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Iowa SPA 05-012

By Manuel Rodriguez,2014-06-28 09:37
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Iowa SPA 05-012 ...

    Iowa SPA 05-012

    Response for Additional Information (RAI)

1. Please explain the State’s rationale for including this nursing facility change in

    Section 4.19-D of the State Plan. How does this proposed change affect

    reimbursement methodologies? Will the State’s reimbursement for nursing

    facility admissions be increased to address the more sever impairment of

    cognitive skills or increased assistance with the activities of daily living of the

    residents?

    Response: This requested state plan change was included in this section as the

    state was uncertain of the proper placement for this language. We requested from

    CMS staff the appropriate placement in the SPA and to date have not received a

    response. Therefore we placed the language in 4.19D. If this language should be

    placed in another section, Iowa is willing to submit the necessary change.

    Placement of this language in 4.19 D does not intend the reimbursement

    methodology to be changed. The proposed changes do not affect reimbursement

    methodologies.

2. Because these changes appear to modify coverage of nursing facility coverage,

    please explain the State’s basis for not including these 4.19-D changes in other

    sections such as 3.1-A of the plan for service coverage for the categorically needy

    population and 3.1-B for the medically needy population.

    Response: Iowa does not intend to modify coverage of nursing facility coverage.

    We requested from CMS staff the appropriate placement in the SPA and to date

    have not received a response. Therefore we placed the language in 4.19D. If this

    language should be placed in another area, Iowa is willing to submit the necessary

    changes.

3. The State proposes to impose limits on the provision of nursing facility care and

    limit access to the nursing facility benefit. The nursing facility benefit is

    mandatory under Medicaid as stated in 1919 of the Social Security Act (the Act).

    Please document the State’s legal analysis for using prior authorization to waive

    immediate access to mandatory Medicaid services. Specifically, please address

    the following:

a) On page 3 of the State’s August 30, 2005 justification, Iowa claims “Nursing

    facility services will continue to remain an entitlement if home and community-

    based waiver services are unavailable due to limitation on slots.”

     Response: This third set of questions and concerns starts by characterizing the

    State’s proposed SPA as proposing “to impose limits on the provision of nursing

    facility care and limit access to the nursing facility benefit ” by “using prior

    authorization to waive immediate access” to nursing facility services.

    We would clarify that the SPA does not use prior authorization. Rather, it

    modifies the State’s nursing facility level of care determination criteria. The

    federal regulations require that states have a level of care process to determine the

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need for nursing facility services. See 42 C.F.R. ? 456.370. However, the federal

    regulations do not specify the criteria to be used in the level of care determination.

    Therefore, the State has discretion to set reasonable standards, and to make

    reasonable changes.

As stated in our letter of August 30, the proposed SPA updates Iowa’s level of

    care criteria by explicitly taking into account home and community-based services,

    where they are available and can meet the individual’s needs. But the level of

    care determination process is not a prior authorization process, because the level

    of care determination may be made after the nursing facility begins to render

    services (in instances where the beneficiary enters the facility as private pay, then

    requests Medicaid funding when funds exhausted). And the level of care process

    does not “impose limits on the provision of nursing facility care,” “limit access to

    the nursing facility benefit,” or “waive immediate access” to the mandatory

    Medicaid service of nursing facility care except where the nursing facility

    services are determined not to be needed.

i) Please explain how the State legally justifies that nursing facility services will

    not be an entitlement if Home and Community Based (HCBS) services are

    available.

    Response: At (3)(a) you note the statement in our August 30 letter that

    “[n]ursing facility services will continue to remain an entitlement if home and

    community-based waiver services are unavailable due to limitations on slots.”

    You then ask that we explain “how the State legally justifies that nursing facility

    services will not be an entitlement if Home and Community-Based (HCBS)

    services are available.”

