Drug Medi-Cal certified provider. If an FQHC or RHC elects to enroll as a Drug Medi-Cal certified provider, the costs associated with the Drug Medi-Cal services shall not be included in the FQHCs or RHCs per-visit PPS rate and the reimbursement for those services shall be governed by subparagraph (A) or (B).
(A)If the FQHC or RHC elects to provide Drug Medi-Cal services in a county that has elected to participate in the Drug Medi-Cal organized delivery system, the FQHC or RHC shall receive reimbursement pursuant to a mutually agreed upon contract between the county and the FQHC or RHC. If an FQHC or RHC is denied a contract by the county, the FQHC or RHC may follow the contract denial process set forth in the Special Terms and Conditions.
(B)If the FQHC or RHC elects to provide Drug Medi-Cal services in a county that does not elect to participate in the Drug Medi-Cal organized delivery system, the FQHC or RHC shall receive reimbursement pursuant to a mutually agreed upon contract between the county and the FQHC or RHC. If the county refuses to contract with the FQHC or RHC, the FQHC or RHC may request to contract directly with the department and shall be reimbursed for those services at the fee-for-service rate.
(4)(A)If an FQHC or RHC elects reimbursement pursuant to paragraph (2) or (3), pursuant to which the costs associated with providing the services are part of the FQHCs or RHCs clinic base rate, those costs shall be adjusted out of the FQHCs or RHCs clinic base rate as scope-of-service changes and payment pursuant to subdivision (h) shall not apply.
(B)An FQHC or RHC that reverses its election under paragraph (2) or (3) shall revert to its prior rate, subject to an increase to account for all Medicare Economic Index increases occurring during the intervening time period, and subject to any increases or decreases associated with applicable scope-of-service adjustments as provided in subdivision (e).
(5)(A)An FQHC or RHC shall submit a scope-of-service rate change request within 90 days of the beginning of any FQHC or RHC fiscal year occurring after January 1, 2017, if, during the FQHCs or RHCs prior fiscal year, both of the following occurred:
(i)The FQHC or RHC elected reimbursement pursuant to paragraph (3).
(ii)The costs of providing Drug Medi-Cal services were included in the per-visit PPS rate and the removal of those costs would have resulted in a significantly lower per-visit PPS rate. For purposes of this subparagraph, significantly lower means an average per-visit PPS rate decrease in excess of 2.5 percent.
(B)Within 90 days of receipt of the request for a scope-of-service change, the department shall issue the FQHC or RHC an interim rate equal to 90 percent of the FQHCs or RHCs projected allowable cost as determined by the department. The audit performed to determine the final rate shall be performed in accordance with Section 14170.
(6)If an FQHC or RHC makes an election pursuant to paragraph (3) and a scope-of-service change is necessary pursuant to paragraphs (4) and (5), the FQHC or RHC shall comply with both of the following:
(A)After the department approves the request for a scope-of-service change and adjusts the per-visit PPS rate pursuant to paragraph (4), the FQHC or RHC shall not bill the per-visit PPS rate for services reimbursed by the Drug Medi-Cal organized delivery system.
(B)For the purpose of calculating a per-visit PPS rate, the FQHC or RHC shall provide verifiable documentation of the costs of an employee who provides both FQHC services and Drug Medi-Cal services. Documentation shall attribute costs proportionally between FQHC services and Drug Medi-Cal services. Only the costs attributable to FQHC services shall be included in the per-visit PPS rate.
(7)If an FQHC or RHC was enrolled as a Drug Medi-Cal certified provider on or before January 1, 2017, the FQHC or RHC may continue to provide, and be reimbursed for, Drug Medi-Cal services pursuant to the terms of the contract if the costs of providing Drug Medi-Cal services are reimbursed outside of the per-visit PPS rate described in subdivision (c).
(8)(A)If an FQHC or RHC entered into a contract on or before January 1, 2017, with a mental health plan to provide specialty mental health services to Medi-Cal beneficiaries as part of the mental health plans network, the FQHC or RHC may continue to provide, and be reimbursed for, those specialty mental health services pursuant to the terms of the contract with the mental health plan if the costs of providing specialty mental health services are reimbursed outside of the per-visit PPS rate described in subdivision (c).
(B)For purposes of this paragraph, mental health plan means any mental health plan contracting with the department to provide specialty mental health services to enrolled Medi-Cal beneficiaries under Article 5 (commencing with Section 14680) of Chapter 8.8 or Chapter 8.9 (commencing with Section 14700).
(9)Nothing in this subdivision shall be construed to alter or otherwise change the process applicable to an FQHC or RHC making an election pursuant to paragraph (2).
(10)For purposes of this subdivision, the following definitions shall apply:
(A)Drug Medi-Cal organized delivery system means the Drug Medi-Cal organized delivery system authorized under the California Medi-Cal 2020 Demonstration, Number 11-W-00193/9, as approved by the federal Centers for Medicare and Medicaid Services and described in the Special Terms and Conditions.
(B)Special Terms and Conditions shall have the same meaning as set forth in subdivision (o) of Section 14184.10.
(l)FQHCs and RHCs may appeal a grievance or complaint concerning ratesetting, scope-of-service changes, and settlement of cost report audits, in the manner prescribed by Section 14171. The rights and remedies provided under this subdivision are cumulative to the rights and remedies available under all other provisions of law of this state.
(m)The department shall, no later than March 30, 2008, promptly seek all necessary federal approvals in order to implement this section, including any amendments to the state plan. To the extent that any element or requirement of this section is not approved, the department shall submit a request to the federal Centers for Medicare and Medicaid Services for any waivers that would be necessary to implement this section.
(n)The department shall implement this section only to the extent that federal financial participation is obtained.
SEC. 2.Section 1.5 of this bill incorporates amendments to Section 14132.100 of the Welfare and Institutions Code proposed by both this bill and Senate Bill 1335. It shall only become operative if (1) both bills are enacted and become effective on or before January 1, 2017, (2) each bill amends Section 14132.100 of the Welfare and Institutions Code, and (3) this bill is enacted after Senate Bill 1335, in which case Section 1 of this bill shall not become operative.
(a)The federally qualified health center services described in Section 1396d(a)(2)(C) of Title 42 of the United States Code are covered benefits.
(b)The rural health clinic services described in Section 1396d(a)(2)(B) of Title 42 of the United States Code are covered benefits.
(c)Federally qualified health center services and rural health clinic services shall be reimbursed on a per-visit basis in accordance with the definition of visit set forth in subdivision (g).
(d)Effective October 1, 2004, and on each October 1, 1 thereafter, until no longer required by federal law, federally qualified health center (FQHC) and rural health clinic (RHC) per-visit rates shall be increased by the Medicare Economic Index applicable to primary care services in the manner provided for in Section 1396a(bb)(3)(A) of Title 42 of the United States Code. Prior to January 1, 2004, FQHC and RHC per-visit rates shall be adjusted by the Medicare Economic Index in accordance with the methodology set forth in the state plan in effect on October 1, 2001.
(e)(1)An FQHC or RHC may apply for an adjustment to its per-visit rate based on a change in the scope of services provided by the FQHC or RHC. Rate changes based on a change in the scope of services provided by an FQHC or RHC shall be evaluated in accordance with Medicare reasonable cost principles, as set forth in Part 413 (commencing with Section 413.1) of Title 42 of the Code of Federal Regulations, or its successor.
(2)Subject to the conditions set forth in subparagraphs (A) to (D), inclusive, of paragraph (3), a change in scope of service means any of the following:
(A)The addition of a new FQHC or RHC service that is not incorporated in the baseline prospective payment system (PPS) rate, or a deletion of an FQHC or RHC service that is incorporated in the baseline PPS rate.
(B)A change in service due to amended regulatory requirements or rules.
(C)A change in service resulting from relocating or remodeling an FQHC or RHC.
(D)A change in types of services due to a change in applicable technology and medical practice utilized by the center or clinic.
(E)An increase in service intensity attributable to changes in the types of patients served, including, but not limited to, populations with HIV or AIDS, or other chronic diseases, or homeless, elderly, migrant, or other special populations.
(F)Any changes in any of the services described in subdivision (a) or (b), or in the provider mix of an FQHC or RHC or one of its sites.
(G)Changes in operating costs attributable to capital expenditures associated with a modification of the scope of any of the services described in subdivision (a) or (b), including new or expanded service facilities, regulatory compliance, or changes in technology or medical practices at the center or clinic.
(H)Indirect medical education adjustments and a direct graduate medical education payment that reflects the costs of providing teaching services to interns and residents.
(I)Any changes in the scope of a project approved by the federal Health Resources and Services Administration (HRSA).
(3)No change in costs shall, in and of itself, be considered a scope-of-service change unless all of the following apply:
(A)The increase or decrease in cost is attributable to an increase or decrease in the scope of services defined in subdivisions (a) and (b), as applicable.
(B)The cost is allowable under Medicare reasonable cost principles set forth in Part 413 (commencing with Section 413) of Subchapter B of Chapter 4 of Title 42 of the Code of Federal Regulations, or its successor.
(C)The change in the scope of services is a change in the type, intensity, duration, or amount of services, or any combination thereof.
(D)The net change in the FQHCs or RHCs rate equals or exceeds 1.75 percent for the affected FQHC or RHC site. For FQHCs and RHCs that filed consolidated cost reports for multiple sites to establish the initial prospective payment reimbursement rate, the 1.75-percent threshold shall be applied to the average per-visit rate of all sites for the purposes of calculating the cost associated with a scope-of-service change. Net change means the per-visit rate change attributable to the cumulative effect of all increases and decreases for a particular fiscal year.
(4)An FQHC or RHC may submit requests for scope-of-service changes once per fiscal year, only within 90 days following the beginning of the FQHCs or RHCs fiscal year. Any approved increase or decrease in the providers rate shall be retroactive to the beginning of the FQHCs or RHCs fiscal year in which the request is submitted.
(5)An FQHC or RHC shall submit a scope-of-service rate change request within 90 days of the beginning of any FQHC or RHC fiscal year occurring after the effective date of this section, if, during the FQHCs or RHCs prior fiscal year, the FQHC or RHC experienced a decrease in the scope of services provided that the FQHC or RHC either knew or should have known would have resulted in a significantly lower per-visit rate. If an FQHC or RHC discontinues providing onsite pharmacy or dental services, it shall submit a scope-of-service rate change request within 90 days of the beginning of the following fiscal year. The rate change shall be effective as provided for in paragraph (4). As used in this paragraph, significantly lower means an average per-visit rate decrease in excess of 2.5 percent.
(6)Notwithstanding paragraph (4), if the approved scope-of-service change or changes were initially implemented on or after the first day of an FQHCs or RHCs fiscal year ending in calendar year 2001, but before the adoption and issuance of written instructions for applying for a scope-of-service change, the adjusted reimbursement rate for that scope-of-service change shall be made retroactive to the date the scope-of-service change was initially implemented. Scope-of-service changes under this paragraph shall be required to be submitted within the later of 150 days after the adoption and issuance of the written instructions by the department, or 150 days after the end of the FQHCs or RHCs fiscal year ending in 2003.
(7)All references in this subdivision to fiscal year shall be construed to be references to the fiscal year of the individual FQHC or RHC, as the case may be.
(f)(1)An FQHC or RHC may request a supplemental payment if extraordinary circumstances beyond the control of the FQHC or RHC occur after December 31, 2001, and PPS payments are insufficient due to these extraordinary circumstances. Supplemental payments arising from extraordinary circumstances under this subdivision shall be solely and exclusively within the discretion of the department and shall not be subject to subdivision (l). These supplemental payments shall be determined separately from the scope-of-service adjustments described in subdivision (e). Extraordinary circumstances include, but are not limited to, acts of nature, changes in applicable requirements in the Health and Safety Code, changes in applicable licensure requirements, and changes in applicable rules or regulations. Mere inflation of costs alone, absent extraordinary circumstances, shall not be grounds for supplemental payment. If an FQHCs or RHCs PPS rate is sufficient to cover its overall costs, including those associated with the extraordinary circumstances, then a supplemental payment is not warranted.
(2)The department shall accept requests for supplemental payment at any time throughout the prospective payment rate year.
(3)Requests for supplemental payments shall be submitted in writing to the department and shall set forth the reasons for the request. Each request shall be accompanied by sufficient documentation to enable the department to act upon the request. Documentation shall include the data necessary to demonstrate that the circumstances for which supplemental payment is requested meet the requirements set forth in this section. Documentation shall include all both of the following:
(A)A presentation of data to demonstrate reasons for the FQHCs or RHCs request for a supplemental payment.
(B)Documentation showing the cost implications. The cost impact shall be material and significant, two hundred thousand dollars ($200,000) or 1 percent of a facilitys total costs, whichever is less.
(4)A request shall be submitted for each affected year.
(5)Amounts granted for supplemental payment requests shall be paid as lump-sum amounts for those years and not as revised PPS rates, and shall be repaid by the FQHC or RHC to the extent that it is not expended for the specified purposes.
(6)The department shall notify the provider of the departments discretionary decision in writing.
(g)(1)An FQHC or RHC visit means a face-to-face encounter between an FQHC or RHC patient and a physician, physician assistant, nurse practitioner, certified nurse-midwife, clinical psychologist, licensed clinical social worker, or a visiting nurse. For purposes of this section, physician shall be interpreted in a manner consistent with the Centers for Medicare and Medicaid Services Medicare Rural Health Clinic and Federally Qualified Health Center Manual (Publication 27), or its successor, only to the extent that it defines the professionals whose services are reimbursable on a per-visit basis and not as to the types of services that these professionals may render during these visits and shall include a physician and surgeon, osteopath, podiatrist, dentist, optometrist, and chiropractor. A visit shall also include a face-to-face encounter between an FQHC or RHC patient and a comprehensive perinatal practitioner, as defined in Section 51179.7 of Title 22 of the California Code of Regulations, providing comprehensive perinatal services, a four-hour day of attendance at an adult day health care center, and any other provider identified in the state plans definition of an FQHC or RHC visit.
(2)(A)A visit shall also include a face-to-face encounter between an FQHC or RHC patient and a dental hygienist, a dental hygienist in alternative practice, or a marriage and family therapist.
(B)Notwithstanding subdivision (e), if an FQHC or RHC that currently includes the cost of the services of a dental hygienist in alternative practice, or a marriage and family therapist for the purposes of establishing its FQHC or RHC rate chooses to bill these services as a separate visit, the FQHC or RHC shall apply for an adjustment to its per-visit rate, and, after the rate adjustment has been approved by the department, shall bill these services as a separate visit. However, multiple encounters with dental professionals or marriage and family therapists that take place on the same day shall constitute a single visit. The department shall develop the appropriate forms to determine which FQHCs or RHCs rates shall be adjusted and to facilitate the calculation of the adjusted rates. An FQHCs or RHCs application for, or the departments approval of, a rate adjustment pursuant to this subparagraph shall not constitute a change in scope of service within the meaning of subdivision (e). An FQHC or RHC that applies for an adjustment to its rate pursuant to this subparagraph may continue to bill for all other FQHC or RHC visits at its existing per-visit rate, subject to reconciliation, until the rate adjustment for visits between an FQHC or RHC patient and a dental hygienist, a dental hygienist in alternative practice, or a marriage and family therapist has been approved. Any approved increase or decrease in the providers rate shall be made within six months after the date of receipt of the departments rate adjustment forms pursuant to this subparagraph and shall be retroactive to the beginning of the fiscal year in which the FQHC or RHC submits the request, but in no case shall the effective date be earlier than January 1, 2008.
(C)An FQHC or RHC that does not provide dental hygienist, dental hygienist in alternative practice, or marriage and family therapist services, and later elects to add these services and bill these services as a separate visit, shall process the addition of these services as a change in scope of service pursuant to subdivision (e).
(h)If FQHC or RHC services are partially reimbursed by a third-party payer, such as a managed care entity (as defined in Section 1396u-2(a)(1)(B) of Title 42 of the United States Code), the Medicare Program, or the Child Health and Disability Prevention (CHDP) program, Program, the department shall reimburse an FQHC or RHC for the difference between its per-visit PPS rate and receipts from other plans or programs on a contract-by-contract basis and not in the aggregate, and may not include managed care financial incentive payments that are required by federal law to be excluded from the calculation.
(i)(1)An entity that first qualifies as an FQHC or RHC in the year 2001 or later, a newly licensed facility at a new location added to an existing FQHC or RHC, and any entity that is an existing FQHC or RHC that is relocated to a new site shall each have its reimbursement rate established in accordance with one of the following methods, as selected by the FQHC or RHC:
(A)The rate may be calculated on a per-visit basis in an amount that is equal to the average of the per-visit rates of three comparable FQHCs or RHCs located in the same or adjacent area with a similar caseload.
(B)In the absence of three comparable FQHCs or RHCs with a similar caseload, the rate may be calculated on a per-visit basis in an amount that is equal to the average of the per-visit rates of three comparable FQHCs or RHCs located in the same or an adjacent service area, or in a reasonably similar geographic area with respect to relevant social, health care, and economic characteristics.
(C)At a new entitys one-time election, the department shall establish a reimbursement rate, calculated on a per-visit basis, that is equal to 100 percent of the projected allowable costs to the FQHC or RHC of furnishing FQHC or RHC services during the first 12 months of operation as an FQHC or RHC. After the first 12-month period, the projected per-visit rate shall be increased by the Medicare Economic Index then in effect. The projected allowable costs for the first 12 months shall be cost settled and the prospective payment reimbursement rate shall be adjusted based on actual and allowable cost per visit.
(D)The department may adopt any further and additional methods of setting reimbursement rates for newly qualified FQHCs or RHCs as are consistent with Section 1396a(bb)(4) of Title 42 of the United States Code.
(2)In order for an FQHC or RHC to establish the comparability of its caseload for purposes of subparagraph (A) or (B) of paragraph (1), the department shall require that the FQHC or RHC submit its most recent annual utilization report as submitted to the Office of Statewide Health Planning and Development, unless the FQHC or RHC was not required to file an annual utilization report. FQHCs or RHCs that have experienced changes in their services or caseload subsequent to the filing of the annual utilization report may submit to the department a completed report in the format applicable to the prior calendar year. FQHCs or RHCs that have not previously submitted an annual utilization report shall submit to the department a completed report in the format applicable to the prior calendar year. The FQHC or RHC shall not be required to submit the annual utilization report for the comparable FQHCs or RHCs to the department, but shall be required to identify the comparable FQHCs or RHCs.
(3)The rate for any newly qualified entity set forth under this subdivision shall be effective retroactively to the later of the date that the entity was first qualified by the applicable federal agency as an FQHC or RHC, the date a new facility at a new location was added to an existing FQHC or RHC, or the date on which an existing FQHC or RHC was relocated to a new site. The FQHC or RHC shall be permitted to continue billing for Medi-Cal covered benefits on a fee-for-service basis under its existing provider number until it is informed of its FQHC or RHC enrollment approval, and the department shall reconcile the difference between the fee-for-service payments and the FQHCs or RHCs prospective payment rate at that time.
