HLS 19RS-618 ENGROSSED
2019 Regular Session
HOUSE BILL NO. 390
BY REPRESENTATIVE WHITE
Prefiled pursuant to Article III, Section 2(A)(4)(b)(i) of the Constitution of Louisiana.
MEDICAID: Relative to reimbursement rates paid to providers of disability services
1 AN ACT
2To enact Part II-A of Chapter 5-E of Title 40 of the Louisiana Revised Statutes of 1950, to
3 be comprised of R.S. 40:1250.1 through 1250.31, relative to services for persons
4 with disabilities; to provide relative to Medicaid reimbursement rates paid to such
5 providers by the Louisiana Department of Health; to establish procedures by which
6 the department shall set such rates; to provide for factors and data elements to be
7 utilized in the calculation of such rates; to require that rates meet certain conditions
8 and standards for adequacy; to provide for a rate review process; to require the
9 department to publish online and make available in printed form certain information
10 pertaining to rate-setting; to provide for legislative findings and intent; to provide for
11 definitions; to require administrative rulemaking; and to provide for related matters.
12Be it enacted by the Legislature of Louisiana:
13 Section 1. Part II-A of Chapter 5-E of Title 40 of the Louisiana Revised Statutes of
141950, comprised of R.S. 40:1250.1 through 1250.31, is hereby enacted to read as follows:
15PART II-A. DISABILITY SERVICE PROVIDERS: MEDICAID REIMBURSEMENT
16 SUBPART A. GENERAL PROVISIONS
17 §1250.1. Short title
18 This Part shall be known and may be cited as the "Disability Services
19 Medicaid Reimbursement Rate Act".
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1 §1250.2. Legislative findings; declaration
2 A. The legislature hereby finds all of the following:
3 (1) Access to quality services for persons with developmental, intellectual,
4 adult-onset, or physical disabilities furnished by private providers is essential for the
5 health, safety, and well being of those persons.
6 (2) Reliable and sufficient Medicaid reimbursement rates for private
7 providers are necessary to create and maintain a sustainable statewide system of
8 services for eligible individuals with disabilities.
9 (3) A statewide system of services is sustainable only if reimbursement rates
10 are sufficient to enlist providers in numbers great enough to allow eligible
11 individuals a choice among different providers who are capable of delivering quality
12 services that will meet the assessed needs of those individuals in a timely manner.
13 B. The legislature hereby declares that this state must take steps to foster and
14 maintain a robust network that attracts and retains quality providers which are
15 capable of maintaining a stable workforce and are sufficient in number to allow for
16 meaningful choices among providers by individuals eligible to receive disability
17 services.
18 §1250.3. Purposes
19 The purposes of this Part are to provide for a reliable legal framework to
20 guide the Louisiana Department of Health, or any successor state Medicaid agency,
21 in setting reimbursement rates for providers of disability services for persons with
22 developmental, intellectual, adult-onset, or physical disabilities.
23 §1250.4. Definitions
24 As used in this Part, the following terms have the meaning ascribed to them
25 in this Section:
26 (1) "Department" means the Louisiana Department of Health.
27 (2) "Direct service worker" means an individual who works directly with a
28 person with a developmental, intellectual, adult-onset, or physical disability to
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1 provide a service or a component of a service as an employee or independent
2 contractor of a provider.
3 (3) "Methodology" means the aggregate of methods, principles, assumptions,
4 variables, factors, and procedures used to determine a reimbursement rate.
5 (4) "Person-centered planning process" means a process of planning with a
6 recipient for the identification of needs and coordination and delivery of services that
7 reflect the personal preferences of the recipient.
8 (5) "Provider" means a person, public agency, nonprofit corporation, or a
9 for-profit business entity that provides services under a contract or other agreement
10 with the department.
11 (6) "Rate" means the amount of money per unit of time for a Medicaid
12 service performed or the amount of money for a Medicaid service performed for a
13 flat fee, such as a per diem.
14 (7) "Rebasing" means using cost report information to adjust Medicaid
15 reimbursement rates to the level dictated by the Medicaid reimbursement
16 methodology for each covered service.
17 (8) "Recipient" means a Medicaid-eligible person with a developmental,
18 intellectual, adult-onset, or physical disability receiving services from the department
19 or a provider.
20 (9) "Reimbursement" means payment for a Medicaid service in accordance
21 with a specified rate.
22 (10) "Restructure" means any alteration in the methodology used to
23 determine a rate.
24 (11) "Service" means a home- or community-based service, intermediate
25 care facility service, or support coordination service provided to a recipient by a
26 provider under a contract or other agreement with the department.
