PURPOSE AND EFFECT: The purpose of the proposed amendment is to incorporate changes to the Payment Methodology for Participating Medicaid Managed Health Care Plans, effective July 1, 2005, to provide the following changes based on the 2005-06 ...

 

AGENCY FOR HEALTH CARE ADMINISTRATION

Medicaid

RULE NO.: RULE TITLE:

59G-8.100 Medicaid Contracts for Prepaid Health Plans

PURPOSE AND EFFECT: The purpose of the proposed amendment is to incorporate changes to the Payment Methodology for Participating Medicaid Managed Health Care Plans, effective July 1, 2005, to provide the following changes based on the 2005-06 General Appropriations Act, Specific Appropriations 225, 226, Senate Bill 838, Section 20, and Section 409.9124, F.S.

1. Section B (4): Discount Factor (D) – equals the percentage of the projected payment limit that is allocated to each service area as referenced in Table 2.

2. Section B (6) Payment Limit (PL) – means the projected cost for HMO covered services in a Medicaid fee-for-service system, including MediPass costs and fee-for-service costs attributable to recipients enrolled for a portion of a year in a managed care plan or waiver program, but excluding the fee paid to primary care physicians for MediPass enrollees, actual expenditures for children enrolled for reimbursement under the CMS program, and other excluded groups as described in Section 10.3 of the HMO contracts. The final capitation rate paid to HMOs is calculated as a percentage of the PL by taking into consideration age and gender factors, service area, other discount factors, and eligibility category expenditures. Pursuant to 42 CFR 438.6, the final capitation rates must be actuarially sound. Medicaid payment for a defined scope of services to be furnished to a defined number of recipients may not exceed the cost to the agency of providing those same services on a fee-for-service basis to an actuarially equivalent population group.

Section 409.9124, F.S., limits the projected weighted rate on a per member per month basis to the per member per month rate adopted by the Florida Legislature.

3. Section B (7) Service Categories or HMO Capitation Categories mean:

Hospital/ Medical Services – all HMO covered services not falling into the three other HMO capitation categories specified in subparagraph 5.b., c., and d. These include: hospital inpatient, hospital outpatient, physician services, prescribed medicine, lab and x-ray, family planning, home health services, EPSDT Screening, child vision, child hearing, nurse practitioner, birthing center, rural health services, physical therapy, speech therapy, occupational therapy, respiratory therapy, clinic, physician assistant, dialysis center services, and Medicare dual eligible crossover expenditures.

4. Section C (1): AP – equals amount paid for HMO covered services rendered under the MediPass program, minority networks, Emergency Room Diversion and other related projects, and the standard Medicaid fee-for-service system for SFY 1 and SFY 2 the most recent two years available for eligibility groups, age and gender bands, and service areas equivalent to the managed care population.

5. Section C (1): IBNR – equals an estimated percentage of the total amount of claims incurred during the applicable fiscal year that have not yet been submitted to the Agency for Health Care Administration (agency). This calculation is based upon an evaluation of SFY 1. As the expenditures in each SFY of the base include the 12 months of the referenced year (months 1-12) plus the following 6 months (months 13-18), the evaluation for the period of claims incurred but not reported includes claims paid from 19-30 months after the beginning of SFY 1. This evaluation is determined statewide and includes all covered service categories.

6. Section C (1): TPL – equals third party liability recovery adjustments, which is the Agency’s estimated percentage of third party liability recovery based on the average of the actual amounts recovered for SFY 1 and SFY 2.