(j)Visits occurring at an intermittent clinic site, as defined in subdivision (h) of Section 1206 of the Health and Safety Code, of an existing FQHC or RHC, or in a mobile unit as defined by paragraph (2) of subdivision (b) of Section 1765.105 of the Health and Safety Code, shall be billed by and reimbursed at the same rate as the FQHC or RHC establishing the intermittent clinic site or the mobile unit, subject to the right of the FQHC or RHC to request a scope-of-service adjustment to the rate.
(k)An FQHC or RHC may elect to have pharmacy or dental services reimbursed on a fee-for-service basis, utilizing the current fee schedules established for those services. These costs shall be adjusted out of the FQHCs or RHCs clinic base rate as scope-of-service changes. An FQHC or RHC that reverses its election under this subdivision shall revert to its prior rate, subject to an increase to account for all Medicare Economic Index increases occurring during the intervening time period, and subject to any increase or decrease associated with applicable scope-of-service adjustments as provided in subdivision (e).
(l)FQHCs and RHCs may appeal a grievance or complaint concerning ratesetting, scope-of-service changes, and settlement of cost report audits, in the manner prescribed by Section 14171. The rights and remedies provided under this subdivision are cumulative to the rights and remedies available under all other provisions of law of this state.
(m)The department shall, no later than March 30, 2008, promptly seek all necessary federal approvals in order to implement this section, including any amendments to the state plan. To the extent that any element or requirement of this section is not approved, the department shall submit a request to the federal Centers for Medicare and Medicaid Services for any waivers that would be necessary to implement this section.
(n)The department shall implement this section only to the extent that federal financial participation is obtained.
SEC. 1.5.Section 14132.100 of the Welfare and Institutions Code is amended to read:14132.100.(a)The federally qualified health center services described in Section 1396d(a)(2)(C) of Title 42 of the United States Code are covered benefits.
(b)The rural health clinic services described in Section 1396d(a)(2)(B) of Title 42 of the United States Code are covered benefits.
(c)Federally qualified health center services and rural health clinic services shall be reimbursed on a per-visit basis in accordance with the definition of visit set forth in subdivision (g).
(d)Effective October 1, 2004, and on each October 1, 1 thereafter, until no longer required by federal law, federally qualified health center (FQHC) and rural health clinic (RHC) per-visit rates shall be increased by the Medicare Economic Index applicable to primary care services in the manner provided for in Section 1396a(bb)(3)(A) of Title 42 of the United States Code. Prior to January 1, 2004, FQHC and RHC per-visit rates shall be adjusted by the Medicare Economic Index in accordance with the methodology set forth in the state plan in effect on October 1, 2001.
(e)(1)An FQHC or RHC may apply for an adjustment to its per-visit rate based on a change in the scope of services provided by the FQHC or RHC. Rate changes based on a change in the scope of services provided by an FQHC or RHC shall be evaluated in accordance with Medicare reasonable cost principles, as set forth in Part 413 (commencing with Section 413.1) of Title 42 of the Code of Federal Regulations, or its successor.
(2)Subject to the conditions set forth in subparagraphs (A) to (D), inclusive, of paragraph (3), a change in scope of service means any of the following:
(A)The addition of a new FQHC or RHC service that is not incorporated in the baseline prospective payment system (PPS) rate, or a deletion of an FQHC or RHC service that is incorporated in the baseline PPS rate.
(B)A change in service due to amended regulatory requirements or rules.
(C)A change in service resulting from relocating or remodeling an FQHC or RHC.
(D)A change in types of services due to a change in applicable technology and medical practice utilized by the center or clinic.
(E)An increase in service intensity attributable to changes in the types of patients served, including, but not limited to, populations with HIV or AIDS, or other chronic diseases, or homeless, elderly, migrant, or other special populations.
(F)Any changes in any of the services described in subdivision (a) or (b), or in the provider mix of an FQHC or RHC or one of its sites.
(G)Changes in operating costs attributable to capital expenditures associated with a modification of the scope of any of the services described in subdivision (a) or (b), including new or expanded service facilities, regulatory compliance, or changes in technology or medical practices at the center or clinic.
(H)Indirect medical education adjustments and a direct graduate medical education payment that reflects the costs of providing teaching services to interns and residents.
(I)Any changes in the scope of a project approved by the federal Health Resources and Service Services Administration (HRSA).
(3)No change in costs shall, in and of itself, be considered a scope-of-service change unless all of the following apply:
(A)The increase or decrease in cost is attributable to an increase or decrease in the scope of services defined in subdivisions (a) and (b), as applicable.
(B)The cost is allowable under Medicare reasonable cost principles set forth in Part 413 (commencing with Section 413) of Subchapter B of Chapter 4 of Title 42 of the Code of Federal Regulations, or its successor.
(C)The change in the scope of services is a change in the type, intensity, duration, or amount of services, or any combination thereof.
(D)The net change in the FQHCs or RHCs rate equals or exceeds 1.75 percent for the affected FQHC or RHC site. For FQHCs and RHCs that filed consolidated cost reports for multiple sites to establish the initial prospective payment reimbursement rate, the 1.75-percent threshold shall be applied to the average per-visit rate of all sites for the purposes of calculating the cost associated with a scope-of-service change. Net change means the per-visit rate change attributable to the cumulative effect of all increases and decreases for a particular fiscal year.
(4)An FQHC or RHC may submit requests for scope-of-service changes once per fiscal year, only within 90 days following the beginning of the FQHCs or RHCs fiscal year. Any approved increase or decrease in the providers rate shall be retroactive to the beginning of the FQHCs or RHCs fiscal year in which the request is submitted.
(5)An FQHC or RHC shall submit a scope-of-service rate change request within 90 days of the beginning of any FQHC or RHC fiscal year occurring after the effective date of this section, if, during the FQHCs or RHCs prior fiscal year, the FQHC or RHC experienced a decrease in the scope of services provided that the FQHC or RHC either knew or should have known would have resulted in a significantly lower per-visit rate. If an FQHC or RHC discontinues providing onsite pharmacy or dental services, it shall submit a scope-of-service rate change request within 90 days of the beginning of the following fiscal year. The rate change shall be effective as provided for in paragraph (4). As used in this paragraph, significantly lower means an average per-visit rate decrease in excess of 2.5 percent.
(6)Notwithstanding paragraph (4), if the approved scope-of-service change or changes were initially implemented on or after the first day of an FQHCs or RHCs fiscal year ending in calendar year 2001, but before the adoption and issuance of written instructions for applying for a scope-of-service change, the adjusted reimbursement rate for that scope-of-service change shall be made retroactive to the date the scope-of-service change was initially implemented. Scope-of-service changes under this paragraph shall be required to be submitted within the later of 150 days after the adoption and issuance of the written instructions by the department, or 150 days after the end of the FQHCs or RHCs fiscal year ending in 2003.
(7)All references in this subdivision to fiscal year shall be construed to be references to the fiscal year of the individual FQHC or RHC, as the case may be.
(f)(1)An FQHC or RHC may request a supplemental payment if extraordinary circumstances beyond the control of the FQHC or RHC occur after December 31, 2001, and PPS payments are insufficient due to these extraordinary circumstances. Supplemental payments arising from extraordinary circumstances under this subdivision shall be solely and exclusively within the discretion of the department and shall not be subject to subdivision (l). These supplemental payments shall be determined separately from the scope-of-service adjustments described in subdivision (e). Extraordinary circumstances include, but are not limited to, acts of nature, changes in applicable requirements in the Health and Safety Code, changes in applicable licensure requirements, and changes in applicable rules or regulations. Mere inflation of costs alone, absent extraordinary circumstances, shall not be grounds for supplemental payment. If an FQHCs or RHCs PPS rate is sufficient to cover its overall costs, including those associated with the extraordinary circumstances, then a supplemental payment is not warranted.
(2)The department shall accept requests for supplemental payment at any time throughout the prospective payment rate year.
(3)Requests for supplemental payments shall be submitted in writing to the department and shall set forth the reasons for the request. Each request shall be accompanied by sufficient documentation to enable the department to act upon the request. Documentation shall include the data necessary to demonstrate that the circumstances for which supplemental payment is requested meet the requirements set forth in this section. Documentation shall include all both of the following:
(A)A presentation of data to demonstrate reasons for the FQHCs or RHCs request for a supplemental payment.
(B)Documentation showing the cost implications. The cost impact shall be material and significant, two hundred thousand dollars ($200,000) or 1 percent of a facilitys total costs, whichever is less.
(4)A request shall be submitted for each affected year.
(5)Amounts granted for supplemental payment requests shall be paid as lump-sum amounts for those years and not as revised PPS rates, and shall be repaid by the FQHC or RHC to the extent that it is not expended for the specified purposes.
(6)The department shall notify the provider of the departments discretionary decision in writing.
(g)(1)An FQHC or RHC visit means a face-to-face encounter between an FQHC or RHC patient and a physician, physician assistant, nurse practitioner, certified nurse-midwife, clinical psychologist, licensed clinical social worker, or a visiting nurse. For purposes of this section, physician shall be interpreted in a manner consistent with the Centers for Medicare and Medicaid Services Medicare Rural Health Clinic and Federally Qualified Health Center Manual (Publication 27), or its successor, only to the extent that it defines the professionals whose services are reimbursable on a per-visit basis and not as to the types of services that these professionals may render during these visits and shall include a physician and surgeon, osteopath, podiatrist, dentist, optometrist, and chiropractor. A visit shall also include a face-to-face encounter between an FQHC or RHC patient and a comprehensive perinatal services practitioner, as defined in Section 51179.1 51179.7 of Title 22 of the California Code of Regulations, providing comprehensive perinatal services, a four-hour day of attendance at an adult day health care center, and any other provider identified in the state plans definition of an FQHC or RHC visit.
(2)(A)A visit shall also include a face-to-face encounter between an FQHC or RHC patient and a dental hygienist or hygienist, a dental hygienist in alternative practice. practice, or a marriage and family therapist.
(B)Notwithstanding subdivision (e), if an FQHC or RHC that currently includes the cost of the services of a dental hygienist in alternative practice practice, or a marriage and family therapist for the purposes of establishing its FQHC or RHC rate chooses to bill these services as a separate visit, the FQHC or RHC shall apply for an adjustment to its per-visit rate, and, after the rate adjustment has been approved by the department, shall bill these services as a separate visit. However, multiple encounters with dental professionals or marriage and family therapists that take place on the same day shall constitute a single visit. The department shall develop the appropriate forms to determine which FQHCs or RHC RHCs rates shall be adjusted and to facilitate the calculation of the adjusted rates. An FQHCs or RHCs application for, or the departments approval of, a rate adjustment pursuant to this subparagraph shall not constitute a change in scope of service within the meaning of subdivision (e). An FQHC or RHC that applies for an adjustment to its rate pursuant to this subparagraph may continue to bill for all other FQHC or RHC visits at its existing per-visit rate, subject to reconciliation, until the rate adjustment for visits between an FQHC or RHC patient and a dental hygienist or hygienist, a dental hygienist in alternative practice practice, or a marriage and family therapist has been approved. Any approved increase or decrease in the providers rate shall be made within six months after the date of receipt of the departments rate adjustment forms pursuant to this subparagraph and shall be retroactive to the beginning of the fiscal year in which the FQHC or RHC submits the request, but in no case shall the effective date be earlier than January 1, 2008.
(C)An FQHC or RHC that does not provide dental hygienist or hygienist, dental hygienist in alternative practice practice, or marriage and family therapist services, and later elects to add these services, services and bill these services as a separate visit, shall process the addition of these services as a change in scope of service pursuant to subdivision (e).
(h)If FQHC or RHC services are partially reimbursed by a third-party payer, such as a managed care entity (as defined in Section 1396u-2(a)(1)(B) of Title 42 of the United States Code), the Medicare Program, or the Child Health and Disability Prevention (CHDP) program, Program, the department shall reimburse an FQHC or RHC for the difference between its per-visit PPS rate and receipts from other plans or programs on a contract-by-contract basis and not in the aggregate, and may not include managed care financial incentive payments that are required by federal law to be excluded from the calculation.
(i)(1)An entity that first qualifies as an FQHC or RHC in the year 2001 or later, a newly licensed facility at a new location added to an existing FQHC or RHC, and any entity that is an existing FQHC or RHC that is relocated to a new site shall each have its reimbursement rate established in accordance with one of the following methods, as selected by the FQHC or RHC:
(A)The rate may be calculated on a per-visit basis in an amount that is equal to the average of the per-visit rates of three comparable FQHCs or RHCs located in the same or adjacent area with a similar caseload.
(B)In the absence of three comparable FQHCs or RHCs with a similar caseload, the rate may be calculated on a per-visit basis in an amount that is equal to the average of the per-visit rates of three comparable FQHCs or RHCs located in the same or an adjacent service area, or in a reasonably similar geographic area with respect to relevant social, health care, and economic characteristics.
(C)At a new entitys one-time election, the department shall establish a reimbursement rate, calculated on a per-visit basis, that is equal to 100 percent of the projected allowable costs to the FQHC or RHC of furnishing FQHC or RHC services during the first 12 months of operation as an FQHC or RHC. After the first 12-month period, the projected per-visit rate shall be increased by the Medicare Economic Index then in effect. The projected allowable costs for the first 12 months shall be cost settled and the prospective payment reimbursement rate shall be adjusted based on actual and allowable cost per visit.
(D)The department may adopt any further and additional methods of setting reimbursement rates for newly qualified FQHCs or RHCs as are consistent with Section 1396a(bb)(4) of Title 42 of the United States Code.
(2)In order for an FQHC or RHC to establish the comparability of its caseload for purposes of subparagraph (A) or (B) of paragraph (1), the department shall require that the FQHC or RHC submit its most recent annual utilization report as submitted to the Office of Statewide Health Planning and Development, unless the FQHC or RHC was not required to file an annual utilization report. FQHCs or RHCs that have experienced changes in their services or caseload subsequent to the filing of the annual utilization report may submit to the department a completed report in the format applicable to the prior calendar year. FQHCs or RHCs that have not previously submitted an annual utilization report shall submit to the department a completed report in the format applicable to the prior calendar year. The FQHC or RHC shall not be required to submit the annual utilization report for the comparable FQHCs or RHCs to the department, but shall be required to identify the comparable FQHCs or RHCs.
(3)The rate for any newly qualified entity set forth under this subdivision shall be effective retroactively to the later of the date that the entity was first qualified by the applicable federal agency as an FQHC or RHC, the date a new facility at a new location was added to an existing FQHC or RHC, or the date on which an existing FQHC or RHC was relocated to a new site. The FQHC or RHC shall be permitted to continue billing for Medi-Cal covered benefits on a fee-for-service basis under its existing provider number until it is informed of its enrollment as an FQHC or RHC, RHC enrollment approval, and the department shall reconcile the difference between the fee-for-service payments and the FQHCs or RHCs prospective payment rate at that time.
(j)Visits occurring at an intermittent clinic site, as defined in subdivision (h) of Section 1206 of the Health and Safety Code, of an existing FQHC or RHC, or in a mobile unit as defined by paragraph (2) of subdivision (b) of Section 1765.105 of the Health and Safety Code, shall be billed by and reimbursed at the same rate as the FQHC or RHC establishing the intermittent clinic site or the mobile unit, subject to the right of the FQHC or RHC to request a scope-of-service adjustment to the rate.
(k)(1)Notwithstanding any other provision of this section requiring the use of a per-visit reimbursement rate, as described in subdivision (c), this subdivision shall govern reimbursement for services identified in this subdivision.
(2)An FQHC or RHC may elect to have pharmacy services or dental services reimbursed on a fee-for-services basis, utilizing the current fee schedules established for those services.
(3)An FQHC or RHC may elect to enroll as a Drug Medi-Cal certified provider. If an FQHC or RHC elects to enroll as a Drug Medi-Cal certified provider, the costs associated with the Drug Medi-Cal services shall not be included in the FQHCs or RHCs per-visit PPS rate and the reimbursement for those services shall be governed by subparagraph (A) or (B).
(A)If the FQHC or RHC elects to provide Drug Medi-Cal services in a county that has elected to participate in the Drug Medi-Cal organized delivery system, the FQHC or RHC shall receive reimbursement pursuant to a mutually agreed upon contract between the county and the FQHC or RHC. If an FQHC or RHC is denied a contract by the county, the FQHC or RHC may follow the contract denial process set forth in the Special Terms and Conditions.
(B)If the FQHC or RHC elects to provide Drug Medi-Cal services in a county that does not elect to participate in the Drug Medi-Cal organized delivery system, the FQHC or RHC shall receive reimbursement pursuant to a mutually agreed upon contract between the county and the FQHC or RHC. If the county refuses to contract with the FQHC or RHC, the FQHC or RHC may request to contract directly with the department and shall be reimbursed for those services at the fee-for-service rate.
(4)(A)If an FQHC or RHC elects reimbursement pursuant to paragraph (2) or (3), pursuant to which the costs associated with providing the services are part of the FQHCs or RHCs clinic base rate, those costs shall be adjusted out of the FQHCs or RHCs clinic base rate as scope-of-service changes and payment pursuant to subdivision (h) shall not apply.
(k)
(B)An FQHC or RHC may elect to have pharmacy or dental services reimbursed on a fee-for-service basis, utilizing the current fee schedules established for those services. These costs shall be adjusted out of the FQHCs or RHCs clinic base rate as scope-of-service changes. An FQHC or RHC that reverses its election under this subdivision paragraph (2) or (3) shall revert to its prior rate, subject to an increase to account for all MEI Medicare Economic Index increases occurring during the intervening time period, and subject to any increase or decrease increases or decreases associated with applicable scope-of-services scope-of-service adjustments as provided in subdivision (e).
(5)(A)An FQHC or RHC shall submit a scope-of-service rate change request within 90 days of the beginning of any FQHC or RHC fiscal year occurring after January 1, 2017, if, during the FQHCs or RHCs prior fiscal year, both of the following occurred:
(i)The FQHC or RHC elected reimbursement pursuant to paragraph (3).
(ii)The costs of providing Drug Medi-Cal services were included in the per-visit PPS rate and the removal of those costs would have resulted in a significantly lower per-visit PPS rate. For purposes of this subparagraph, significantly lower means an average per-visit PPS rate decrease in excess of 2.5 percent.
(B)Within 90 days of receipt of the request for a scope-of-service change, the department shall issue the FQHC or RHC an interim rate equal to 90 percent of the FQHCs or RHCs projected allowable cost as determined by the department. The audit performed to determine the final rate shall be performed in accordance with Section 14170.