27 (12) "Service plan" means a plan resulting from the person-centered
28 planning process for the delivery and coordination of specific Medicaid services
29 authorized for a recipient.
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1 (13) "Staff-to-recipient ratio" means a ratio reflecting the number of direct
2 service workers designated to provide a Medicaid service for one or more recipients.
3 (14) "Stakeholder" means a recipient, a parent or guardian of a recipient, any
4 provider, and any association or organization representing or advocating on behalf
5 of providers, recipients, or parents or guardians of recipients.
6 SUBPART B. RATE DESIGN AND METHODOL OGY
7 §1250.11. Rate design
8 The department shall design all rate-setting processes and methodologies to
9 ensure that recipients have adequate access to services that satisfy all applicable
10 standards and requirements of federal and state law for efficiency, economy, and
11 quality of care. Such rate-setting processes and methodologies shall comply with the
12 procedures, standards, and requirements provided in this Part.
13 §1250.12. Rate methodology
14 A. The department shall establish all new rates or changes to rates by a
15 methodology that specifies and describes all factors, procedures, methods, and data
16 used or considered in developing the respective rates, including but not limited to
17 sources and methods of data collection, staff-to-recipient ratios, standards of
18 reliability, formulas, calculations, assumptions, and variables.
19 B. The department shall design the methodology to ensure that all rates meet
20 the sufficiency standards provided in R.S. 40:1250.14.
21 C. All data used or relied on in the methodology shall be reliable in
22 accordance with standard principles of data reliability.
23 D. The department shall ensure that its methodology results in rates that
24 satisfy all of the following conditions:
25 (1) The rates allow for all recipients to have a choice of quality providers for
26 each service offered.
27 (2) The rates allow all recipients to access services in a timely manner.
28 (3) The rates can be incorporated consistently in fee-for-service Medicaid,
29 Medicaid 1915(c) waivers, and Medicaid managed care programs.
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1 E. The department shall consider payment structures that ensure quality and
2 value and improve adequacy, access, and sufficiency.
3 F. In connection with its design and implementation of the rate methodology
4 required in this Section, the department shall develop a reporting system that
5 disaggregates data by geography and demography and features specific information
6 on access to services for population subgroups including, without limitation, people
7 with developmental, intellectual, adult-onset, or physical disabilities.
8 §1250.13. Cost data; requirements
9 All rates shall be set based on reliable data of the actual or reasonably
10 estimated costs of providing the service to be reimbursed. Such costs shall include,
11 as applicable to the rate, all employee wages, benefits, qualifications, and training
12 costs; staff-to-recipient ratios; equipment and vehicle costs; and costs of operating,
13 maintaining, and managing a residential setting including taxes, administrative costs,
14 and overhead costs, but excluding unreimbursed room and board costs.
15 §1250.14. Rate uniformity
16 Rates for similar services and supports shall be uniform in order to ensure
17 that all providers receive the same rate for the same service for individuals with the
18 same or similar needs, subject to reasonable adjustments for documented geographic
19 variations in cost data.
20 §1250.15. Rate implementation; conditions
21 Implementation of any new Medicaid reimbursement methodology as defined
22 in this Part shall be contingent upon approval by the Centers for Medicare and
23 Medicaid Services and the Joint Legislative Committee on the Budget. Additionally,
24 the department shall not implement any new Medicaid reimbursement rate developed
25 pursuant to the provisions of this Part unless the legislature makes a specific
26 appropriation for such purpose.
27 SUBPART C. MONITORING AND RATE ADJUSTMENT
28 §1250.21. Monitoring for adequacy and quality of services
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1 A. The department shall maintain reliable data in a form that permits
2 ongoing monitoring of trending factors that may affect the sufficiency of rates. Such
3 factors may include, without limitation, trends in cost of living and other economic
4 indexes, wage rates, and changes in regulatory and policy requirements affecting
5 provider costs.
6 B. The department may require reasonable, periodic financial reports from
7 providers as needed to ensure the availability of reliable cost data. The department
8 shall consult and collaborate with providers to develop reasonable financial reporting
9 requirements.
10 §1250.22. Annual review of rates
11 The department may conduct annual reviews of all rates by service category
12 and shall make a determination of the level of sufficiency of each rate based on a
13 review of all pertinent data.
14 SUBPART D. RULEMAKING
15 §1250.31. Administrative rulemaking; limitation on emergency rules
16 A. The department shall promulgate all such rules in accordance with the
17 Administrative Procedure Act as are necessary to implement the provisions of this
18 Part.
19 B. Except in cases in which the conditions for adoption of an emergency rule
20 provided in R.S. 49:953(B)(1)(a) are satisfied, the department shall promulgate all
21 rules for implementation of the provisions of this Part through the notice process
22 provided for in R.S. 49:953(A).