All “entitlements” to medical care and services under the Medicaid program are

    subject to the requirement that there be a need for the care or services. As stated

    in our August 30 letter, we recognize that nursing facility services are mandatory

    Medicaid services. In that sense they are an “entitlement” for all individuals

    eligible for Medicare benefits. But that does not mean that nursing facility

    services must be available on demand, regardless of need. On the contrary, the

    Social Security Act also mandates that states “provide such methods and

    procedures relating to the utilization of, and payment for, care and services

    available under the plan … as may be necessary to safeguard against unnecessary

    utilization of such care and services.” Section 1902(a)(30)(A). Federal Medicaid

    regulations explicitly provide that a state “may place appropriate limits on a

    service based on such criteria as medical necessity or on utilization control

    procedures.” 42 C.F.R. ? 440.230(d). Regarding nursing facility services, the

    regulations further require that before payment can be authorized, an

    interdisciplinary team of health professionals must make a comprehensive

    evaluation of the need for nursing facility services, including an evaluation of “the

    resources available in the home, family, and community.” 42 C.F.R. ? 456.370(a),

    (c)(7).

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    The proposed SPA follows the requirement that the evaluation of the need for

    nursing facility services must including an evaluation of the resources available in

    the community by providing that it will include an evaluation of the resources

    available through the HCBS waiver programs. If home and community-based

    waiver services are available and would meet the individual’s needs, then

    payment will not be made for nursing facility services (until after a one year trial

    of home and community-based services). This denial of payment is legally

    justified by the provisions cited above requiring states to “safeguard against

    unnecessary utilization,” allowing states to “place appropriate limits on a service,”

    and requiring a comprehensive evaluation of need before payment is made for

    nursing facility services.

    ii) Please explain how the State will address issues where HCBS waiver slots are

    available but services in a particular community are not available.

    Response: If a slot is available, but the services in a particular community are

    not available, the state Medicaid program will pay for nursing facility services

    needed in the absence of home and community based services, based on

    current level of care criteria.

    iii) 1902 and 42 CFR 440.230 (b), (c), and (d) require the State to provide each

    service in sufficient amount, duration, and scope to reasonably achieve its

    purpose. In addition, the State may not arbitrarily deny or reduce the amount,

    duration, or scope of a required service to an otherwise eligible recipient

    solely because of diagnosis, type of illness, or condition. Finally, the agency

    may place appropriate limits on a service based on criteria as medical

    necessity or on utilization control procedures.

    Please explain for the State Plan service of nursing facility services, how the

    State will provide each service in sufficient amount, duration, and scope to

    reasonably achieve its purpose, if it is no longer allowing individuals who

    have been assessed to need this level of care in an alternative setting (HCBS)

    to access it directly.

     Response: As discussed above, the State has discretion to set reasonable

    level of care criteria for nursing facility services, and to change those criteria. By

    considering the availability of waiver services in the nursing facility level of care

    determination, the State believes the new criteria in the proposed SPA will do a better

    job of assuring that both nursing facility and home and community-based services are

    sufficient in amount, duration, and scope to reasonably achieve their purpose. The

    State should not be precluded from changing its level of care criteria simply because

    individuals previously considered to meet the level of care requirements for nursing

    facility services will not meet the new criteria. Level of care determinations for

    nursing facility and home and community-based services have always contained an

    element of contradiction. As part of the waiver eligibility process, individuals are

    determined to “need” nursing facility services. But then they do not receive nursing

    facility services. Yet their needs are met. The proposed SPA simply acknowledges

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    that individuals who would need nursing facility services in the absence of waiver

    services do not need nursing facility services if waiver services are available.

    b) 1915(c)(1) and 1915(c)(2)(B)(i) of the Act both require that recipients of HCBS

    services have “a determination that but for the provision of such services the

    individuals would require the level of care provided in a hospital or a nursing

    facility or intermediate care facility for the mentally retarded the cost of which

    could be reimbursed under the State plan.” (1915(c)(1))

    i) According to statute, both HCBS and nursing facility are required to have the

    same Level of Care (LOC) requirements. In light of this requirement, please

    justify the SPA proposal that recipients of HCBS services with LOC less than

    the nursing facility LOC will have a determination that meets the new higher

    nursing facility LOC criteria.