(6)If an FQHC or RHC makes an election pursuant to paragraph (3) and a scope-of-service change is necessary pursuant to paragraphs (4) and (5), the FQHC or RHC shall comply with both of the following:
(A)After the department approves the request for a scope-of-service change and adjusts the per-visit PPS rate pursuant to paragraph (4), the FQHC or RHC shall not bill the per-visit PPS rate for services reimbursed by the Drug Medi-Cal organized delivery system.
(B)For the purpose of calculating a per-visit PPS rate, the FQHC or RHC shall provide verifiable documentation of the costs of an employee who provides both FQHC services and Drug Medi-Cal services. Documentation shall attribute costs proportionally between FQHC services and Drug Medi-Cal services. Only the costs attributable to FQHC services shall be included in the per-visit PPS rate.
(7)If an FQHC or RHC was enrolled as a Drug Medi-Cal certified provider on or before January 1, 2017, the FQHC or RHC may continue to provide, and be reimbursed for, Drug Medi-Cal services pursuant to the terms of the contract if the costs of providing Drug Medi-Cal services are reimbursed outside of the per-visit PPS rate described in subdivision (c).
(8)(A)If an FQHC or RHC entered into a contract on or before January 1, 2017, with a mental health plan to provide specialty mental health services to Medi-Cal beneficiaries as part of the mental health plans network, the FQHC or RHC may continue to provide, and be reimbursed for, those specialty mental health services pursuant to the terms of the contract with the mental health plan if the costs of providing specialty mental health services are reimbursed outside of the per-visit PPS rate described in subdivision (c).
(B)For purposes of this paragraph, mental health plan means any mental health plan contracting with the department to provide specialty mental health services to enrolled Medi-Cal beneficiaries under Article 5 (commencing with Section 14680) of Chapter 8.8 or Chapter 8.9 (commencing with Section 14700).
(9)Nothing in this subdivision shall be construed to alter or otherwise change the process applicable to an FQHC or RHC making an election pursuant to paragraph (2).
(10)For purposes of this subdivision, the following definitions shall apply:
(A)Drug Medi-Cal organized delivery system means the Drug Medi-Cal organized delivery system authorized under the California Medi-Cal 2020 Demonstration, Number 11-W-00193/9, as approved by the federal Centers for Medicare and Medicaid Services and described in the Special Terms and Conditions.
(B)Special Terms and Conditions shall have the same meaning as set forth in subdivision (o) of Section 14184.10.
(l)FQHCs and RHCs may appeal a grievance or complaint concerning ratesetting, scope-of-service changes, and settlement of cost report audits, in the manner prescribed by Section 14171. The rights and remedies provided under this subdivision are cumulative to the rights and remedies available under all other provisions of law of this state.
(m)The department shall, by no later than March 30, 2008, promptly seek all necessary federal approvals in order to implement this section, including any amendments to the state plan. To the extent that any element or requirement of this section is not approved, the department shall submit a request to the federal Centers for Medicare and Medicaid Services for any waivers that would be necessary to implement this section.
(n)The department shall implement this section only to the extent that federal financial participation is obtained.
SEC. 2.Section 1.5 of this bill incorporates amendments to Section 14132.100 of the Welfare and Institutions Code proposed by both this bill and Senate Bill 1335. It shall only become operative if (1) both bills are enacted and become effective on or before January 1, 2017, (2) each bill amends Section 14132.100 of the Welfare and Institutions Code, and (3) this bill is enacted after Senate Bill 1335, in which case Section 1 of this bill shall not become operative.
(a)The federally qualified health center services described in Section 1396d(a)(2)(C) of Title 42 of the United States Code are covered benefits.
(b)The rural health clinic services described in Section 1396d(a)(2)(B) of Title 42 of the United States Code are covered benefits.
(c)Federally qualified health center services and rural health clinic services shall be reimbursed on a per-visit basis in accordance with the definition of visit set forth in subdivision (g).
(d)Effective October 1, 2004, and on each October 1, thereafter, until no longer required by federal law, federally qualified health center (FQHC) and rural health clinic (RHC) per-visit rates shall be increased by the Medicare Economic Index applicable to primary care services in the manner provided for in Section 1396a(bb)(3)(A) of Title 42 of the United States Code. Prior to January 1, 2004, FQHC and RHC per-visit rates shall be adjusted by the Medicare Economic Index in accordance with the methodology set forth in the state plan in effect on October 1, 2001.
(e)(1)An FQHC or RHC may apply for an adjustment to its per-visit rate based on a change in the scope of services provided by the FQHC or RHC. Rate changes based on a change in the scope of services provided by an FQHC or RHC shall be evaluated in accordance with Medicare reasonable cost principles, as set forth in Part 413 (commencing with Section 413.1) of Title 42 of the Code of Federal Regulations, or its successor.
(2)Subject to the conditions set forth in subparagraphs (A) to (D), inclusive, of paragraph (3), a change in scope of service means any of the following:
(A)The addition of a new FQHC or RHC service that is not incorporated in the baseline prospective payment system (PPS) rate, or a deletion of an FQHC or RHC service that is incorporated in the baseline PPS rate.
(B)A change in service due to amended regulatory requirements or rules.
(C)A change in service resulting from relocating or remodeling an FQHC or RHC.
(D)A change in types of services due to a change in applicable technology and medical practice utilized by the center or clinic.
(E)An increase in service intensity attributable to changes in the types of patients served, including, but not limited to, populations with HIV or AIDS, or other chronic diseases, or homeless, elderly, migrant, or other special populations.
(F)Any changes in any of the services described in subdivision (a) or (b), or in the provider mix of an FQHC or RHC or one of its sites.
(G)Changes in operating costs attributable to capital expenditures associated with a modification of the scope of any of the services described in subdivision (a) or (b), including new or expanded service facilities, regulatory compliance, or changes in technology or medical practices at the center or clinic.
(H)Indirect medical education adjustments and a direct graduate medical education payment that reflects the costs of providing teaching services to interns and residents.
(I)Any changes in the scope of a project approved by the federal Health Resources and Services Administration (HRSA).
(3)No change in costs shall, in and of itself, be considered a scope-of-service change unless all of the following apply:
(A)The increase or decrease in cost is attributable to an increase or decrease in the scope of services defined in subdivisions (a) and (b), as applicable.
(B)The cost is allowable under Medicare reasonable cost principles set forth in Part 413 (commencing with Section 413) of Subchapter B of Chapter 4 of Title 42 of the Code of Federal Regulations, or its successor.
(C)The change in the scope of services is a change in the type, intensity, duration, or amount of services, or any combination thereof.
(D)The net change in the FQHCs or RHCs rate equals or exceeds 1.75 percent for the affected FQHC or RHC site. For FQHCs and RHCs that filed consolidated cost reports for multiple sites to establish the initial prospective payment reimbursement rate, the 1.75-percent threshold shall be applied to the average per-visit rate of all sites for the purposes of calculating the cost associated with a scope-of-service change. Net change means the per-visit rate change attributable to the cumulative effect of all increases and decreases for a particular fiscal year.
(4)An FQHC or RHC may submit requests for scope-of-service changes once per fiscal year, only within 90 days following the beginning of the FQHCs or RHCs fiscal year. Any approved increase or decrease in the providers rate shall be retroactive to the beginning of the FQHCs or RHCs fiscal year in which the request is submitted.
(5)An FQHC or RHC shall submit a scope-of-service rate change request within 90 days of the beginning of any FQHC or RHC fiscal year occurring after the effective date of this section, if, during the FQHCs or RHCs prior fiscal year, the FQHC or RHC experienced a decrease in the scope of services provided that the FQHC or RHC either knew or should have known would have resulted in a significantly lower per-visit rate. If an FQHC or RHC discontinues providing onsite pharmacy or dental services, it shall submit a scope-of-service rate change request within 90 days of the beginning of the following fiscal year. The rate change shall be effective as provided for in paragraph (4). As used in this paragraph, significantly lower means an average per-visit rate decrease in excess of 2.5 percent.
(6)Notwithstanding paragraph (4), if the approved scope-of-service change or changes were initially implemented on or after the first day of an FQHCs or RHCs fiscal year ending in calendar year 2001, but before the adoption and issuance of written instructions for applying for a scope-of-service change, the adjusted reimbursement rate for that scope-of-service change shall be made retroactive to the date the scope-of-service change was initially implemented. Scope-of-service changes under this paragraph shall be required to be submitted within the later of 150 days after the adoption and issuance of the written instructions by the department, or 150 days after the end of the FQHCs or RHCs fiscal year ending in 2003.
(7)All references in this subdivision to fiscal year shall be construed to be references to the fiscal year of the individual FQHC or RHC, as the case may be.
(f)(1)An FQHC or RHC may request a supplemental payment if extraordinary circumstances beyond the control of the FQHC or RHC occur after December 31, 2001, and PPS payments are insufficient due to these extraordinary circumstances. Supplemental payments arising from extraordinary circumstances under this subdivision shall be solely and exclusively within the discretion of the department and shall not be subject to subdivision (l). These supplemental payments shall be determined separately from the scope-of-service adjustments described in subdivision (e). Extraordinary circumstances include, but are not limited to, acts of nature, changes in applicable requirements in the Health and Safety Code, changes in applicable licensure requirements, and changes in applicable rules or regulations. Mere inflation of costs alone, absent extraordinary circumstances, shall not be grounds for supplemental payment. If an FQHCs or RHCs PPS rate is sufficient to cover its overall costs, including those associated with the extraordinary circumstances, then a supplemental payment is not warranted.
(2)The department shall accept requests for supplemental payment at any time throughout the prospective payment rate year.
(3)Requests for supplemental payments shall be submitted in writing to the department and shall set forth the reasons for the request. Each request shall be accompanied by sufficient documentation to enable the department to act upon the request. Documentation shall include the data necessary to demonstrate that the circumstances for which supplemental payment is requested meet the requirements set forth in this section. Documentation shall include all of the following:
(A)A presentation of data to demonstrate reasons for the FQHCs or RHCs request for a supplemental payment.
(B)Documentation showing the cost implications. The cost impact shall be material and significant, two hundred thousand dollars ($200,000) or 1 percent of a facilitys total costs, whichever is less.
(4)A request shall be submitted for each affected year.
(5)Amounts granted for supplemental payment requests shall be paid as lump-sum amounts for those years and not as revised PPS rates, and shall be repaid by the FQHC or RHC to the extent that it is not expended for the specified purposes.
(6)The department shall notify the provider of the departments discretionary decision in writing.
(g)(1)An FQHC or RHC visit means a face-to-face encounter between an FQHC or RHC patient and a physician, physician assistant, nurse practitioner, certified nurse-midwife, clinical psychologist, licensed clinical social worker, or a visiting nurse. For purposes of this section, physician shall be interpreted in a manner consistent with the Centers for Medicare and Medicaid Services Medicare Rural Health Clinic and Federally Qualified Health Center Manual (Publication 27), or its successor, only to the extent that it defines the professionals whose services are reimbursable on a per-visit basis and not as to the types of services that these professionals may render during these visits and shall include a physician and surgeon, osteopath, podiatrist, dentist, optometrist, and chiropractor. A visit shall also include a face-to-face encounter between an FQHC or RHC patient and a comprehensive perinatal practitioner, as defined in Section 51179.7 of Title 22 of the California Code of Regulations, providing comprehensive perinatal services, a four-hour day of attendance at an adult day health care center, and any other provider identified in the state plans definition of an FQHC or RHC visit.
(2)(A)A visit shall also include a face-to-face encounter between an FQHC or RHC patient and a dental hygienist, a dental hygienist in alternative practice, or a marriage and family therapist.
(B)Notwithstanding subdivision (e), if an FQHC or RHC that currently includes the cost of the services of a dental hygienist in alternative practice, or a marriage and family therapist for the purposes of establishing its FQHC or RHC rate chooses to bill these services as a separate visit, the FQHC or RHC shall apply for an adjustment to its per-visit rate, and, after the rate adjustment has been approved by the department, shall bill these services as a separate visit. However, multiple encounters with dental professionals or marriage and family therapists that take place on the same day shall constitute a single visit. The department shall develop the appropriate forms to determine which FQHCs or RHCs rates shall be adjusted and to facilitate the calculation of the adjusted rates. An FQHCs or RHCs application for, or the departments approval of, a rate adjustment pursuant to this subparagraph shall not constitute a change in scope of service within the meaning of subdivision (e). An FQHC or RHC that applies for an adjustment to its rate pursuant to this subparagraph may continue to bill for all other FQHC or RHC visits at its existing per-visit rate, subject to reconciliation, until the rate adjustment for visits between an FQHC or RHC patient and a dental hygienist, a dental hygienist in alternative practice, or a marriage and family therapist has been approved. Any approved increase or decrease in the providers rate shall be made within six months after the date of receipt of the departments rate adjustment forms pursuant to this subparagraph and shall be retroactive to the beginning of the fiscal year in which the FQHC or RHC submits the request, but in no case shall the effective date be earlier than January 1, 2008.
(C)An FQHC or RHC that does not provide dental hygienist, dental hygienist in alternative practice, or marriage and family therapist services, and later elects to add these services, services and bill these services as a separate visit, shall process the addition of these services as a change in scope of service pursuant to subdivision (e).
(h)If FQHC or RHC services are partially reimbursed by a third-party payer, such as a managed care entity (as defined in Section 1396u-2(a)(1)(B) of Title 42 of the United States Code), the Medicare Program, or the Child Health and Disability Prevention (CHDP) program, the department shall reimburse an FQHC or RHC for the difference between its per-visit PPS rate and receipts from other plans or programs on a contract-by-contract basis and not in the aggregate, and may not include managed care financial incentive payments that are required by federal law to be excluded from the calculation.
(i)(1)An entity that first qualifies as an FQHC or RHC in the year 2001 or later, a newly licensed facility at a new location added to an existing FQHC or RHC, and any entity that is an existing FQHC or RHC that is relocated to a new site shall each have its reimbursement rate established in accordance with one of the following methods, as selected by the FQHC or RHC:
(A)The rate may be calculated on a per-visit basis in an amount that is equal to the average of the per-visit rates of three comparable FQHCs or RHCs located in the same or adjacent area with a similar caseload.
(B)In the absence of three comparable FQHCs or RHCs with a similar caseload, the rate may be calculated on a per-visit basis in an amount that is equal to the average of the per-visit rates of three comparable FQHCs or RHCs located in the same or an adjacent service area, or in a reasonably similar geographic area with respect to relevant social, health care, and economic characteristics.
(C)At a new entitys one-time election, the department shall establish a reimbursement rate, calculated on a per-visit basis, that is equal to 100 percent of the projected allowable costs to the FQHC or RHC of furnishing FQHC or RHC services during the first 12 months of operation as an FQHC or RHC. After the first 12-month period, the projected per-visit rate shall be increased by the Medicare Economic Index then in effect. The projected allowable costs for the first 12 months shall be cost settled and the prospective payment reimbursement rate shall be adjusted based on actual and allowable cost per visit.
(D)The department may adopt any further and additional methods of setting reimbursement rates for newly qualified FQHCs or RHCs as are consistent with Section 1396a(bb)(4) of Title 42 of the United States Code.
(2)In order for an FQHC or RHC to establish the comparability of its caseload for purposes of subparagraph (A) or (B) of paragraph (1), the department shall require that the FQHC or RHC submit its most recent annual utilization report as submitted to the Office of Statewide Health Planning and Development, unless the FQHC or RHC was not required to file an annual utilization report. FQHCs or RHCs that have experienced changes in their services or caseload subsequent to the filing of the annual utilization report may submit to the department a completed report in the format applicable to the prior calendar year. FQHCs or RHCs that have not previously submitted an annual utilization report shall submit to the department a completed report in the format applicable to the prior calendar year. The FQHC or RHC shall not be required to submit the annual utilization report for the comparable FQHCs or RHCs to the department, but shall be required to identify the comparable FQHCs or RHCs.
(3)The rate for any newly qualified entity set forth under this subdivision shall be effective retroactively to the later of the date that the entity was first qualified by the applicable federal agency as an FQHC or RHC, the date a new facility at a new location was added to an existing FQHC or RHC, or the date on which an existing FQHC or RHC was relocated to a new site. The FQHC or RHC shall be permitted to continue billing for Medi-Cal covered benefits on a fee-for-service basis under its existing provider number until it is informed of its FQHC or RHC enrollment approval, and the department shall reconcile the difference between the fee-for-service payments and the FQHCs or RHCs prospective payment rate at that time.
(j)Visits occurring at an intermittent clinic site, as defined in subdivision (h) of Section 1206 of the Health and Safety Code, of an existing FQHC or RHC, or in a mobile unit as defined by paragraph (2) of subdivision (b) of Section 1765.105 of the Health and Safety Code, shall be billed by and reimbursed at the same rate as the FQHC or RHC establishing the intermittent clinic site or the mobile unit, subject to the right of the FQHC or RHC to request a scope-of-service adjustment to the rate.
(k)An FQHC or RHC may elect to have pharmacy or dental services reimbursed on a fee-for-service basis, utilizing the current fee schedules established for those services. These costs shall be adjusted out of the FQHCs or RHCs clinic base rate as scope-of-service changes. An FQHC or RHC that reverses its election under this subdivision shall revert to its prior rate, subject to an increase to account for all Medicare Economic Index increases occurring during the intervening time period, and subject to any increase or decrease associated with applicable scope-of-service adjustments as provided in subdivision (e).
(l)FQHCs and RHCs may appeal a grievance or complaint concerning ratesetting, scope-of-service changes, and settlement of cost report audits, in the manner prescribed by Section 14171. The rights and remedies provided under this subdivision are cumulative to the rights and remedies available under all other provisions of law of this state.
(m)The department shall, no later than March 30, 2008, promptly seek all necessary federal approvals in order to implement this section, including any amendments to the state plan. To the extent that any element or requirement of this section is not approved, the department shall submit a request to the federal Centers for Medicare and Medicaid Services for any waivers that would be necessary to implement this section.
(n)The department shall implement this section only to the extent that federal financial participation is obtained.
(a)The federally qualified health center services described in Section 1396d(a)(2)(C) of Title 42 of the United States Code are covered benefits.
(b)The rural health clinic services described in Section 1396d(a)(2)(B) of Title 42 of the United States Code are covered benefits.
(c)Federally qualified health center services and rural health clinic services shall be reimbursed on a per-visit basis in accordance with the definition of visit set forth in subdivision (g).
(d)Effective October 1, 2004, and on each October 1, thereafter, until no longer required by federal law, federally qualified health center (FQHC) and rural health clinic (RHC) per-visit rates shall be increased by the Medicare Economic Index applicable to primary care services in the manner provided for in Section 1396a(bb)(3)(A) of Title 42 of the United States Code. Prior to January 1, 2004, FQHC and RHC per-visit rates shall be adjusted by the Medicare Economic Index in accordance with the methodology set forth in the state plan in effect on October 1, 2001.