23 Section 2.(A) The Louisiana Department of Health shall provide a written report
24concerning disability service provider rates to the House Committee on Appropriations, the
25Senate Committee on Finance, and the legislative committees on health and welfare no later
26than forty-five days prior to the convening of the 2020 Regular Session of the Legislature
27of Louisiana. The report shall include, without limitation, all of the following information:
28 (1) Any changes within the previous twelve months to the Medicaid rate
29methodology for services provided for in Part II-A of Chapter 5-E of Title 40 of the
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1Louisiana Revised Statutes of 1950, as enacted by Section 1 of this Act, and the current
2Medicaid rates for those services.
3 (2) The date of the last rebasing of Medicaid rates for intermediate care facilities for
4people with developmental disabilities and any future dates on which those rates are due to
5be rebased.
6 (3) The amount of funding that would be required for an annual adjustment, based
7on the inflation index, to the Medicaid rates for services provided for in Part II-A of Chapter
85-E of Title 40 of the Louisiana Revised Statutes of 1950, as enacted by Section 1 of this
9Act.
10 (4) The health market basket inflation index used in calculating the amount of
11funding that would be needed for an annual adjustment of Medicaid rates for services
12provided for in Part II-A of Chapter 5-E of Title 40 of the Louisiana Revised Statutes of
131950, as enacted by Section 1 of this Act.
14 (5) Any proposed changes to the methodology for determining Medicaid rates for
15services provided for in Part II-A of Chapter 5-E of Title 40 of the Louisiana Revised
16Statutes of 1950, as enacted by Section 1 of this Act.
17 (B) Upon request of any legislative committee identified in this Section, the
18secretary of the Louisiana Department of Health or his designee shall appear in person
19before the committee to present the report required by this Section.
DIGEST
The digest printed below was prepared by House Legislative Services. It constitutes no part
of the legislative instrument. The keyword, one-liner, abstract, and digest do not constitute
part of the law or proof or indicia of legislative intent. [R.S. 1:13(B) and 24:177(E)]
HB 390 Engrossed 2019 Regular Session White
Abstract: Requires the La. Department of Health to develop Medicaid reimbursement rates
paid to providers of disability services according to certain guidelines.
Proposed law provides that its purpose is to provide for a reliable legal framework to guide
the La. Department of Health (LDH) in setting reimbursement rates for providers of
disability services for persons with developmental, intellectual, adult-onset, or physical
disabilities.
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Proposed law requires LDH to design all processes and methodologies for setting Medicaid
reimbursement rates for providers of disability services to ensure that service recipients have
adequate access to services that satisfy all applicable standards and requirements of federal
and state law for efficiency, economy, and quality of care.
Proposed law requires LDH to establish all new rates or changes to rates by a methodology
that specifies and describes all factors, procedures, methods, and data used or considered in
developing the respective rates, including but not limited to sources and methods of data
collection, staff-to-recipient ratios, standards of reliability, formulas, calculations,
assumptions, and variables. Stipulates that all data used or relied on in the methodology
shall be reliable in accordance with standard principles of data reliability.
Proposed law requires LDH to ensure that its methodology results in rates that satisfy all of
the following conditions:
(1)The rates allow for all recipients to have a choice of quality providers for each
service offered.
(2)The rates allow all recipients to access services in a timely manner.
(3)The rates can be incorporated consistently in fee-for-service Medicaid, Medicaid
1915(c) waivers, and Medicaid managed care programs.
Proposed law requires LDH to consider payment structures that ensure quality and value and
improve adequacy, access, and sufficiency.
Proposed law provides that in connection with its design and implementation of the rate
methodology required in proposed law, LDH shall develop a reporting system that
disaggregates data by geography and demography and features specific information on
access to services for population subgroups including, without limitation, people with
developmental, intellectual, adult-onset, or physical disabilities.
Proposed law requires all rates to be set based on reliable data of the actual or reasonably
estimated costs of providing the service to be reimbursed. Provides that such costs shall
include, as applicable to the rate, all employee wages, benefits, qualifications, and training
costs; staff-to-recipient ratios; equipment and vehicle costs; and costs of operating,
maintaining, and managing a residential setting including taxes, administrative costs, and
overhead costs, but excluding unreimbursed room and board costs.
Proposed law requires that rates for similar services and supports shall be uniform in order
to ensure that all providers receive the same rate for the same service for individuals with
the same or similar needs, subject to reasonable adjustments for documented geographic
variations in cost data.