    Response: At (3)(b) you note the requirement of 1915(c)(1) that recipients of

    HCBS services have “a determination that but for the provision of such services

    the individuals would require the level of care provided in a hospital or a nursing

    facility or intermediate care facility for the mentally retarded the cost of which

    could be reimbursed under the State plan.” You then characterize this as a

    requirement that “both HCBS and nursing facility are required to have the same

    Level of Care (LOC) requirements” and request that we “justify the SPA proposal

    that recipients of HCBS services with LOC less than the nursing facility LOC will

    have a determination that meets the new higher nursing facility LOC criteria.”

Because this question is based on the HCBS waiver requirements, we believe that

    it would be more appropriately addressed in the context of State’s HCBS waivers

    than in the present context of the State’s proposed SPA regarding nursing facility

    level of care criteria. Nonetheless, we will address it here.

We believe that the characterization of the statutory provision as requiring the

    same level of care criteria for both nursing facility and home and community-

    based services is an oversimplification. As quoted above, the statute actually

    provides that home and community-based services may be provided to an

    individual “with respect to whom there has been a determination that but for the

    provision of such services the individuals would require the level of care provided

    in a hospital or a nursing facility or intermediate care facility for the mentally

    retarded the cost of which could be reimbursed under the State plan.” Because

    the State’s proposed SPA allows continued use of the current level of care criteria

    for nursing facility services if waiver services are unavailable (due to a lack of

    slots or providers), it will still be the case that the State will provide waiver

    services only to individuals who otherwise would require a nursing facility level

    of care which “could” be reimbursed under the state plan, if waiver services were

    unavailable. Reading in the “if waiver services were unavailable” is appropriate

    because the test is the level of care required “but for” the provision of waiver

    services” and because, as noted above, the regulations otherwise require that the

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level of care determination for nursing facility services must take into account

    resources available in the community. See 42 C.F.R. ? 456.370(c)(7).

    c) 1915(c)(2)(C) requires that individuals who are determined to be likely to require

    the level of care provided in a hospital, nursing facility, or ICF-MR are informed

    of the feasible alternatives, if available under the waiver, at the choice of such

    individuals, to the provision of inpatient hospital services, nursing facility

    services, or services in an ICF-MR.

    i) According to statute, beneficiaries will retain a choice between nursing

    facility and feasible alternatives. Please explain the legal rationale for the

    State of Iowa denying beneficiaries this choice and requiring them to receive

    waiver services in the community for one year.

     Response: At (3)(c) you note the requirement of 1915(c)(2)(C) that

    “individuals who are determined to be likely to require the level of care provided

    in a hospital, nursing facility, or intermediate care facility for the mentally

    retarded are informed of the feasible alternatives, if available under the waiver, at the choice of such individuals, to the provision of inpatient hospital services,

    nursing facility services, or services in an intermediate care facility for the

    mentally retarded.” You then characterize the statute as requiring that

    beneficiaries retain a choice between nursing facility services and waiver

    alternatives, and ask that we explain the legal rationale for the State denying

    beneficiaries this choice and requiring them to receive waiver services in the

    community for one year.

Again, this question based on HCBS waiver requirements would be more

    appropriately addressed in the context of the state’s HCBS waivers than in the

    present context of the State’s proposed SPA regarding nursing facility level of

    care criteria.

That said, the focus of 1915(c)(2)(C) is on informing individuals of the

    alternatives to institutionalization under the State’s waiver, not on giving them the choice of being institutionalized. As discussed above, the choice of services

    under the Medicaid program is always circumscribed by the required safeguards

    against unnecessary utilization. The reference in 1915(c)(2)(C) to “the choice of

    such individuals” should be no exception but should also be subject to safeguards

    against unnecessary utilization.

With regard to the choice between institutionalization and home and community-

    based services, Iowa’s limits on the home and community-based services

    available under its waivers guarantee that any home and community-based waiver

    services covered will be substantially less costly than institutionalization. See 441 Iowa Admin. Code 83.2(2)(b), 83.22(2)(b), 83.42(2)(b), 83.82(2)(d), 83.102(2)(b).

    Given the cost limits, any home and community-based waiver services covered

    will also constitute less intense utilization of medical services and resources,

    saving those services and resources for others whose needs cannot be met by

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home and community-based services within Iowa’s waiver limits. For these

    reasons, it should be permissible for the State to limit a beneficiary’s choice to

    less costly and less intensive home and community-based services, where they are

    available and will meet the beneficiary’s needs, in lieu of institutionalization.

ii) How will this counseling regarding feasible alternatives be changed? What

    information regarding choices will be given to beneficiaries under the

    proposal? How will this choice counseling occur under the proposal? Who

    will perform this choice counseling?