(e)(1)An FQHC or RHC may apply for an adjustment to its per-visit rate based on a change in the scope of services provided by the FQHC or RHC. Rate changes based on a change in the scope of services provided by an FQHC or RHC shall be evaluated in accordance with Medicare reasonable cost principles, as set forth in Part 413 (commencing with Section 413.1) of Title 42 of the Code of Federal Regulations, or its successor.
(2)Subject to the conditions set forth in subparagraphs (A) to (D), inclusive, of paragraph (3), a change in scope of service means any of the following:
(A)The addition of a new FQHC or RHC service that is not incorporated in the baseline prospective payment system (PPS) rate, or a deletion of an FQHC or RHC service that is incorporated in the baseline PPS rate.
(B)A change in service due to amended regulatory requirements or rules.
(C)A change in service resulting from relocating or remodeling an FQHC or RHC.
(D)A change in types of services due to a change in applicable technology and medical practice utilized by the center or clinic.
(E)An increase in service intensity attributable to changes in the types of patients served, including, but not limited to, populations with HIV or AIDS, or other chronic diseases, or homeless, elderly, migrant, or other special populations.
(F)Any changes in any of the services described in subdivision (a) or (b), or in the provider mix of an FQHC or RHC or one of its sites.
(G)Changes in operating costs attributable to capital expenditures associated with a modification of the scope of any of the services described in subdivision (a) or (b), including new or expanded service facilities, regulatory compliance, or changes in technology or medical practices at the center or clinic.
(H)Indirect medical education adjustments and a direct graduate medical education payment that reflects the costs of providing teaching services to interns and residents.
(I)Any changes in the scope of a project approved by the federal Health Resources and Service Services Administration (HRSA).
(3)No change in costs shall, in and of itself, be considered a scope-of-service change unless all of the following apply:
(A)The increase or decrease in cost is attributable to an increase or decrease in the scope of services defined in subdivisions (a) and (b), as applicable.
(B)The cost is allowable under Medicare reasonable cost principles set forth in Part 413 (commencing with Section 413) of Subchapter B of Chapter 4 of Title 42 of the Code of Federal Regulations, or its successor.
(C)The change in the scope of services is a change in the type, intensity, duration, or amount of services, or any combination thereof.
(D)The net change in the FQHCs or RHCs rate equals or exceeds 1.75 percent for the affected FQHC or RHC site. For FQHCs and RHCs that filed consolidated cost reports for multiple sites to establish the initial prospective payment reimbursement rate, the 1.75-percent threshold shall be applied to the average per-visit rate of all sites for the purposes of calculating the cost associated with a scope-of-service change. Net change means the per-visit rate change attributable to the cumulative effect of all increases and decreases for a particular fiscal year.
(4)An FQHC or RHC may submit requests for scope-of-service changes once per fiscal year, only within 90 days following the beginning of the FQHCs or RHCs fiscal year. Any approved increase or decrease in the providers rate shall be retroactive to the beginning of the FQHCs or RHCs fiscal year in which the request is submitted.
(5)An FQHC or RHC shall submit a scope-of-service rate change request within 90 days of the beginning of any FQHC or RHC fiscal year occurring after the effective date of this section, if, during the FQHCs or RHCs prior fiscal year, the FQHC or RHC experienced a decrease in the scope of services provided that the FQHC or RHC either knew or should have known would have resulted in a significantly lower per-visit rate. If an FQHC or RHC discontinues providing onsite pharmacy or dental services, it shall submit a scope-of-service rate change request within 90 days of the beginning of the following fiscal year. The rate change shall be effective as provided for in paragraph (4). As used in this paragraph, significantly lower means an average per-visit rate decrease in excess of 2.5 percent.
(6)Notwithstanding paragraph (4), if the approved scope-of-service change or changes were initially implemented on or after the first day of an FQHCs or RHCs fiscal year ending in calendar year 2001, but before the adoption and issuance of written instructions for applying for a scope-of-service change, the adjusted reimbursement rate for that scope-of-service change shall be made retroactive to the date the scope-of-service change was initially implemented. Scope-of-service changes under this paragraph shall be required to be submitted within the later of 150 days after the adoption and issuance of the written instructions by the department, or 150 days after the end of the FQHCs or RHCs fiscal year ending in 2003.
(7)All references in this subdivision to fiscal year shall be construed to be references to the fiscal year of the individual FQHC or RHC, as the case may be.
(f)(1)An FQHC or RHC may request a supplemental payment if extraordinary circumstances beyond the control of the FQHC or RHC occur after December 31, 2001, and PPS payments are insufficient due to these extraordinary circumstances. Supplemental payments arising from extraordinary circumstances under this subdivision shall be solely and exclusively within the discretion of the department and shall not be subject to subdivision (l). These supplemental payments shall be determined separately from the scope-of-service adjustments described in subdivision (e). Extraordinary circumstances include, but are not limited to, acts of nature, changes in applicable requirements in the Health and Safety Code, changes in applicable licensure requirements, and changes in applicable rules or regulations. Mere inflation of costs alone, absent extraordinary circumstances, shall not be grounds for supplemental payment. If an FQHCs or RHCs PPS rate is sufficient to cover its overall costs, including those associated with the extraordinary circumstances, then a supplemental payment is not warranted.
(2)The department shall accept requests for supplemental payment at any time throughout the prospective payment rate year.
(3)Requests for supplemental payments shall be submitted in writing to the department and shall set forth the reasons for the request. Each request shall be accompanied by sufficient documentation to enable the department to act upon the request. Documentation shall include the data necessary to demonstrate that the circumstances for which supplemental payment is requested meet the requirements set forth in this section. Documentation shall include all of the following:
(A)A presentation of data to demonstrate reasons for the FQHCs or RHCs request for a supplemental payment.
(B)Documentation showing the cost implications. The cost impact shall be material and significant, two hundred thousand dollars ($200,000) or 1 percent of a facilitys total costs, whichever is less.
(4)A request shall be submitted for each affected year.
(5)Amounts granted for supplemental payment requests shall be paid as lump-sum amounts for those years and not as revised PPS rates, and shall be repaid by the FQHC or RHC to the extent that it is not expended for the specified purposes.
(6)The department shall notify the provider of the departments discretionary decision in writing.
(g)(1)An FQHC or RHC visit means a face-to-face encounter between an FQHC or RHC patient and a physician, physician assistant, nurse practitioner, certified nurse-midwife, clinical psychologist, licensed clinical social worker, or a visiting nurse. For purposes of this section, physician shall be interpreted in a manner consistent with the Centers for Medicare and Medicaid Services Medicare Rural Health Clinic and Federally Qualified Health Center Manual (Publication 27), or its successor, only to the extent that it defines the professionals whose services are reimbursable on a per-visit basis and not as to the types of services that these professionals may render during these visits and shall include a physician and surgeon, osteopath, podiatrist, dentist, optometrist, and chiropractor. A visit shall also include a face-to-face encounter between an FQHC or RHC patient and a comprehensive perinatal services practitioner, as defined in Section 51179.1 51179.7 of Title 22 of the California Code of Regulations, providing comprehensive perinatal services, a four-hour day of attendance at an adult day health care center, and any other provider identified in the state plans definition of an FQHC or RHC visit.
(2)(A)A visit shall also include a face-to-face encounter between an FQHC or RHC patient and a dental hygienist or hygienist, a dental hygienist in alternative practice. practice, or a marriage and family therapist.
(B)Notwithstanding subdivision (e), an FQHC or RHC that currently includes the cost of the services of a dental hygienist in alternative practice practice, or a marriage and family therapist for the purposes of establishing its FQHC or RHC rate shall apply for an adjustment to its per-visit rate, and, after the rate adjustment has been approved by the department, shall bill these services as a separate visit. However, multiple encounters with dental professionals or marriage and family therapists that take place on the same day shall constitute a single visit. The department shall develop the appropriate forms to determine which FQHCs or RHC RHCs rates shall be adjusted and to facilitate the calculation of the adjusted rates. An FQHCs or RHCs application for, or the departments approval of, a rate adjustment pursuant to this subparagraph shall not constitute a change in scope of service within the meaning of subdivision (e). An FQHC or RHC that applies for an adjustment to its rate pursuant to this subparagraph may continue to bill for all other FQHC or RHC visits at its existing per-visit rate, subject to reconciliation, until the rate adjustment for visits between an FQHC or RHC patient and a dental hygienist or hygienist, a dental hygienist in alternative practice practice, or a marriage and family therapist has been approved. Any approved increase or decrease in the providers rate shall be made within six months after the date of receipt of the departments rate adjustment forms pursuant to this subparagraph and shall be retroactive to the beginning of the fiscal year in which the FQHC or RHC submits the request, but in no case shall the effective date be earlier than January 1, 2008.
(C)An FQHC or RHC that does not provide dental hygienist or hygienist, dental hygienist in alternative practice practice, or marriage and family therapist services, and later elects to add these services, shall process the addition of these services as a change in scope of service pursuant to subdivision (e).
(h)If FQHC or RHC services are partially reimbursed by a third-party payer, such as a managed care entity (as defined in Section 1396u-2(a)(1)(B) of Title 42 of the United States Code), the Medicare Program, or the Child Health and Disability Prevention (CHDP) program, the department shall reimburse an FQHC or RHC for the difference between its per-visit PPS rate and receipts from other plans or programs on a contract-by-contract basis and not in the aggregate, and may not include managed care financial incentive payments that are required by federal law to be excluded from the calculation.
(i)(1)An entity that first qualifies as an FQHC or RHC in the year 2001 or later, a newly licensed facility at a new location added to an existing FQHC or RHC, and any entity that is an existing FQHC or RHC that is relocated to a new site shall each have its reimbursement rate established in accordance with one of the following methods, as selected by the FQHC or RHC:
(A)The rate may be calculated on a per-visit basis in an amount that is equal to the average of the per-visit rates of three comparable FQHCs or RHCs located in the same or adjacent area with a similar caseload.
(B)In the absence of three comparable FQHCs or RHCs with a similar caseload, the rate may be calculated on a per-visit basis in an amount that is equal to the average of the per-visit rates of three comparable FQHCs or RHCs located in the same or an adjacent service area, or in a reasonably similar geographic area with respect to relevant social, health care, and economic characteristics.
(C)At a new entitys one-time election, the department shall establish a reimbursement rate, calculated on a per-visit basis, that is equal to 100 percent of the projected allowable costs to the FQHC or RHC of furnishing FQHC or RHC services during the first 12 months of operation as an FQHC or RHC. After the first 12-month period, the projected per-visit rate shall be increased by the Medicare Economic Index then in effect. The projected allowable costs for the first 12 months shall be cost settled and the prospective payment reimbursement rate shall be adjusted based on actual and allowable cost per visit.
(D)The department may adopt any further and additional methods of setting reimbursement rates for newly qualified FQHCs or RHCs as are consistent with Section 1396a(bb)(4) of Title 42 of the United States Code.
(2)In order for an FQHC or RHC to establish the comparability of its caseload for purposes of subparagraph (A) or (B) of paragraph (1), the department shall require that the FQHC or RHC submit its most recent annual utilization report as submitted to the Office of Statewide Health Planning and Development, unless the FQHC or RHC was not required to file an annual utilization report. FQHCs or RHCs that have experienced changes in their services or caseload subsequent to the filing of the annual utilization report may submit to the department a completed report in the format applicable to the prior calendar year. FQHCs or RHCs that have not previously submitted an annual utilization report shall submit to the department a completed report in the format applicable to the prior calendar year. The FQHC or RHC shall not be required to submit the annual utilization report for the comparable FQHCs or RHCs to the department, but shall be required to identify the comparable FQHCs or RHCs.
(3)The rate for any newly qualified entity set forth under this subdivision shall be effective retroactively to the later of the date that the entity was first qualified by the applicable federal agency as an FQHC or RHC, the date a new facility at a new location was added to an existing FQHC or RHC, or the date on which an existing FQHC or RHC was relocated to a new site. The FQHC or RHC shall be permitted to continue billing for Medi-Cal covered benefits on a fee-for-service basis under its existing provider number until it is informed of its enrollment as an FQHC or RHC, RHC enrollment approval, and the department shall reconcile the difference between the fee-for-service payments and the FQHCs or RHCs prospective payment rate at that time.
(j)Visits occurring at an intermittent clinic site, as defined in subdivision (h) of Section 1206 of the Health and Safety Code, of an existing FQHC or RHC, or in a mobile unit as defined by paragraph (2) of subdivision (b) of Section 1765.105 of the Health and Safety Code, shall be billed by and reimbursed at the same rate as the FQHC or RHC establishing the intermittent clinic site or the mobile unit, subject to the right of the FQHC or RHC to request a scope-of-service adjustment to the rate.
(k)An FQHC or RHC may elect to have pharmacy or dental services reimbursed on a fee-for-service basis, utilizing the current fee schedules established for those services. These costs shall be adjusted out of the FQHCs or RHCs clinic base rate as scope-of-service changes. An FQHC or RHC that reverses its election under this subdivision shall revert to its prior rate, subject to an increase to account for all MEI Medicare Economic Index increases occurring during the intervening time period, and subject to any increase or decrease associated with applicable scope-of-services scope-of-service adjustments as provided in subdivision (e).
(l)FQHCs and RHCs may appeal a grievance or complaint concerning ratesetting, scope-of-service changes, and settlement of cost report audits, in the manner prescribed by Section 14171. The rights and remedies provided under this subdivision are cumulative to the rights and remedies available under all other provisions of law of this state.
(m)The department shall, by no later than March 30, 2008, promptly seek all necessary federal approvals in order to implement this section, including any amendments to the state plan. To the extent that any element or requirement of this section is not approved, the department shall submit a request to the federal Centers for Medicare and Medicaid Services for any waivers that would be necessary to implement this section.
(n)The department shall implement this section only to the extent that federal financial participation is obtained.
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Date
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Status
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|---|---|
| Jun 9, 2016 | Referred to Com. on HEALTH. |
| Sep 2, 2016 | Enrolled and presented to the Governor at 12 p.m. |
| Aug 25, 2016 | Senate amendments concurred in. To Engrossing and Enrolling. (Ayes 78. Noes 0. Page 6289.). |
| Aug 25, 2016 | Senate amendments concurred in. To Engrossing and Enrolling. |
| Aug 23, 2016 | In Assembly. Concurrence in Senate amendments pending. May be considered on or after August 25 pursuant to Assembly Rule 77. |
| Aug 22, 2016 | Read third time. Passed. Ordered to the Assembly. (Ayes 39. Noes 0. Page 5250.). |
| Aug 22, 2016 | Read third time. Passed. Ordered to the Assembly. |
| Aug 18, 2016 | Read second time. Ordered to third reading. |
| Aug 17, 2016 | Read third time and amended. Ordered to second reading. |
| Aug 15, 2016 | Read second time. Ordered to third reading. |
| Aug 11, 2016 | From committee: Do pass. (Ayes 7. Noes 0.) (August 11). |
| Aug 1, 2016 | In committee: Referred to APPR. suspense file. |
| Jun 23, 2016 | From committee: Do pass and re-refer to Com. on APPR. (Ayes 9. Noes 0.) (June 22). Re-referred to Com. on APPR. |
| Feb 10, 2016 | Read first time. To print. |
| Jun 2, 2016 | In Senate. Read first time. To Com. on RLS. for assignment. |
| Jun 1, 2016 | Read third time. Passed. Ordered to the Senate. (Ayes 78. Noes 1.) |
| Jun 1, 2016 | Read third time. Passed. Ordered to the Senate. (Ayes 78. Noes 1. Page 5092.) |
| Jun 1, 2016 | Read third time. Passed. Ordered to the Senate. |
| May 31, 2016 | Read second time. Ordered to third reading. |
| May 27, 2016 | Read second time and amended. Ordered returned to second reading. |
| May 27, 2016 | From committee: Amend, and do pass as amended. (Ayes 19. Noes 0.) (May 27). |
| Apr 6, 2016 | In committee: Set, first hearing. Referred to APPR. suspense file. |
| Mar 30, 2016 | From committee: Do pass and re-refer to Com. on APPR. (Ayes 18. Noes 0.) (March 29). Re-referred to Com. on APPR. |
| Feb 25, 2016 | Referred to Com. on HEALTH. |
| Feb 11, 2016 | From printer. May be heard in committee March 12. |
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Date
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Description
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Location
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Votes
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|---|---|---|---|---|
| Aug 25, 2016 | AB 1863 WOOD Concurrence in Senate Amendments | Assembly Floor |
Passed |
|
| Aug 22, 2016 | Assembly 3rd Reading AB1863 Wood By Mitchell | Senate Floor |
Passed |
|
| Aug 11, 2016 | Do pass | Senate Standing Committee on Appropriations |
Passed |
|
| Aug 1, 2016 | Placed on suspense file | Senate Standing Committee on Appropriations |
Passed |
|
| Jun 22, 2016 | Do pass, but first be re-referred to the Committee on [Appropriations] | Senate Standing Committee on Health |
Passed |
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| Jun 1, 2016 | AB 1863 WOOD Assembly Third Reading | Assembly Floor |
Passed |
|
| May 27, 2016 | Do pass as amended. | Assembly Standing Committee on Appropriations |
Passed |
|
| Mar 29, 2016 | Do pass and be re-referred to the Committee on [Appropriations] | Assembly Standing Committee on Health |
Passed |
This list shows positions taken on this bill by organizations on the date displayed, which is linked to the original source.
Positions by individuals are not included.