Proposed law stipulates that implementation of any new Medicaid reimbursement
methodology shall be contingent upon approval by the Centers for Medicare and Medicaid
Services and the Joint Legislative Committee on the Budget. Prohibits LDH from
implementing any new Medicaid reimbursement rate pursuant to proposed law unless the
legislature makes a specific appropriation for such purpose.
Proposed law requires LDH to maintain reliable data in a form that permits ongoing
monitoring of trending factors that may affect the sufficiency of rates such as trends in cost
of living and other economic indexes, wage rates, and changes in regulatory and policy
requirements affecting provider costs.
Proposed law authorizes LDH to require reasonable, periodic financial reports from
providers as needed to ensure the availability of reliable cost data. Requires LDH to consult
and collaborate with providers to develop reasonable financial reporting requirements.
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Proposed law authorizes LDH to conduct annual reviews of all rates by service category and
make a determination of the level of sufficiency of each rate based on a review of all
pertinent data.
Proposed law requires LDH to provide a written report concerning disability service provider
rates to the House Committee on Appropriations, the Senate Committee on Finance, and the
legislative committees on health and welfare no later than 45 days prior to the convening of
the 2020 R.S. Specifies content that the department shall include in the report.
(Adds R.S. 40:1250.1-1250.31)
Summary of Amendments Adopted by House
The Committee Amendments Proposed by House Committee on Health and Welfare to
the original bill:
1. Revise the short title of proposed law to provide that it shall be known as the
"Disability Services Medicaid Reimbursement Rate Act".
2. Delete legislative finding from proposed law indicating that, historically,
instabilities in provider networks and systems of services in various states
resulted in decades of litigation in federal courts challenging reimbursement rates
set by state Medicaid agencies for providers of disability services.
3. Delete proposed law providing that its intent is to supplement the requirements
of Medicaid law applicable to reimbursement rates for services provided to
persons with disabilities.
4. Delete provisions relative to construction of proposed law.
5. Replace all instances of "age-related disability" with "adult-onset disability".
6. Replace all instances of "direct support professional" with "direct service
worker".
7. Replace all instances of "personal planning" with "person-centered planning".
8. Specify that certain services and reimbursement rates referred to in proposed law
are Medicaid services and reimbursement rates.
9. Delete proposed law requiring the La. Department of Health (LDH) to consider
innovative rate and payment structures designed to promote improvements in
quality, adequacy, access, and sufficiency, and develop measures to assess the
effectiveness of such rate and payment structures.
10.Revise proposed law relative to establishment of rate methodologies to require
that LDH establish all new rates or changes to rates by a methodology that
specifies and describes all factors, procedures, methods, and data used or
considered in developing the respective rates.
11.Delete proposed law stipulating that no cost data that is more than two years old
shall be deemed reliable.
12.Delete proposed law requiring LDH to ensure that its rates for disability services
satisfy the following conditions:
(a)The rates allow services to be provided in the most integrated setting for
recipients, consistent with the holdings of the Supreme Court in
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Olmstead v. L.C., 527 U.S. 581 (1999), and the Americans with
Disabilities Act.
(b)The rates are sufficient to enlist a range of willing providers who are able
to retain a qualified and stable workforce and take into account all other
applicable workforce measures provided in proposed law.
(c)The rates are subject to a review process that includes input from
stakeholders and assesses the adequacy of access to services financed by
the rates.
13.Stipulate that the LDH rates for disability services be developed such that they
can be incorporated consistently in Medicaid 1915(c) waivers and Medicaid
managed care programs.
14.Stipulate that implementation of any new Medicaid reimbursement methodology
shall be contingent upon approval by the Centers for Medicare and Medicaid
Services and the Joint Legislative Committee on the Budget.
15.Prohibit LDH from implementing any new Medicaid reimbursement rate
pursuant to proposed law unless the legislature makes a specific appropriation
for such purpose.
16.Delete requirement that LDH maintain reliable data in a form that permits
ongoing monitoring of certain factors that may be indicators of the adequacy of
access to and quality of services that are subject to reimbursement rates.
17.Delete a requirement that LDH conduct annual review of all rates by service
category and instead authorize the department to conduct such reviews.
18.Delete requirements that LDH do the following:
(a)Rebase rates at least once every two years using the most recent audited
cost report data available per the prescribed reimbursement methodology
calculations for each covered service.
(b)Trend reimbursement rates forward annually for all years between rate
rebasing using the appropriate health market basket inflation index.
19.Revise reporting requirements provided in proposed law to require that LDH
provide a written report concerning disability service provider rates to the House
Committee on Appropriations, the Senate Committee on Finance, and the
legislative committees on health and welfare no later than 45 days prior to the
convening of the 2020 R.S., and to specify the content of the report.
20.Make technical changes.
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