7. Section C (2): Step 1

Eligibility Group	Age/Gender Bands (age in years unless otherwise noted)
	Months 0-2 Months 3-11 1-5 6-13 14-20 Male	14-20 Female 21-54 Male 21-54 Female 55 and over
SSI – no Medicare	Months 0-2 Months 3-11 1-5 6-13	14-20 21-54 55 and over
SSI Medicare Part A and B	Under 65	65 and over
SSI Medicare Part B only	All ages combined

8. Section C: Step 4 IBNR Claims: A certain percentage of claims are paid after each year’s data is summarized. The agency summarizes each state fiscal year of data six months after it ends. The IBNR adjustment reflects an estimate of the claims that will be paid after December 31, for SFY 2 incurred but not reported claims. The estimated claims amount is added to the expenditures for combined SFY 1 and SFY 2 to reflect the total fee-for-service costs.

9. Section C: Step 4 Third Party Liability (TPL) Adjustment: The claims data does not include all of the TPL recoveries realized by the agency. Based on an average of SFY 1 and SFY 2 TPL data, the SFY 4 cost estimates are adjusted downward to reflect the TPL recoveries. This adjustment includes only those recoveries that are not already reflected in the claims data. The TPL adjustment factors are calculated separately for each eligibility category, and may vary annually.

10. Section E: TA – the trend adjustment necessary to remain within Section 409.9124, F.S. The final weighted rate for all eligibility groups shall not exceed the per member per month amount adopted by the Florida Legislature.

SUMMARY: The proposed amendment to Rule 59G-8.100, F.A.C., revises the Payment Methodology for Participating Medicaid Managed Health Care Plans, as incorporated into Rule 59G-8.100, F.A.C., by reference.

SUMMARY OF statement of ESTIMATED REGULATORY COSTS: No Statement of Estimated Regulatory Cost was prepared.

Any person who wishes to provide information regarding a statement of estimated regulatory costs, or provide a proposal for a lower cost regulatory alternative must do so in writing within 21 days of this notice.

SPECIFIC AUTHORITY: 409.9124 FS., 409.919 FS.

LAW IMPLEMENTED: 409.9124(1) FS.

IF REQUESTED WITHIN 21 DAYS OF THE DATE OF THIS NOTICE, A HEARING WILL BE HELD AT THE DATE, TIME AND PLACE SHOWN BELOW (IF NOT REQUESTED, THIS HEARING WILL NOT BE HELD):

DATE AND TIME: February 14, 2006, 10:00 a.m.

PLACE: Agency for Health Care Administration, 2727 Mahan Drive, Building 3, Conference Room B, Tallahassee, FL 32308

THE PERSON TO BE CONTACTED REGARDING THE PROPOSED RULE IS: Edwin Stephens, Medicaid Program Analysis, Agency for Health Care Administration, 2727 Mahan Drive, Building 3, Room 2149A, Mail Stop 21, Tallahassee, Florida 32308, [phone]

 

THE FULL TEXT OF THE PROPOSED RULE IS:

 

59G-8.100 Medicaid Contracts for Prepaid Health Plans.

(1) through (16) No change.

(17) Payment Methodology for Covered Services. Capitation payment rates are calculated annually by the agency based on historical fee-for-service expenditures adjusted forward to the contract period. The agency shall not pay more for a defined scope of services to a defined number of enrollees under a capitation arrangement than the projected cost of providing those same services on a fee-for-service basis. The payment methodology, entitled “Agency for Health Care Administration, Payment Methodology for Participating Medicaid Managed Health Care Plans”, July 20054 is incorporated herein by reference.

(18) through (24) No change.

Specific Authority 409.9124, 409.919 FS. Law Implemented 409.9124(1) FS. History–New 3-9-81, Amended 7-9-84, Formerly 10C-7.524, Amended 4-5-89, Formerly 10C-7.0524, Amended 8-4-02, 1-23-05, ________.

 

NAME OF PERSON ORIGINATING PROPOSED RULE: Mr. Robert Butler

NAME OF SUPERVISOR OR PERSON WHO APPROVED THE PROPOSED RULE: Mr. Robert Butler

DATE PROPOSED RULE APPROVED BY AGENCY HEAD: January 9, 2006

DATE NOTICE OF PROPOSED RULE DEVELOPMENT PUBLISHED IN FAW: August 5, 2005