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Organization
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Position
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Date
|
|---|---|---|
| Aids Project Los Angeles | ** Support | Aug 22, 2016 |
| American Association For Marriage And Family Therapy -- California Division | * Support | Jun 22, 2016 |
| Arroyo Vista Family Health Center | ** Support | Aug 22, 2016 |
| Association of California Healthcare Districts | ** Support | Aug 22, 2016 |
| Board of Behavioral Sciences | ** Support | Jun 22, 2016 |
| Board of Supervisors of Santa Clara County | * Support | Jun 22, 2016 |
| Borrego Health | ** Support | Aug 22, 2016 |
| California Academy Of Family Physicians | ** Support | Jun 22, 2016 |
| California Association Of Marriage And Family Therapists | ** Support | Aug 22, 2016 |
| California Health Plus Advocates | * Support | Jun 22, 2016 |
| California Primary Care Association | ** Support | Aug 22, 2016 |
| California Psychological Association | ** Against | Aug 22, 2016 |
| California School-Based Health Alliance | ** Support | Jun 22, 2016 |
| CaliforniaHealth+ Advocates | * Support | Jun 22, 2016 |
| Coalition of Orange County Community Health Centers | ** Support | Aug 22, 2016 |
| Community Clinic Association of Los Angeles County | ** Support | Aug 22, 2016 |
| Community Health Partnership | ** Support | Aug 22, 2016 |
| County Behavioral Health Directors Assoc. | ** Support | Aug 22, 2016 |
| County Health Executives Association Of California | ** Support | Aug 22, 2016 |
| Department Of Finance | ** Against | Aug 22, 2016 |
| Family Health Centers of San Diego | ** Support | Aug 22, 2016 |
| Golden Valley Health Center | ** Support | Aug 22, 2016 |
| Health Alliance of Northern CA | ** Support | Aug 22, 2016 |
| L.A. Care Health Plan | ** Support | Jun 22, 2016 |
| La Maestra Community Health Centers | ** Support | Aug 22, 2016 |
| National Association Of Social Workers, California Chapter | ** Against | Aug 22, 2016 |
| Neighborhood Health Care | * Support | Jun 22, 2016 |
| North Coast Clinic Network | ** Support | Mar 29, 2016 |
| Northeast Valley Health Corporation | ** Support | Aug 22, 2016 |
| Omni Family Health | ** Support | Aug 22, 2016 |
| Open Door Community Health Centers | ** Support | Mar 29, 2016 |
| Operation Samahan | ** Support | Aug 22, 2016 |
| San Joaquin County | ** Support | Aug 22, 2016 |
| Santa Clara County Board of Supervisors | * Support | Jun 22, 2016 |
| Santa Clara; County Of | ** Support | Aug 22, 2016 |
| West County Health Centers | ** Support | Aug 22, 2016 |
| Westside Family Health Center | ** Support | Aug 22, 2016 |
CONCURRENCE IN SENATE AMENDMENTS
CSA1 Bill Id:AB 1863
Author:(Wood)
As Amended Ver:August 17, 2016
Majority vote
ASSEMBLY: | 78-1 | (June 1, 2016) | SENATE: | 39-0 | (August 22, 2016) |
Original Committee Reference: HEALTH
SUMMARY: Adds marriage and family therapists (MFTs) to the list of healthcare professionals that qualify for a face-to-face encounter with a patient at Federally Qualified Health Centers (FQHCs) or Rural Health Clinics (RHCs) for purposes of a per-visit Medi-Cal payment under the prospective payment system (PPS). Makes conforming changes, including requiring an FQHC or an RHC that includes the costs of the services of an MFT that chooses to bill these services as a separate visit, to apply for an adjustment to its per-visit rate; that multiple encounters with an MFT on the same day constitutes a single visit; adjustment of rates; and, change in scope of service requirements.
The Senate amendments make this bill operative only if SB 1335 (Mitchell) of the current legislative session and this bill are both chaptered and become effective on or before January 1, 2017, and this bill is chaptered last.
FISCAL EFFECT: According to the Senate Appropriations Committee:
- One-time costs, likely in the low millions to recalculate the PPS rate for clinics that are providing marriage and family therapist services or wish to add those services (General Fund and federal funds). The bill requires clinics that are currently including marriage and family therapist services in the costs used to calculate their PPS rate to seek a recalculation of the rate to allow the clinic to bill for face-to-face visits. The process for recalculating a PPS rate requires a detailed review of utilization and expenditures by clinics. For example, assuming that the cost of performing such a review is about $10,000 and that 500 clinics seek a recalculation, the administrative costs to the Department of Health Care Services would be about $5 million.
- No significant increase in costs is expected for MFT services currently being provided in eligible clinics. Under the current system for calculating the PPS rate paid by Medi-Cal to federally qualified health centers and rural health clinics, the total amount of eligible services (including mental health services) provided to Medi-Cal beneficiaries is divided by the number of eligible face-to-face visits (e.g. a visit with a physician or clinical psychologist). Because the bill requires a recalculation of the PPS to account for the fact that MFTs would be eligible for face-to-face billing before a clinic can bill for such an encounter, the Medi-Cal program is not expected to pay more for services currently being provided. (In other words, a clinic employing MFTs would be able to bill for more face-to-face encounters, but the PPS rate would be lower to account for those visits.)
- Unknown potential increase in Medi-Cal paid visits to eligible clinics. Under current law, a Medi-Cal beneficiary who visits a federally qualified health center or rural health clinic must be seen by certain types of providers (not including MFTs) in order for the clinic to bill Medi-Cal for the visit. In theory, the bill could allow clinics to bill Medi-Cal for more overall visits, because it may be easier to hire MFTs than other practitioners, such as physicians or psychologists. However, under current practice, clinics can already qualify a patient visit by having the patient see seven categories of health care providers. The actual impact on overall visitations to qualifying clinics may be small, given that clinics can already use a variety of practitioners to qualify the patient visit for payment from Medi-Cal.
COMMENTS: According to the author, psychologists and licensed clinical social workers are currently employed by RHCs and FQHCs and these clinics receive reimbursement for these providers. While clinics may employ an MFT, there is not a reimbursement mechanism for these professionals, which creates a disincentive to hire MFTs. MFTs are billable and recognized providers under the Medi-Cal program but not in community settings. Within the primary care setting, up to 26% of patients have some mental health disorder. This measure brings parity throughout the Medi-Cal program and allows for the utilization of all qualified mental health providers, regardless of how or where the treatment is provided.
FQHCs and RHCs serve a significant portion of the uninsured and underinsured in California. They are open-door providers that treat patients on a sliding scale fee structure and make their services available regardless of a patient's ability to pay. There are approximately 600 FQHCs and 350 RHCs in California. All FQHCs, and a majority of the RHCs, are either non-profit community clinics or government entities. Because clinics are safety net providers, their continued survival depends heavily on the stability and adequacy of revenues from the Medi-Cal program. FQHCs and RHCs are paid by Medi-Cal on a "per visit" basis in an amount equal to the clinic's cost of delivering services. Essentially, DHCS calculates the annual cost of care provided by each clinic and divides the total by the number of visits to determine a per visit rate.
Reimbursement to FQHCs and RHCs is governed by state and federal law. FQHCs and RHCs are reimbursed by Medi-Cal on a per-visit rate which is known as the PPS. For Medi-Cal managed care plan patients, DHCS reimburses FQHCs and RHCs for the difference between its per-visit PPS rate and the payment made by the plan. This payment is known as a "wrap around" payment. The Medi-Cal managed care wrap-around rate was established to reimburse providers for the difference between their PPS rate and their Medi-Cal managed care reimbursement rate.
DHCS' policy on same day visits, as stated in its in its State Plan Amendment, is that encounters with more than one health professional and/or multiple encounters with the same health professional, which take place on the same day and at a single FQHC or RHC location, constitute a single visit, except that more than one visit may be counted on the same day: 1) when the clinic patient, after the first visit, suffers illness or injury requiring another diagnosis or treatment; or, 2) when the clinic patient has a face-to-face encounter with a dentist or dental hygienist and then also has a face-to-face encounter with another health professional or comprehensive perinatal services practitioner on the same date. Mental health visits are treated for Medi-Cal billing purposes as a same day visit, and separate billing on the same day for a medical visits and a mental health visit is not allowed.
Analysis Prepared by: Rosielyn Pulmano / HEALTH / (916) 319-2097 FN: 00045340003280
Office of Senate Floor Analyses (916) 651-1520 Fax: (916) 327-4478 | AB 1863 |
THIRD READING
Bill No: AB 1863
Amended: 8/17/16 in Senate
SENATE HEALTH COMMITTEE: 9-0, 6/22/16
AYES: Hernandez, Nguyen, Hall, Mitchell, Monning, Nielsen, Pan, Roth, Wolk
SENATE APPROPRIATIONS COMMITTEE: 7-0, 8/11/16
AYES: Lara, Bates, Beall, Hill, McGuire, Mendoza, Nielsen
ASSEMBLY FLOOR: 78-1, 6/1/16 - See last page for vote
SUBJECT: Medi-Cal: federally qualified health centers: rural health centers
SOURCE: California Primary Care Association
California Association of Marriage and Family Therapists
DIGEST: This bill adds marriage and family therapists to the list of healthcare professionals that qualify for a face-to-face encounter with a patient at Federally Qualified Health Centers or Rural Health Clinics for purposes of a per-visit Medi-Cal payment under the prospective payment system.
Senate Floor Amendments of 8/17/16 add provisions to prevent chaptering out SB 1335 (Mitchell).
Existing law:
- Establishes the Medi-Cal program, administered by the Department of Health Care Services (DHCS), which provides comprehensive health care coverage for low-income individuals. Federally Qualified Health Center (FQHC) and Rural Health Clinic (RHC) services are covered benefits under the Medi-Cal program.
- Requires FQHCs and RHCs to be reimbursed on a per-visit basis. Defines a “visit” as a face-to-face encounter between an FQHC or RHC patient and the following health care providers: a physician, physician assistant, nurse practitioner, certified nurse midwife, clinical psychologist, licensed clinical social worker, visiting nurse, podiatrist, dentist, optometrist, chiropractor, comprehensive perinatal services practitioner providing comprehensive perinatal services, a four-hour day of attendance at an Adult Day Health Care Center; and, any other provider identified in the state plan’s definition of an FQHC or RHC visit. The reimbursement structure for FQHCs and RHCs is known as the prospective payment system (PPS).
- Requires FQHC and RHC per-visit rates to be increased by the Medicare Economic Index (MEI) applicable to primary care services in the manner provided for in federal law.
- Permits FQHC or RHC to apply for an adjustment to its per-visit rate based on a change in the scope of services provided by the FQHC or RHC. Requires rate changes based on a change in the scope of services provided by an FQHC or RHC to be evaluated in accordance with Medicare reasonable cost principles.
This bill:
- Adds marriage and family therapists (MFTs) to the list of health care professionals that qualify for a face-to-face encounter with a patient at FQHCs or RHCs for purposes of a per-visit Medi-Cal payment under the PPS.
- Requires, if an FQHC or RHC that currently includes the cost of the services of a MFT for the purposes of establishing its FQHC or RHC rate and chooses to bill these services as a separate visit, the FQHC or RHC to apply for an adjustment to its per-visit PPS rate. Requires the FQHC or RHC, after the rate adjustment has been approved by DHCS, to bill these services as a separate visit.
- Permits an FQHC or RHC that applies for an adjustment to its PPS rate to continue to bill for all other FQHC or RHC visits at its existing per-visit rate, subject to reconciliation, until the rate adjustment for visits between an FQHC or RHC patient and a MFT has been approved.
- Requires any approved increase or decrease in the provider’s PPS rate to be made within six months after the date of receipt of DHCS’ rate adjustment forms and to be retroactive to the beginning of the fiscal year in which the FQHC or RHC submits the request, but in no case the effective date be earlier than January 1, 2008.
- Requires an FQHC or RHC that does not provide MFT services, and later elects to add these services and to bill for these services as a separate visit to process the addition of these services as a change in scope of service.
- Requires multiple encounters with MFTs that take place on the same day to constitute a single visit.
- Modifies existing law FQHC and RHC dental hygienist in alterative practice provisions when the FQHC and RHC currently includes the cost of the services of a dental hygienist in alternative practice in its FQHC or RHC rate by requiring the FQHC or RHC to apply for an adjustment to its per-visit rate if the FQHC or RHC chooses to bill these services as a separate visit.
- Modifies existing law FQHC and RHC provisions that require an FQHC or RHC that does not provide dental hygienist in alternative practice services, and later elects to add these services to process the addition of those services as a change in scope of service if the FQHC and RHC bills these services as a separate visit.
Comments
- Author’s statement. According to the author, as part of California’s implementation of the Affordable Care Act (ACA), mental health and substance abuse disorder services were deemed an essential health benefit for Medi-Cal managed care plans. Along with the expansion of behavioral health benefits for Medi-Cal beneficiaries, there has been an extensive enrollment expansion as well. Within the primary care setting, up to 26% of patients have some mental health disorder. One in seven Californians are served by community clinics and health centers (CCHCs) and behavioral health services are available onsite at CCHCs in 50 of California’s 58 counties. It is essential we maximize availability to qualified mental health providers and assure access is offered in key areas served primarily by rural health clinics and FQHCs. As of February 2012, there were 31,865 licensed MFTs in California, and 19,009 LCSW and 16,228 licensed psychologists. Adding MFTs to the list of PPS billable providers will solve existing gaps in workforce capacity by providing clinics with an adequate source of funding for their employment, which will also help meet the demand for mental health services, particularly in rural communities.
- Background on FQHCs and RHCs. FQHCs and RHCs are federal designated clinics that are required to serve medically underserved populations that provide primary care services. FQHCs and RHCs provided over 10.5 million Medi-Cal visits in 2013. Demand for Medi-Cal services is expected to increase due to the expansion of Medi-Cal eligibility as a result of the Medicaid expansion and the enrollment simplification provisions of the federal ACA.
Medi-Cal reimbursement to FQHCs and RHCs is governed by state and federal law. FQHCs and RHCs are reimbursed by Medi-Cal on a per-visit rate which is known as the PPS. Each FQHC and RHC has a specific PPS Medi-Cal rate for each face-to-face encounter, irrespective of the reason for the visit. For Medi-Cal managed care plan patients, DHCS reimburses FQHCs and RHCs for the difference between its per-visit PPS rate and the payment made by the plan. This payment is known as a “wrap around” payment. The Medi-Cal managed care wrap-around rate was established to reimburse providers for the difference between their PPS rate and their Medi-Cal managed care reimbursement rate.
FQHCs and RHCs are both reimbursed under the PPS system. The average ($178.14) and median ($157.24) PPS rate paid to an FQHC and RHC in 2014-15 is considerably higher than the most common primary care visit reimbursement rates in Medi-Cal, but it also includes additional services not included in a primary care visit. The rationale for the enhanced reimbursement is to ensure that FQHCs and RHCs do not use federal grant funds intended for uninsured and special needs populations to back-fill for potentially below-cost Medicare or Medi-Cal rates. Because FQHCs are required to receive an MEI adjustment to their rates under federal law, and because of their role in providing primary care access to the Medi-Cal population, FQHCs have been exempted from the Medi-Cal rate reductions enacted in prior budget years.
FISCAL EFFECT: Appropriation: No Fiscal Com.: Yes Local: No
According to the Senate Appropriations Committee:
- One-time costs, likely in the low millions to recalculate the PPS rate for clinics that are providing MFT services or wish to add those services (General Fund and federal funds). The bill requires clinics that are currently including marriage and family therapist services in the costs used to calculate their PPS rate to seek a recalculation of the rate to allow the clinic to bill for face-to-face visits. The process for recalculating a PPS rate requires a detailed review of utilization and expenditures by clinics. For example, assuming that the cost of performing such a review is about $10,000 and that 500 clinics seek a recalculation, the administrative costs to DHCS would be about $5 million.
- No significant increase in costs is expected for MFT services currently being provided in eligible clinics. Under the current system for calculating the PPS rate paid by Medi-Cal to federally qualified health centers and rural health clinics, the total amount of eligible services (including mental health services) provided to Medi-Cal beneficiaries is divided by the number of eligible face-to-face visits (e.g. a visit with a physician or clinical psychologist). Because the bill requires a recalculation of the PPS to account for the fact that MFTs would be eligible for face-to-face billing before a clinic can bill for such an encounter, the Medi-Cal program is not expected to pay more for services currently being provided. (In other words, a clinic employing MFTs would be able to bill for more face-to-face encounters, but the PPS rate would be lower to account for those visits.)
- Unknown potential increase in Medi-Cal paid visits to eligible clinics. Under current law, a Medi-Cal beneficiary who visits a federally qualified health center or rural health clinic must be seen by certain types of providers (not including MFTs) in order for the clinic to bill Medi-Cal for the visit. In theory, the bill could allow clinics to bill Medi-Cal for more overall visits, because it may be easier to hire MFTs than other practitioners, such as physicians or psychologists. However, under current practice, clinics can already qualify a patient visit by having the patient see seven categories of health care providers. The actual impact on overall visitations to qualifying clinics may be small, given that clinics can already use a variety of practitioners to qualify the patient visit for payment from Medi-Cal.
California Primary Care Association (co-source)
California Association of Marriage and Family Therapists (co-source)
AIDS Project Los Angeles
Arroyo Vista Family Health Center
Association of California Healthcare Districts
Borrego Health
Clinicas De Salud Del Pueblo
Coalition of Orange County Community Health Centers
Community Clinic Association of Los Angeles County
Community Health Partnership
County Behavioral Health Directors Assoc.
County Health Executives Association of California
County of Santa Clara
Family Health Centers of San Diego
Golden Valley Health Center
Health Alliance of Northern CA
La Maestra Community Health Centers
Northeast Valley Health Corporation
Omni Family Health
Operation Samahan
San Joaquin County
Westside Family Health Center
West County Health Centers
OPPOSITION: (Verified 8/17/16)
California Psychological Association
Department of Finance
National Association of Social Workers, California Chapter
ARGUMENTS IN SUPPORT: This bill is sponsored by CaliforniaHealth+ Advocates (CH+A is also known as the California Primary Care Association (CPCA)), which writes that this bill will allow MFTs working in FQHCs to become billable providers in Medi-Cal. CPCA writes, as part of California’s implementation of the ACA, mental health and substance use disorder services were deemed an essential health benefit for Medi-Cal managed care health plans. Recognizing the workforce shortage of personnel able to meet the demand for mental health services created by expanded insurance coverage, DHCS updated the Medicaid State Plan to include MFTs as Medi-Cal mental health providers. However, the State did not update FQHC statute to allow FQHCs and RHCs to include MFTs as Medi-Cal billable providers. CPCA writes that this bill will also lower the total cost of care because these patients will be seeking preventive, primary care services, in order to address their behavioral health needs before they end up in crisis and access care through much more expensive and less ineffective avenues such as an emergency room.
The County Behavioral Health Directors Associations (CBHDA) writes in support that the ACA expanded mental health and substance use disorders and has resulted in a major expansion in the number of Medi-Cal beneficiaries. CBHDA writes that it is appropriate to maximize access to qualified mental health providers and assure access is available in key areas primarily served by RHCs and FQHCs. CBHDA concludes that adding MFTs to the list of PPS billable providers will reduce existing gaps in workforce capacity by providing clinics with an adequate source of funding for their professionals and will help meet the demand for mental health services.
ARGUMENTS IN OPPOSITION: The National Association of Social Workers-California Chapter (NASW-CA) writes in opposition that this bill is unnecessary as there are sufficient numbers of unemployed social workers that can fill these positions and California schools of social work graduate approximately 10,000 bachelors and master’s degree social workers each year, and there are another 13,000 in the pipeline to receive their full license. In addition, NASW-CA maintains these clinics serve a population that is very diverse and in poverty, and that while both MFT's and social workers have mental health training, only social workers have extensive training in providing culturally competent services to these disadvantaged and impoverished communities. NASW-CA states a social worker is trained to view clients from the person-in-the-environment/whole person perspective, as opposed to simply focusing on the pathology of a mental illness. Finally, NASW-CA argues this bill could be very costly for each FQHC to recalculate their PPS rate and it believes this bill is costly, unnecessary and ill-timed as a recently enacted law contains a pilot program for a different payment methodology for FQHCs.
The California Psychological Association writes in opposition that the long history of non-competitive salaries and potentially remote work locations would seem to necessitate this bill. However, there has been movement by the psychology profession, resulting in increases of psychologists in these settings. The move towards integrated health care model makes psychologists poised to be the best trained clinicians to work with a team of interdisciplinary clinicians in FQHCs and RHCs.
The Department of Finance is opposed to this measure, arguing this bill is unnecessary and will result in unknown but potentially significant General Fund costs in the Medi-Cal program.
ASSEMBLY FLOOR: 78-1, 6/1/16
AYES: Achadjian, Alejo, Travis Allen, Arambula, Atkins, Baker, Bigelow, Bloom, Bonilla, Bonta, Brough, Brown, Burke, Calderon, Campos, Chang, Chau, Chávez, Chiu, Chu, Cooley, Cooper, Dababneh, Dahle, Daly, Dodd, Eggman, Frazier, Beth Gaines, Cristina Garcia, Eduardo Garcia, Gatto, Gipson, Gomez, Gonzalez, Gordon, Gray, Grove, Hadley, Roger Hernández, Holden, Irwin, Jones, Jones-Sawyer, Kim, Lackey, Levine, Linder, Lopez, Low, Maienschein, Mathis, Mayes, McCarty, Medina, Melendez, Mullin, Nazarian, Obernolte, O'Donnell, Olsen, Patterson, Quirk, Ridley-Thomas, Rodriguez, Salas, Santiago, Steinorth, Mark Stone, Thurmond, Ting, Wagner, Waldron, Weber, Wilk, Williams, Wood, Rendon
NOES: Harper
NO VOTE RECORDED: Gallagher
Prepared by: Scott Bain / HEALTH / (916) 651-4111
8/18/16 16:34:41
**** END ****
Office of Senate Floor Analyses (916) 651-1520 Fax: (916) 327-4478 | AB 1863 |
THIRD READING
Bill No: AB 1863
Amended: 5/27/16 in Assembly
SENATE HEALTH COMMITTEE: 9-0, 6/22/16
AYES: Hernandez, Nguyen, Hall, Mitchell, Monning, Nielsen, Pan, Roth, Wolk
SENATE APPROPRIATIONS COMMITTEE: 7-0, 8/11/16
AYES: Lara, Bates, Beall, Hill, McGuire, Mendoza, Nielsen
ASSEMBLY FLOOR: 78-1, 6/1/16 - See last page for vote
SUBJECT: Medi-Cal: federally qualified health centers: rural health centers
SOURCE: California Primary Care Association
California Association of Marriage and Family Therapists
DIGEST: This bill adds marriage and family therapists to the list of healthcare professionals that qualify for a face-to-face encounter with a patient at Federally Qualified Health Centers or Rural Health Clinics for purposes of a per-visit Medi-Cal payment under the prospective payment system.
Existing law:
- Establishes the Medi-Cal program, administered by the Department of Health Care Services (DHCS), which provides comprehensive health care coverage for low-income individuals. Federally Qualified Health Center (FQHC) and Rural Health Clinic (RHC) services are covered benefits under the Medi-Cal program.
- Requires FQHCs and RHCs to be reimbursed on a per-visit basis. Defines a “visit” as a face-to-face encounter between an FQHC or RHC patient and the following health care providers: a physician, physician assistant, nurse practitioner, certified nurse midwife, clinical psychologist, licensed clinical social worker, visiting nurse, podiatrist, dentist, optometrist, chiropractor, comprehensive perinatal services practitioner providing comprehensive perinatal services, a four-hour day of attendance at an Adult Day Health Care Center; and, any other provider identified in the state plan’s definition of an FQHC or RHC visit. The reimbursement structure for FQHCs and RHCs is known as the prospective payment system (PPS).
- Requires FQHC and RHC per-visit rates to be increased by the Medicare Economic Index (MEI) applicable to primary care services in the manner provided for in federal law.
- Permits FQHC or RHC to apply for an adjustment to its per-visit rate based on a change in the scope of services provided by the FQHC or RHC. Requires rate changes based on a change in the scope of services provided by an FQHC or RHC to be evaluated in accordance with Medicare reasonable cost principles.
This bill:
- Adds marriage and family therapists (MFTs) to the list of health care professionals that qualify for a face-to-face encounter with a patient at FQHCs or RHCs for purposes of a per-visit Medi-Cal payment under the PPS.
- Requires, if an FQHC or RHC that currently includes the cost of the services of a MFT for the purposes of establishing its FQHC or RHC rate and chooses to bill these services as a separate visit, the FQHC or RHC to apply for an adjustment to its per-visit PPS rate. Requires the FQHC or RHC, after the rate adjustment has been approved by DHCS, to bill these services as a separate visit.
- Permits an FQHC or RHC that applies for an adjustment to its PPS rate to continue to bill for all other FQHC or RHC visits at its existing per-visit rate, subject to reconciliation, until the rate adjustment for visits between an FQHC or RHC patient and a MFT has been approved.
- Requires any approved increase or decrease in the provider’s PPS rate to be made within six months after the date of receipt of DHCS’ rate adjustment forms and to be retroactive to the beginning of the fiscal year in which the FQHC or RHC submits the request, but in no case the effective date be earlier than January 1, 2008.
- Requires an FQHC or RHC that does not provide MFT services, and later elects to add these services and to bill for these services as a separate visit to process the addition of these services as a change in scope of service.
- Requires multiple encounters with MFTs that take place on the same day to constitute a single visit.
- Modifies existing law FQHC and RHC dental hygienist in alterative practice provisions when the FQHC and RHC currently includes the cost of the services of a dental hygienist in alternative practice in its FQHC or RHC rate by requiring the FQHC or RHC to apply for an adjustment to its per-visit rate if the FQHC or RHC chooses to bill these services as a separate visit.
- Modifies existing law FQHC and RHC provisions that require an FQHC or RHC that does not provide dental hygienist in alternative practice services, and later elects to add these services to process the addition of those services as a change in scope of service if the FQHC and RHC bills these services as a separate visit.
Comments
- Author’s statement. According to the author, as part of California’s implementation of the Affordable Care Act (ACA), mental health and substance abuse disorder services were deemed an essential health benefit for Medi-Cal managed care plans. Along with the expansion of behavioral health benefits for Medi-Cal beneficiaries, there has been an extensive enrollment expansion as well. Within the primary care setting, up to 26% of patients have some mental health disorder. One in seven Californians are served by community clinics and health centers (CCHCs) and behavioral health services are available onsite at CCHCs in 50 of California’s 58 counties. It is essential we maximize availability to qualified mental health providers and assure access is offered in key areas served primarily by rural health clinics and FQHCs. As of February 2012, there were 31,865 licensed MFTs in California, and 19,009 LCSW and 16,228 licensed psychologists. Adding MFTs to the list of PPS billable providers will solve existing gaps in workforce capacity by providing clinics with an adequate source of funding for their employment, which will also help meet the demand for mental health services, particularly in rural communities.
- Background on FQHCs and RHCs. FQHCs and RHCs are federal designated clinics that are required to serve medically underserved populations that provide primary care services. FQHCs and RHCs provided over 10.5 million Medi-Cal visits in 2013. Demand for Medi-Cal services is expected to increase due to the expansion of Medi-Cal eligibility as a result of the Medicaid expansion and the enrollment simplification provisions of the federal ACA.
Medi-Cal reimbursement to FQHCs and RHCs is governed by state and federal law. FQHCs and RHCs are reimbursed by Medi-Cal on a per-visit rate which is known as the PPS. Each FQHC and RHC has a specific PPS Medi-Cal rate for each face-to-face encounter, irrespective of the reason for the visit. For Medi-Cal managed care plan patients, DHCS reimburses FQHCs and RHCs for the difference between its per-visit PPS rate and the payment made by the plan. This payment is known as a “wrap around” payment. The Medi-Cal managed care wrap-around rate was established to reimburse providers for the difference between their PPS rate and their Medi-Cal managed care reimbursement rate.
FQHCs and RHCs are both reimbursed under the PPS system. The average ($178.14) and median ($157.24) PPS rate paid to an FQHC and RHC in 2014-15 is considerably higher than the most common primary care visit reimbursement rates in Medi-Cal, but it also includes additional services not included in a primary care visit. The rationale for the enhanced reimbursement is to ensure that FQHCs and RHCs do not use federal grant funds intended for uninsured and special needs populations to back-fill for potentially below-cost Medicare or Medi-Cal rates. Because FQHCs are required to receive an MEI adjustment to their rates under federal law, and because of their role in providing primary care access to the Medi-Cal population, FQHCs have been exempted from the Medi-Cal rate reductions enacted in prior budget years.
FISCAL EFFECT: Appropriation: No Fiscal Com.: Yes Local: No
According to the Senate Appropriations Committee:
- One-time costs, likely in the low millions to recalculate the PPS rate for clinics that are providing MFT services or wish to add those services (General Fund and federal funds). The bill requires clinics that are currently including marriage and family therapist services in the costs used to calculate their PPS rate to seek a recalculation of the rate to allow the clinic to bill for face-to-face visits. The process for recalculating a PPS rate requires a detailed review of utilization and expenditures by clinics. For example, assuming that the cost of performing such a review is about $10,000 and that 500 clinics seek a recalculation, the administrative costs to DHCS would be about $5 million.
- No significant increase in costs is expected for MFT services currently being provided in eligible clinics. Under the current system for calculating the PPS rate paid by Medi-Cal to federally qualified health centers and rural health clinics, the total amount of eligible services (including mental health services) provided to Medi-Cal beneficiaries is divided by the number of eligible face-to-face visits (e.g. a visit with a physician or clinical psychologist). Because the bill requires a recalculation of the PPS to account for the fact that MFTs would be eligible for face-to-face billing before a clinic can bill for such an encounter, the Medi-Cal program is not expected to pay more for services currently being provided. (In other words, a clinic employing MFTs would be able to bill for more face-to-face encounters, but the PPS rate would be lower to account for those visits.)
- Unknown potential increase in Medi-Cal paid visits to eligible clinics. Under current law, a Medi-Cal beneficiary who visits a federally qualified health center or rural health clinic must be seen by certain types of providers (not including MFTs) in order for the clinic to bill Medi-Cal for the visit. In theory, the bill could allow clinics to bill Medi-Cal for more overall visits, because it may be easier to hire MFTs than other practitioners, such as physicians or psychologists. However, under current practice, clinics can already qualify a patient visit by having the patient see seven categories of health care providers. The actual impact on overall visitations to qualifying clinics may be small, given that clinics can already use a variety of practitioners to qualify the patient visit for payment from Medi-Cal.
California Primary Care Association (co-source)
California Association of Marriage and Family Therapists (co-source)
AIDS Project Los Angeles
Arroyo Vista Family Health Center
Association of California Healthcare Districts
Borrego Health
Clinicas De Salud Del Pueblo
Coalition of Orange County Community Health Centers
Community Clinic Association of Los Angeles County
Community Health Partnership
County Behavioral Health Directors Assoc.
County Health Executives Association of California
County of Santa Clara
Family Health Centers of San Diego
Golden Valley Health Center
Health Alliance of Northern CA
La Maestra Community Health Centers
Northeast Valley Health Corporation
Omni Family Health
Operation Samahan
San Joaquin County
Westside Family Health Center
West County Health Centers
California Psychological Association
Department of Finance
National Association of Social Workers, California Chapter
ARGUMENTS IN SUPPORT: This bill is sponsored by CaliforniaHealth+ Advocates (CH+A is also known as the California Primary Care Association (CPCA)), which writes that this bill will allow MFTs working in FQHCs to become billable providers in Medi-Cal. CPCA writes, as part of California’s implementation of the ACA, mental health and substance use disorder services were deemed an essential health benefit for Medi-Cal managed care health plans. Recognizing the workforce shortage of personnel able to meet the demand for mental health services created by expanded insurance coverage, DHCS updated the Medicaid State Plan to include MFTs as Medi-Cal mental health providers. However, the State did not update FQHC statute to allow FQHCs and RHCs to include MFTs as Medi-Cal billable providers. CPCA writes that this bill will also lower the total cost of care because these patients will be seeking preventive, primary care services, in order to address their behavioral health needs before they end up in crisis and access care through much more expensive and less ineffective avenues such as an emergency room.
The County Behavioral Health Directors Associations (CBHDA) writes in support that the ACA expanded mental health and substance use disorders and has resulted in a major expansion in the number of Medi-Cal beneficiaries. CBHDA writes that it is appropriate to maximize access to qualified mental health providers and assure access is available in key areas primarily served by RHCs and FQHCs. CBHDA concludes that adding MFTs to the list of PPS billable providers will reduce existing gaps in workforce capacity by providing clinics with an adequate source of funding for their professionals and will help meet the demand for mental health services.
ARGUMENTS IN OPPOSITION: The National Association of Social Workers-California Chapter (NASW-CA) writes in opposition that this bill is unnecessary as there are sufficient numbers of unemployed social workers that can fill these positions and California schools of social work graduate approximately 10,000 bachelors and master’s degree social workers each year, and there are another 13,000 in the pipeline to receive their full license. In addition, NASW-CA maintains these clinics serve a population that is very diverse and in poverty, and that while both MFT's and social workers have mental health training, only social workers have extensive training in providing culturally competent services to these disadvantaged and impoverished communities. NASW-CA states a social worker is trained to view clients from the person-in-the-environment/whole person perspective, as opposed to simply focusing on the pathology of a mental illness. Finally, NASW-CA argues this bill could be very costly for each FQHC to recalculate their PPS rate and it believes this bill is costly, unnecessary and ill-timed as a recently enacted law contains a pilot program for a different payment methodology for FQHCs.
The California Psychological Association writes in opposition that the long history of non-competitive salaries and potentially remote work locations would seem to necessitate this bill. However, there has been movement by the psychology profession, resulting in increases of psychologists in these settings. The move towards integrated health care model makes psychologists poised to be the best trained clinicians to work with a team of interdisciplinary clinicians in FQHCs and RHCs.
The Department of Finance is opposed to this measure, arguing this bill is unnecessary and will result in unknown but potentially significant General Fund costs in the Medi-Cal program.
ASSEMBLY FLOOR: 78-1, 6/1/16
AYES: Achadjian, Alejo, Travis Allen, Arambula, Atkins, Baker, Bigelow, Bloom, Bonilla, Bonta, Brough, Brown, Burke, Calderon, Campos, Chang, Chau, Chávez, Chiu, Chu, Cooley, Cooper, Dababneh, Dahle, Daly, Dodd, Eggman, Frazier, Beth Gaines, Cristina Garcia, Eduardo Garcia, Gatto, Gipson, Gomez, Gonzalez, Gordon, Gray, Grove, Hadley, Roger Hernández, Holden, Irwin, Jones, Jones-Sawyer, Kim, Lackey, Levine, Linder, Lopez, Low, Maienschein, Mathis, Mayes, McCarty, Medina, Melendez, Mullin, Nazarian, Obernolte, O'Donnell, Olsen, Patterson, Quirk, Ridley-Thomas, Rodriguez, Salas, Santiago, Steinorth, Mark Stone, Thurmond, Ting, Wagner, Waldron, Weber, Wilk, Williams, Wood, Rendon
NOES: Harper
NO VOTE RECORDED: Gallagher
Prepared by: Scott Bain / HEALTH / (916) 651-4111
8/15/16 19:36:08
**** END ****
SENATE COMMITTEE ON APPROPRIATIONS
Senator Ricardo Lara, Chair
2015 - 2016 Regular Session
AB 1863 (Wood) - Medi-Cal: federally qualified health centers: rural health centers
Version: May 27, 2016 | Policy Vote: HEALTH 9 - 0 |
Urgency: No | Mandate: No |
Hearing Date: August 1, 2016 | Consultant: Brendan McCarthy |
This bill meets the criteria for referral to the Suspense File.
Bill Summary:
AB 1863 would add marriage and family therapists (MFTs) to the list of health care providers that qualify for face-to-face encounter payments from the Medi-Cal program to federally qualified health centers and rural health clinics.
Fiscal Impact:
- One-time costs, likely in the low millions to recalculate the prospective payment system (PPS) rate for clinics that are providing marriage and family therapist services or wish to add those services (General Fund and federal funds). The bill requires clinics that are currently including marriage and family therapist services in the costs used to calculate their PPS rate to seek a recalculation of the rate to allow the clinic to bill for face-to-face visits. The process for recalculating a PPS rate requires a detailed review of utilization and expenditures by clinics. For example, assuming that the cost of performing such a review is about $10,000 and that 500 clinics seek a recalculation, the administrative costs to the Department of Health Care Services would be about $5 million.
- No significant increase in costs is expected for MFT services currently being provided in eligible clinics. Under the current system for calculating the PPS rate paid by Medi-Cal to federally qualified health centers and rural health clinics, the total amount of eligible services (including mental health services) provided to Medi-Cal beneficiaries is divided by the number of eligible face-to-face visits (e.g. a visit with a physician or clinical psychologist). Because the bill requires a recalculation of the PPS to account for the fact that MFTs would be eligible for face-to-face billing before a clinic can bill for such an encounter, the Medi-Cal program is not expected to pay more for services currently being provided. (In other words, a clinic employing MFTs would be able to bill for more face-to-face encounters, but the PPS rate would be lower to account for those visits.)
- Unknown potential increase in Medi-Cal paid visits to eligible clinics. Under current law, a Medi-Cal beneficiary who visits a federally qualified health center or rural health clinic must be seen by certain types of providers (not including MFTs) in order for the clinic to bill Medi-Cal for the visit. In theory, the bill could allow clinics to bill Medi-Cal for more overall visits, because it may be easier to hire MFTs than other practitioners, such as physicians or psychologists. However, under current practice, clinics can already qualify a patient visit by having the patient see seven categories of health care providers. The actual impact on overall visitations to qualifying clinics may be small, given that clinics can already use a variety of practitioners to qualify the patient visit for payment from Medi-Cal.
Background:
Under current law, the Medi-Cal program provides health care coverage for certain low income and disabled individuals.
In the Medi-Cal fee-for-service system, federally qualified health centers and rural health clinics are paid a per-visit payment known as the prospective payment system (PPS). The PPS rate is based on a baseline rate that reflects a federally qualified health center’s costs to provide services to in 1999-2000, adjusted for inflation. Those costs include the costs of eligible face-to-face visits (e.g. with a physician) and other services provided to Medi-Cal beneficiaries that are not eligible for billing as a face-to-face visit (e.g. visits with a registered nurse). When a Medi-Cal beneficiary in the managed care system receives care from a federally qualified health center, the managed care plan makes a per-visit payment to the center. Because the rates paid by managed care plans are significantly below the PPS rate, the state makes a supplemental “wrap-around” payment to the federally qualified health center to bring the total payment up to the PPS rate.
Under current law, clinics may bill Medi-Cal for face-to-face visits with several categories of health professionals, including physicians, nurse practitioners, clinical social workers, and others. Clinics cannot bill for face-to-face visits with MFTs. However, the cost to provide services to Medi-Cal beneficiaries by MFTs can be included in the calculation of the PPS rate. (MFTs were added as eligible providers of psychology services in the Medi-Cal program beginning in 2014.)
Proposed Law:
AB 1863 would add marriage and family therapists (MFTs) to the list of health care providers that qualify for face-to-face encounter payments from the Medi-Cal program to federally qualified health centers and rural health clinics.
The bill would require a federally qualified health center or a rural health clinic that currently includes the cost of MFT services in its PPS rate to seek a recalculation of the PPS rate by the Department of Health Care Services. Once the rate adjustment has been approved, the bill would authorize an eligible clinic to bill for those services as a separate visit.
The bill would require a federally qualified health center or a rural health clinic that does not currently provide services by MFTs that wants to add such services to do so by making a change in scope of service (which requires a recalculation of the PPS rate).
Related Legislation:
- AB 1335 (Mitchell) authorizes federally qualified health centers and rural health clinics to receive reimbursement for services county specialty mental health plans and through the Drug Medi-Cal program. That bill is pending in the Assembly.
- AB 858 (Wood, 2015) was substantially similar to this bill. That bill was vetoed by Governor Brown.
-- END --
SENATE COMMITTEE ON HEALTH
Senator Ed Hernandez, O.D., Chair
BILL NO: AB 1863
AUTHOR: | Wood | ||
VERSION: | May 27, 2016 | ||
HEARING DATE: | June 22, 2016 | ||
CONSULTANT: | Scott Bain | ||
SUBJECT: Medi-Cal: federally qualified health centers: rural health centers
SUMMARY:
Adds marriage and family therapists to the list of healthcare professionals that qualify for a face-to-face encounter with a patient at Federally Qualified Health Centers or Rural Health Clinics for purposes of a per-visit Medi-Cal payment under the prospective payment system.
Existing law:
- Establishes the Medi-Cal program, administered by the Department of Health Care Services (DHCS), which provides comprehensive health care coverage for low-income individuals. Federally Qualified Health Center (FQHC) and Rural Health Clinic (RHC) services are covered benefits under the Medi-Cal program.
- Requires FQHCs and RHCs to be reimbursed on a per-visit basis. Defines a “visit” as a face-to-face encounter between an FQHC or RHC patient and the following health care providers: a physician, physician assistant, nurse practitioner, certified nurse midwife, clinical psychologist, licensed clinical social worker, visiting nurse, podiatrist, dentist, optometrist, chiropractor, comprehensive perinatal services practitioner providing comprehensive perinatal services, a four-hour day of attendance at an Adult Day Health Care Center; and, any other provider identified in the state plan’s definition of an FQHC or RHC visit. The reimbursement structure for FQHCs and RHCs is known as the prospective payment system (PPS).
- Requires FQHC and RHC per-visit rates to be increased by the Medicare Economic Index (MEI) applicable to primary care services in the manner provided for in federal law.
- Permits FQHC or RHC to apply for an adjustment to its per-visit rate based on a change in the scope of services provided by the FQHC or RHC. Requires rate changes based on a change in the scope of services provided by an FQHC or RHC to be evaluated in accordance with Medicare reasonable cost principles.
This bill:
- Adds marriage and family therapists (MFTs) to the list of health care professionals that qualify for a face-to-face encounter with a patient at FQHCs or RHCs for purposes of a per-visit Medi-Cal payment under the PPS.
- Requires, if an FQHC or RHC that currently includes the cost of the services of a MFT for the purposes of establishing its FQHC or RHC rate and chooses to bill these services as a separate visit, the FQHC or RHC to apply for an adjustment to its per-visit PPS rate. Requires the FQHC or RHC, after the rate adjustment has been approved by DHCS, to bill these services as a separate visit.
- Permits an FQHC or RHC that applies for an adjustment to its PPS rate to continue to bill for all other FQHC or RHC visits at its existing per-visit rate, subject to reconciliation, until the rate adjustment for visits between an FQHC or RHC patient and a MFT has been approved.
- Requires any approved increase or decrease in the provider’s PPS rate to be made within six months after the date of receipt of DHCS’ rate adjustment forms and to be retroactive to the beginning of the fiscal year in which the FQHC or RHC submits the request, but in no case the effective date be earlier than January 1, 2008.
- Requires an FQHC or RHC that does not provide MFT services, and later elects to add these services and to bill for these services as a separate visit to process the addition of these services as a change in scope of service.
- Requires multiple encounters with MFTs that take place on the same day to constitute a single visit.
- Modifies existing law FQHC and RHC dental hygienist in alterative practice provisions when the FQHC and RHC currently includes the cost of the services of a dental hygienist in alternative practice in its FQHC or RHC rate by requiring the FQHC or RHC to apply for an adjustment to its per-visit rate if the FQHC or RHC chooses to bill these services as a separate visit.
- Modifies existing law FQHC and RHC provisions that require an FQHC or RHC that does not provide dental hygienist in alternative practice services, and later elects to add these services to process the addition of those services as a change in scope of service if the FQHC and RHC bills these services as a separate visit.
FISCAL EFFECT:
According to the Assembly Appropriations Committee:
- One-time costs, potentially in the millions, to recalculate the PPS rate for clinics that are providing MFT services or wish to add those services (GF/federal). The bill requires clinics that currently include MFT services in the costs used to calculate their PPS rate to seek a recalculation of the rate to allow the clinic to bill for visits. Recalculating a PPS rate requires a detailed review of utilization and expenditures by clinics. For example, assuming the cost per review is about $10,000 and 500 clinics seek a recalculation, the administrative costs to DHCS would be about $5 million.
- No significant increase in costs is expected for the current level of MFT services in eligible clinics. A clinic employing MFTs may be able to bill for more face-to-face encounters, but the PPS rate will be adjusted to account for those visits such that there is no projected net cost impact.
- On the other hand, if this bill increases access to mental health services in Medi-Cal by increasing the ability of clinics to employ qualified mental health professionals where the supply previously was constrained, it could result in unknown cost pressure to Medi-Cal to fund additional visits. There are nearly 40,000 licensed MFTs in the state, as compared to 22,000 LCSWs and 21,000 psychologists, suggesting increased flexibility to hire MFTs could lead to better access to mental health visits.
PRIOR VOTES:
Assembly Floor: | 78 - 1 |
Assembly Appropriations Committee: | 19 - 0 |
Assembly Health Committee: | 18 - 0 |
COMMENTS:
- Author’s statement. According to the author, as part of California’s implementation of the Affordable Care Act (ACA), mental health and substance abuse disorder services were deemed an essential health benefit for Medi-Cal managed care plans. Along with the expansion of behavioral health benefits for Medi-Cal beneficiaries, there has been an extensive enrollment expansion as well. Within the primary care setting, up to 26% of patients have some mental health disorder. One in seven Californians are served by community clinics and health centers (CCHCs) and behavioral health services are available onsite at CCHCs in 50 of California’s 58 counties. It is essential we maximize availability to qualified mental health providers and assure access is offered in key areas served primarily by rural health clinics and FQHCs. As of February 2012, there were 31,865 licensed MFTs in California, and 19,009 LCSW and 16,228 licensed psychologists. Adding MFTs to the list of PPS billable providers will solve existing gaps in workforce capacity by providing clinics with an adequate source of funding for their employment, which will also help meet the demand for mental health services, particularly in rural communities.
- Background on FQHCs and RHCs. FQHCs and RHCs are federal designated clinics that are required to serve medically underserved populations that provide primary care services. FQHCs and RHCs provided over 10.5 million Medi-Cal visits in 2013. Demand for Medi-Cal services is expected to increase due to the expansion of Medi-Cal eligibility as a result of the Medicaid expansion and the enrollment simplification provisions of the federal ACA.
Medi-Cal reimbursement to FQHCs and RHCs is governed by state and federal law. FQHCs and RHCs are reimbursed by Medi-Cal on a per-visit rate which is known as the PPS. Each FQHC and RHC has a specific PPS Medi-Cal rate for each face-to-face encounter, irrespective of the reason for the visit. For Medi-Cal managed care plan patients, DHCS reimburses FQHCs and RHCs for the difference between its per-visit PPS rate and the payment made by the plan. This payment is known as a “wrap around” payment. The Medi-Cal managed care wrap-around rate was established to reimburse providers for the difference between their PPS rate and their Medi-Cal managed care reimbursement rate.
FQHCs and RHCs are both reimbursed under the PPS system. The average ($178.14) and median ($157.24) PPS rate paid to an FQHC and RHC in 2014-15 is considerably higher than the most common primary care visit reimbursement rates in Medi-Cal, but it also includes additional services not included in a primary care visit. The rationale for the enhanced reimbursement is to ensure that FQHCs and RHCs do not use federal grant funds intended for uninsured and special needs populations to back-fill for potentially below-cost Medicare or Medi-Cal rates. Because FQHCs are required to receive an MEI adjustment to their rates under federal law, and because of their role in providing primary care access to the Medi-Cal population, FQHCs have been exempted from the Medi-Cal rate reductions enacted in prior budget years. - Recent Changes in Medi-Cal Coverage for Mental Health and Substance Use Services. Mental health and substance use disorder services in Medi-Cal have been significantly changed since the implementation of the ACA.
SB X1 1 (Hernandez and Steinberg, Chapter 4, Statutes of 2013) required Medi-Cal to cover the additional mental and substance use disorder benefits for both the newly eligible expansion population and the current Medi-Cal population. SB X1 1 requires mental health services included in the essential health benefit (EHB) package adopted by the state (the Legislature adopted the Kaiser Small Group Product [Kaiser Product] as the state’s EHB for the individual and small group health insurance market last session) to be covered under Medi-Cal, to the extent those services are not covered Medi-Cal benefits now. The additional mental health benefits required to be provided include group therapy and psychology (for non-specialty mental health program qualifying individuals). In addition, SB X1 1 required Medi-Cal to provide coverage for additional substance abuse disorder services included in the EHB adopted by the state. The additional substance use disorder services provided include: - Intensive Outpatient Treatment (Day Care Rehabilitation) - For non-pregnant/postpartum beneficiaries (only pregnant women were eligible for this service under Drug Medi-Cal prior to this change);
- Residential Substance Use Disorder Services - For non-pregnant/postpartum beneficiaries (only pregnant women were eligible for this service under Drug Medi-Cal prior to this change); and,
- Elective Inpatient Detox – This benefit was made broadly available (prior to this change, individuals had to have an underlying physical medical condition in order to receive inpatient detoxification services).
SB X1 1 also required Medi-Cal managed care plans to provide coverage for “mild to moderate” mental health benefits covered in the state plan, except for those benefits provided by county mental health plans under the Specialty Mental Health Services Waiver. Under the previous system, Medi-Cal managed care plans covered mental health services within the scope of practice of a primary care physician under their contracts with DHCS, while county specialty mental health plans provided mental health services to individuals with severe mental illness, and Medi-Cal fee-for-service provided services to individuals who fell between those two plans. SB X1 1 effectively provided mid-level mental health services through the Medi-Cal managed care plan, instead of in fee-for-services, resulting in more coordinated care and better access to services.
In 2014, DHCS received federal approval of State Plan Amendment (SPA) 14-012, which allowed MFTs to be providers of psychology services under Medi-Cal. In addition, registered MFT interns, registered associate clinical social workers and psychology assistants were added as providers of psychology services under the direction of a licensed mental health professional within their scope of services. The SPA was approved May 2, 2014 with an effective date of January 1, 2014.
- Related legislation. SB 1335 (Mitchell), authorizes FQHCs and RHCs to receive reimbursement from county specialty mental health plans and through Drug Medi-Cal under the terms of a contract between the FQHC and RHC and either the county or DHCS outside of the regular Medi-Cal reimbursement structure that applies to FQHCs and RHCs. SB 1335 is pending in the Assembly Health Committee.
- Prior legislation. AB 858 (Wood of 2015), included a similar provision adding MFTs to the list of healthcare professionals that could bill Medi-Cal for purposes of an FQHC or RHC visit. SB 858 and five other bills were vetoed by Governor Brown who indicated that:
These bills unnecessarily codify certain existing health care benefits or require the expansion or development of new benefits and procedures in the Medi-Cal program. Taken together, these bills would require new spending at a time when there is co0nsiderable uncertainty in the funding of this program.
Until the fiscal outlook for Medi-Cal is stabilized, I cannot support any of these measures.
AB 690 (Wood of 2015), was substantially similar to the provisions of this bill. AB 690 was held on the Assembly Appropriations suspense file.
AB 1785 (Lowenthal of 2012), would have added MFTs to the list of health care providers whose services are reimbursed through Medi-Cal on a per-visit basis by FQHCs and RHCs. AB 1785 was held on the Assembly Appropriations suspense file.
SB 260 (Steinberg of 2007), was substantially similar to this bill. SB 260 was vetoed by Governor Schwarzenegger who cited concerns about the fiscal impact of the bill.
- Support. This bill is sponsored by CaliforniaHealth+ Advocates (CH+A is also known as the California Primary Care Association (CPCA), which writes that this bill will allow MFTs working in FQHCs to become billable providers in Medi-Cal. CH+A) writes, as part of California’s implementation of the ACA, mental health and substance use disorder services were deemed an essential health benefit for Medi-Cal managed care health plans. Recognizing the workforce shortage of personnel able to meet the demand for mental health services created by expanded insurance coverage, DHCS updated the Medicaid State Plan to include MFTs as Medi-Cal mental health providers. However, the State did not update FQHC statute to allow FQHCs and RHCs to include MFTs as Medi-Cal billable providers. CPCA writes that this bill will also lower the total cost of care because these patients will be seeking preventive, primary care services, in order to address their behavioral health needs before they end up in crisis and access care through much more expensive and less ineffective avenues such as an emergency room.
The County Behavioral Health Directors Associations (CBHDA) writes in support that the ACA expanded mental health and substance use disorders and has resulted in a major expansion in the number of Medi-Cal beneficiaries. CBHDA writes that it is appropriate to maximize access to qualified mental health providers and assure access is available in key areas primarily served by RHCs and FQHCs. CBHDA concludes that adding MFTs to the list of PPS billable providers will reduce existing gaps in workforce capacity by providing clinics with an adequate source of funding for their professionals and will help meet the demand for mental health services.
- Opposition. The National Association of Social Workers-California Chapter (NASW-CA) writes in opposition that this bill is unnecessary as there are sufficient numbers of unemployed social workers that can fill these positions and California schools of social work graduate approximately 10,000 bachelors and master’s degree social workers each year, and there are another 13,000 in the pipeline to receive their full license. In addition, NASW-CA maintains these clinics serve a population that is very diverse and in poverty, and that while both MFT's and social workers have mental health training, only social workers have extensive training in providing culturally competent services to these disadvantaged and impoverished communities. NASW-CA states a social worker is trained to view clients from the person-in-the-environment/whole person perspective, as opposed to simply focusing on the pathology of a mental illness. Finally, NASW-CA argues this bill could be very costly for each FQHC to recalculate their PPS rate and it believes this bill is costly, unnecessary and ill-timed as a recently enacted law contains a pilot program for a different payment methodology for FQHCs.
The California Psychological Association writes in opposition that the long history of non-competitive salaries and potentially remote work locations would seem to necessitate this bill. However, there has been movement by the psychology profession, resulting in increases of psychologists in these settings. The move towards integrated health care model makes psychologists poised to be the best trained clinicians to work with a team of interdisciplinary clinicians in FQHCs and RHCs.
The Department of Finance is opposed to this measure, arguing this bill is unnecessary and will result in unknown but potentially significant General Fund costs in the Medi-Cal program.
SUPPORT AND OPPOSITION:
Support: CaliforniaHealth+ Advocates (sponsor)
AIDS Project Los Angeles
Arroyo Vista Family Health Center
Association of California Healthcare Districts
Board of Behavioral Sciences
Borrego Health
California School-Based Health Alliance
California Academy of Family Physicians
California Association of Marriage and Family Therapists
Clinicas De Salud Del Pueblo
Coalition of Orange County Community Health Centers
Community Clinic Association of Los Angeles County
Community Health Partnership
County Behavioral Health Directors Association
County Health Executives Association of California
County of Santa Clara
Family Health Centers of San Diego
Golden Valley Health Center
Health Alliance of Northern CA
L.A. Care Health Plan
La Maestra Community Health Centers
Northeast Valley Health Corporation
Omni Family Health
Operation Samahan
Santa Clara County Board of Supervisors
West County Health Centers
Westside Family Health Center
Oppose: California Psychological Association
Department of Finance
National Association of Social Workers, California Chapter
-- END --
ASSEMBLY THIRD READING
ATR Bill Id:AB 1863
Author:(Wood)
As Amended Ver:May 27, 2016
Majority vote
Committee | Votes | Ayes | Noes |
Health | 18-0 | Wood, Maienschein, Bonilla, Burke, Campos, Chiu, Dababneh, Gomez, Roger Hernández, Lackey, Olsen, Patterson, Ridley-Thomas, Rodriguez, Santiago, Steinorth, Thurmond, Waldron | |
Appropriations | 19-0 | Gonzalez, Bigelow, Bloom, Bonilla, Bonta, Calderon, Chang, Daly, Eggman, Eduardo Garcia, Roger Hernández, Holden, Jones, Obernolte, Quirk, Santiago, Wagner, Weber, Wood |
|
SUMMARY: Adds marriage and family therapists (MFTs) to the list of healthcare professionals that qualify for a face-to-face encounter with a patient at Federally Qualified Health Centers (FQHCs) or Rural Health Clinics (RHCs) for purposes of a per-visit Medi-Cal payment under the prospective payment system (PPS). Makes conforming changes, including requiring an FQHC or an RHC that includes the costs of the services of an MFT that chooses to bill these services as a separate visit, to apply for an adjustment to its per-visit rate; that multiple encounters with an MFT on the same day constitutes a single visit; adjustment of rates; and, change in scope of service requirements.
FISCAL EFFECT: According to the Assembly Appropriations Committee:
- One-time costs, potentially in the millions, to recalculate the PPS rate for clinics that are providing MFT services or wish to add those services (GF/federal). The bill requires clinics that currently include marriage and family therapist services in the costs used to calculate their PPS rate to seek a recalculation of the rate to allow the clinic to bill for visits. Recalculating a PPS rate requires a detailed review of utilization and expenditures by clinics. For example, assuming the cost per review is about $10,000 and 500 clinics seek a recalculation, the administrative costs to the Department of Health Care Services (DHCS) would be about $5 million.
- No significant increase in costs is expected for the current level of MFT services in eligible clinics. A clinic employing MFTs may be able to bill for more face-to-face encounters, but the PPS rate will be adjusted to account for those visits such that there is no projected net cost impact.
- On the other hand, if this bill increases access to mental health services in Medi-Cal by increasing the ability of clinics to employ qualified mental health professionals where the supply previously was constrained, it could result in unknown cost pressure to Medi-Cal to fund additional visits. There are nearly 40,000 licensed MFTs in the state, as compared to 22,000 LCSWs and 21,000 psychologists, suggesting increased flexibility to hire MFTs could lead to better access to mental health visits.
COMMENTS: According to the author, psychologists and licensed clinical social workers are currently employed by RHCs and FQHCs and these clinics receive reimbursement for these providers. While clinics may employ an MFT, there is not a reimbursement mechanism for these professionals, which creates a disincentive to hire MFTs. MFTs are billable and recognized providers under the Medi-Cal program but not in community settings. Within the primary care setting, up to 26% of patients have some mental health disorder. This measure brings parity throughout the Medi-Cal program and allows for the utilization of all qualified mental health providers, regardless of how or where the treatment is provided.
FQHCs and RHCs serve a significant portion of the uninsured and underinsured in California. They are open-door providers that treat patients on a sliding scale fee structure and make their services available regardless of a patient's ability to pay. There are approximately 600 FQHCs and 350 RHCs in California. All FQHCs, and a majority of the RHCs, are either non-profit community clinics or government entities. Because clinics are safety net providers, their continued survival depends heavily on the stability and adequacy of revenues from the Medi-Cal program. FQHCs and RHCs are paid by Medi-Cal on a "per visit" basis in an amount equal to the clinic's cost of delivering services. Essentially, DHCS calculates the annual cost of care provided by each clinic and divides the total by the number of visits to determine a per visit rate.
Community clinics and health centers provide health care to 14% of Californians. This figure is even higher in rural or remote areas that struggle to attract and retain health care providers. Mental health and substance abuse services are part of the essential health care benefits under the Patient Protection and Affordable Care Act (ACA). As such they are a part of Medi-Cal. Along with the expansion of these benefits, the expansion of the Medi-Cal program overall has increased the number of beneficiaries to over 12 million, placing even greater demands on Medi-Cal providers.
Reimbursement to FQHCs and RHCs is governed by state and federal law. FQHCs and RHCs are reimbursed by Medi-Cal on a per-visit rate which is known as the PPS. For Medi-Cal managed care plan patients, DHCS reimburses FQHCs and RHCs for the difference between its per-visit PPS rate and the payment made by the plan. This payment is known as a "wrap around" payment. The Medi-Cal managed care wrap-around rate was established to reimburse providers for the difference between their PPS rate and their Medi-Cal managed care reimbursement rate.
DHCS' policy on same day visits, as stated in its in its State Plan Amendment, is that encounters with more than one health professional and/or multiple encounters with the same health professional, which take place on the same day and at a single FQHC or RHC location, constitute a single visit, except that more than one visit may be counted on the same day: 1) when the clinic patient, after the first visit, suffers illness or injury requiring another diagnosis or treatment; or, 2) when the clinic patient has a face-to-face encounter with a dentist or dental hygienist and then also has a face-to-face encounter with another health professional or comprehensive perinatal services practitioner on the same date. Mental health visits are treated for Medi-Cal billing purposes as a same day visit, and separate billing on the same day for a medical visits and a mental health visit is not allowed.
Analysis Prepared by: Rosielyn Pulmano / HEALTH / (916) 319-2097 FN: 0003280
Date of Hearing: April 6, 2016
ASSEMBLY COMMITTEE ON APPROPRIATIONS
Lorena Gonzalez, Chair
ABPCA Bill Id:AB 1863
Author:(Wood) – As Introduced Ver:February 10, 2016
Policy Committee: | Health | Vote: | 18 - 0 |
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Urgency: No State Mandated Local Program: No Reimbursable: No
SUMMARY:
This bill adds marriage and family therapists (MFTs) to the list of health care professionals whose services are reimbursed through Medi-Cal on a per-visit basis to federally qualified health centers (FQHC) or rural health clinics (RHCs), and specifies procedures for adjusting rates for clinics who elect to bill Medi-Cal.
FISCAL EFFECT:
- One-time costs, potentially in the millions, to recalculate the prospective payment system (PPS) rate for clinics that are providing MFT services or wish to add those services (GF/federal). The bill requires clinics that currently include marriage and family therapist services in the costs used to calculate their PPS rate to seek a recalculation of the rate to allow the clinic to bill for visits. Recalculating a PPS rate requires a detailed review of utilization and expenditures by clinics. For example, assuming the cost per review is about $10,000 and 500 clinics seek a recalculation, the administrative costs to the Department of Health Care Services (DHCS) would be about $5 million.
- No significant increase in costs is expected for the current level of MFT services in eligible clinics. A clinic employing MFTs may be able to bill for more face-to-face encounters, but the PPS rate will be adjusted to account for those visits such that there is no projected net cost impact.
- On the other hand, if this bill increases access to mental health services in Medi-Cal by increasing the ability of clinics to employ qualified mental health professionals where the supply previously was constrained, it could result in unknown cost pressure to Medi-Cal to fund additional visits. There are nearly 40,000 licensed MFTs in the state, as compared to 22,000 LCSWs and 21,000 psychologists, suggesting increased flexibility to hire MFTs could lead to better access to mental health visits.
COMMENTS:
- Purpose. According to the author, Medi-Cal reimbursement for MFTs will allow clinics to see more low-income patients in need of mental health services. The author states that under existing law, psychologists and licensed clinical social workers (LCSWs) are employed by RHCs and FQHCs to provide mental health services, and receive reimbursement through Medi-Cal for that care. However, the author points out that while a RHC or FQHC can employ an MFT, the lack of reimbursement for the care provided to Medi-Cal patients acts as a disincentive for hiring. This bill is sponsored by the California Primary Care Association (CPCA).
- Clinic Reimbursement. Because of their unique role in providing health care to underserved communities and the uninsured, policymakers have historically attempted to ensure that community clinics remain financially viable. Federal law requires federally funded health programs, including Medicaid and Children's Health Insurance Program (CHIP), to pay clinics using a special reimbursement structure commonly called a prospective payment system (PPS). According to DHCS Form 3090, the Freestanding FQHC Cost Report Form, PPS rates are a clinic-specific per-visit rate, and are calculated by dividing costs for Medi-Cal-reimbursable services by Medi-Cal reimbursable visits. PPS rates are also adjusted by a growth rate to account for inflation. In addition, clinics can request a recalculation of their PPS rates based on a change in their scope of services. All clinics must provide at least a defined scope of primary care and mental health services, but may provide additional services as well. If clinics are paid by managed care plans in amounts less than their PPS rates, there is a reconciliation performed to ensure clinics get paid the full PPS rate through a wrap-around payment paid by DCHS. For Medi-Cal, current PPS rates vary from around $80 to over $650 per visit, depending on the mix of services provided at each clinic.
- Costs for MFT Services May Already Be Reflected in Base PPS Rate. Under current state law, an FQHC or RHC “visit” means a face-to-face encounter between a patient and certain type of health care provider defined in state law. A visit must be documented in order for a clinic to be reimbursed. According to DHCS, for clinics that provide MFTs within their approved scope of service, MFT services are included in the all-inclusive calculation of the PPS rate, but are not separately billable.
For example, a patient could visit a clinic to receive a medical check-up and be referred directly to an MFT employed by the clinic for mental health services. According to DHCS, MFT services rendered are reflected in the baseline PPS cost-based rate as long as they are within the approved clinic scope of service. At this time, however, a facility could not receive reimbursement for an MFT visit without receiving other services. This bill would allow such reimbursement.
- FQHC Payment Reform. The PPS system has been criticized as encouraging a higher volume of services rather than rewarding quality and efficiency, as well as limiting innovation by restricting provider types and care delivery settings. DHCS and the CPCA, the sponsor of this bill, have been discussing reforming the PPS methodology for several years. Chapter 760, Statutes of 2015 (SB 147, Hernández) authorizes a three-year payment reform pilot project for federally qualified health centers (FQHCs) using an alternative payment methodology (APM) authorized under federal Medicaid law, but not all clinics will participate. Theoretically, if clinic payment methodology was reformed on a permanent and statewide basis in a way that allowed clinics complete flexibility to choose provider types, a bill like this, specifying payment for a certain provider type, would not be necessary. But although this possibility is on the horizon, such a comprehensive change does not appear imminent.
- Support and Opposition. The National Association of Social Workers-California Chapter (NASW-CA) opposes the bill because they believe there is a sufficient workforce of social workers, and only social workers have the training and skills necessary to treat this community. The California Psychological Association is also opposed.
The bill is supported by California Association of Marriage and Family Therapists, AIDS Project Los Angeles, and the County Health Executives Association of California, in addition to CPCA and a number of clinic organizations.
- Related Legislation. SB 1335 (Mitchell), pending in Senate Health Committee, authorizes FQHCs and RHCs to elect to have Drug Medi-Cal and specialty mental health services to be reimbursed on a fee-for-service basis, according to the same criteria that applies to pharmacy and dental services.
- Previous Legislation.
- AB 858 (Wood) of 2015 included a similar provision adding MFTs to the list of healthcare professionals that could bill Medi-Cal for purposes of an FQHC or RHC visit. SB 858 and five other bills were vetoed by Governor Brown who indicated that
such “bills unnecessarily codify certain existing health care benefits or require the expansion or development of new benefits and procedures in the Medi-Cal program. Taken together, these bills would require new spending at a time when there is considerable uncertainty in the funding of this program. Until the fiscal outlook for Medi-Cal is stabilized, I cannot support any of these measures.” The author believes the fiscal outlook for Medi-Cal has stabilized due to recent state actions and the veto message is thereby addressed. - AB 690 (Wood) of 2015 was substantially similar to the provisions of this bill. It was held in the Assembly Appropriations suspense file when its provisions were merged with those of AB 858.
- AB 1785 (Lowenthal) of 2012 was similar to this bill and was held on the Suspense File of this committee.
- AB 1445 (Chesbro) of 2009 was similar to AB 848 (Wood), and was held on the Suspense File in the Senate Appropriations Committee.
- SB 260 (Steinberg) of 2007 was similar to AB 1445 and was vetoed by Governor Schwarzenegger on budgetary concerns.
Analysis Prepared by: Lisa Murawski / APPR. / (916) 319-2081
Date of Hearing: March 29, 2016
ASSEMBLY COMMITTEE ON HEALTH
Jim Wood, Chair
ABPCA Bill Id:AB 1863
Author:(Wood) – As Introduced Ver:February 10, 2016
SUBJECT: Medi-Cal: federally qualified health centers: rural health centers.
SUMMARY: Adds marriage and family therapists (MFTs) to the list of healthcare professionals that qualify for a face-to-face encounter with a patient at Federally Qualified Health Centers (FQHCs) or Rural Health Clinics (RHCs) for purposes of a per-visit Medi-Cal payment under the prospective payment system (PPS). Makes conforming changes, including requiring an FQHC or an RHC that includes the costs of the services of an MFT to apply for an adjustment to its per-visit rate; that multiple encounters with an MFT on the same day constitutes a single visit; adjustment of rates; and, change in scope of service requirements.
EXISTING LAW:
- Establishes the Medi-Cal program to provide comprehensive health benefits to low-income persons administered by the Department of Health Care Services (DHCS).
- Establishes a statutory structure for Medi-Cal payments being made under the PPS. These payments are for services provided by FQHCs and RHCs on a per-visit basis with rates determined prospectively. Federal law requires states to use a PPS system to pay clinics.
- Identifies those services that may be reimbursed as services identified in federal law as covered benefits for FQHCs and RHCs.
- Defines visit as a face to face encounter with a physicians, physician assistant, nurse practitioner, certified nurse midwife, clinical psychologist, licensed clinical social worker, visiting nurse, osteopath, podiatrist, dentist, dental hygienists, optometrist, chiropractor, comprehensive perinatal services practitioner, or adult day health care center. Authorizes other providers if identified in the state plan.
5) Allows only one visit per day to be reimbursed by Medi-Cal, except for a subsequent visit by a patient to a dental provider.
FISCAL EFFECT: This bill has not been analyzed by a fiscal committee.
COMMENTS:
- PURPOSE OF THIS BILL. According to the author, psychologists and licensed clinical social workers are currently employed by RHCs and FQHCs and these clinics receive reimbursement for these providers. While clinics may employ an MFT, there is not a reimbursement mechanism for these professionals, which creates a disincentive to hire MFTs. MFTs are billable and recognized providers under the Medi-Cal program but not in community settings. Within the primary care setting, up to 26% of patients have some mental health disorder. This measure brings parity throughout the Medi-Cal program and allows for the utilization of all qualified mental health providers, regardless of how or where the treatment is provided.
- BACKGROUND.
- FQHCs and RHCs. FQHCs and RHCs serve a significant portion of the uninsured and underinsured in California. They are open-door providers that treat patients on a sliding scale fee structure and make their services available regardless of a patient's ability to pay. There are approximately 600 FQHCs and 350 RHCs in California. All FQHCs, and a majority of the RHCs, are either non-profit community clinics or government entities. Because clinics are safety net providers, their continued survival depends heavily on the stability and adequacy of revenues from the Medi-Cal program. FQHCs and RHCs are paid by Medi-Cal on a "per visit" basis in an amount equal to the clinic's cost of delivering services. Essentially, DHCS calculates the annual cost of care provided by each clinic and divides the total by the number of visits to determine a per visit rate.
Community clinics and health centers provide health care to 14% of Californians. This figure is even higher in rural or remote areas that struggle to attract and retain health care providers. Mental health and substance abuse services are part of the essential health care benefits under the Patient Protection and Affordable Care Act (ACA). As such they are a part of Medi-Cal. Along with the expansion of these benefits, the expansion of the Medi-Cal program overall has increased the number of beneficiaries to over 12 million, placing even greater demands on Medi-Cal providers. - Medi-Cal Reimbursement to FQHCs and RHCs. Reimbursement to FQHCs and RHCs is governed by state and federal law. FQHCs and RHCs are reimbursed by Medi-Cal on a per-visit rate which is known as the PPS. For Medi-Cal managed care plan patients, DHCS reimburses FQHCs and RHCs for the difference between its per-visit PPS rate and the payment made by the plan. This payment is known as a “wrap around” payment. The Medi-Cal managed care wrap-around rate was established to reimburse providers for the difference between their PPS rate and their Medi-Cal managed care reimbursement rate.
- Same day visits. DHCS’ policy on same day visits, as stated in its in its State Plan Amendment, is that encounters with more than one health professional and/or multiple encounters with the same health professional, which take place on the same day and at a single FQHC or RHC location, constitute a single visit, except that more than one visit may be counted on the same day: i) when the clinic patient, after the first visit, suffers illness or injury requiring another diagnosis or treatment; or, ii) when the clinic patient has a face-to-face encounter with a dentist or dental hygienist and then also has a face-to-face encounter with another health professional or comprehensive perinatal services practitioner on the same date. Mental health visits are treated for Medi-Cal billing purposes as a same day visit, and separate billing on the same day for a medical visits and a mental health visit is not allowed.
- FQHCs and RHCs. FQHCs and RHCs serve a significant portion of the uninsured and underinsured in California. They are open-door providers that treat patients on a sliding scale fee structure and make their services available regardless of a patient's ability to pay. There are approximately 600 FQHCs and 350 RHCs in California. All FQHCs, and a majority of the RHCs, are either non-profit community clinics or government entities. Because clinics are safety net providers, their continued survival depends heavily on the stability and adequacy of revenues from the Medi-Cal program. FQHCs and RHCs are paid by Medi-Cal on a "per visit" basis in an amount equal to the clinic's cost of delivering services. Essentially, DHCS calculates the annual cost of care provided by each clinic and divides the total by the number of visits to determine a per visit rate.
- SUPPORT. The California Primary Care Association, the sponsor of this measure, and the Association of California Healthcare Districts state that as part of the implementation of the ACA, mental health and substance use disorder services were deemed an essential health benefit for Medi-Cal managed care plans. Recognizing the workforce shortage of personnel able to meet the demand for mental health services created by expanded health insurance coverage, California updated the State Plan to include MFTs as Medi-Cal mental health providers. However, existing law to allow FQHCs and RHCs to bill for the services of MFTs was not changed. The inclusion of MFTs will address a serious gap in behavioral health care access and increase cultural competency and diversity of California’s workforce. The North Coast Clinics Network points out that investing in preventive behavioral health services in the primary care setting is essential in linking patients to services in a timely manner while lowering the total cost of care.
- OPPOSITION. The National Association of Social Workers, California Chapter, believe this bill is unnecessary as there are sufficient social workers to fill the positions needed and only social workers have extensive training in providing culturally competent services to disadvantaged and impoverished communities.
- RELATED LEGISLATION. SB 1335 (Mitchell), pending in Senate Health Committee, authorizes FQHCs and RHCs to elect to have Drug Medi-Cal and specialty mental health services to be reimbursed on a fee-for-service basis, according to the same criteria that applies to pharmacy and dental services.
- PREVIOUS LEGISLATION.
- AB 858 (Wood) of 2015 included a similar provision adding MFTs to the list of healthcare professionals that could bill Medi-Cal for purposes of an FQHC or RHC visit. SB 858 and five other bills were vetoed by Governor Brown who indicated that
such “bills unnecessarily codify certain existing health care benefits or require the expansion or development of new benefits and procedures in the Medi-Cal program. Taken together, these bills would require new spending at a time when there is considerable uncertainty in the funding of this program. Until the fiscal outlook for Medi-Cal is stabilized, I cannot support any of these measures.” - AB 690 (Wood) of 2015 was substantially similar to the provisions of this bill but was held in the Assembly Appropriations suspense file.
- SB 260 (Steinberg) of 2007 was substantially similar to this bill. SB 260 was vetoed by Governor Schwarzenegger who cited concerns about the fiscal impact of the bill.
- AB 858 (Wood) of 2015 included a similar provision adding MFTs to the list of healthcare professionals that could bill Medi-Cal for purposes of an FQHC or RHC visit. SB 858 and five other bills were vetoed by Governor Brown who indicated that
- POLICY COMMENT. Last year, the Governor vetoed AB 858 (Wood) which included similar provisions contained in this bill. The author points out that the Governor’s veto message of AB 858 cited the instability of the Medi-Cal Program last year. Following the resolution of the Managed Care Organization tax this year and the renewed stability of the Medi-Cal system, the author believes that the Governor will accept the changes that are being proposed in this measure.
REGISTERED SUPPORT / OPPOSITION:
Support
California Primary Care Association (sponsor)
California Association of Marriage and Family Therapists
AIDS Project Los Angeles
Association of California Healthcare Districts
Community Clinic Association of Los Angeles County
County Health Executives Association of California
North Coast Clinic Network
Open Door Community Health Centers
Opposition
California Psychological Association
National Association of Social Workers, California Chapter
Analysis Prepared by: Rosielyn Pulmano / HEALTH / (916) 319-2097
Bill Author
Bill Co-Author(s):