    Response: Iowa is preparing to enhance the process in which feasible

    alternatives are explained to beneficiaries. The current process allows for

    the income maintenance worker, service worker and/or case manager to

    address possible alternatives for the member. With the new process, Iowa

    will have the opportunity to enhance the manner in which the member is

    provided feasible alternatives. With the involvement of the nurse reviewer

    completing a face-to-face assessment to determine level of care, a medical

    perspective is added into the discussion of feasible alternatives in the

    community. The discussion will include explanation of Iowa’s HCBS

    waiver programs, the services included in those waivers, and the

    availability of the particular services in the community. This discussion

    will occur with all beneficiaries, whether they meet the level of care for

    nursing facility, or level of care for HCBS.

iii) The proposed SPA would leave no (zero) institutional costs as alternatives to

    be used in computing cost neutrality for the State’s 1915(c) waiver for LOC

    less than the new higher nursing facility care criteria. How is the State

    proposing to modify the 1915(c) cost neutrality for this proposal?

    Response: Again, this question based on HCBS waiver requirements

    would be more appropriately addressed in the context of the state’s HCBS

    waivers than in the present context of the State’s proposed SPA regarding

    nursing facility level of care criteria. The Sate would be willing to

    consider methods to adjust the cost neutrality calculation to reflect the

    lower-cost individuals diverted from nursing facility to home and

    community-based services by the change to the nursing facility level of

    care criteria.

    d) On page 3 of the August 30, 2005 analysis, Iowa states that “A process is being

    developed to track members who are admitted to nursing facilities when services

    are not immediately available in the community. This process will include the

    IME nurse review staff following up with the members, family members and

    facility staff on the desire for community-based services and status of service

    availability in the community to meet the member’s needs.” On page 4 of the

    same document, Iowa states “The State recognizes that for some individuals, until

    services are available in the community, the nursing facility care will be

    provided.”

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i) Will residents initially placed in a nursing facility due to a lack of access to

    HCBS services be reevaluated and required to leave the nursing facility care

    if HCBS services become available?

     Response: Residents who meet the new level of care criteria only because

    of a lack of access to home and community-based services will be re-evaluated

    for LOC in 90 days and will not be required to leave the facility. However, they

    will continue to be considered to meet level of care for nursing facility services,

    even if home and community-based services become available and Medicaid will

    continue to pay for the nursing facility services. The IME nurse reviewer will

    have continued contact with the member/family and the facility staff regarding

    desire to return to community services. If the member elects to return to

    community services the IME nurse reviewer will monitor progress for discharge.

ii) The State makes available the nursing facility benefit depending upon the lack

    of availability of Medicaid home and community-based waiver services

    (HCBS) under section 1915(c) of the Act. How does the State intend to assure

    comparability of nursing facility services under the plan given the following:

    ? The HCBS program is optional with the State. The provision of HCBS is

    not mandatory, as is the provision of nursing facility services;

    ? HCBS are available only through waivers;

    ? HCBS waivers are finite duration (3 or 5 years), and contain limits on the

    number of individuals who may be served; and

    ? HCBS waivers are granted (and continue in force) only at the discretion of

    the Secretary?

    (a) Iowa limits participation in some of its HCBS waivers by county.

    While this is permissible under section 1915(c) of the Act (which

    allows for a waiver of statewideness), please explain how this

    restriction would allow for statewide administration of the nursing

    facility benefit, which is required under section 1902 (a)(1) of the Act

    to be provided statewide.

    (b) Federal regulations at 42 CFR 440.220 provide that home health

    services are a mandatory benefit for all individuals “who are entitled”

    to receive nursing facility services under the plan. How will the

    restriction of the nursing facility benefit affect the State’s provision of

    home health services under the plan? Will individuals who are no

    longer eligible for nursing facility services also be removed from the

    group “entitled” to home health services?

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    Response: We do not understand the reference to “comparability of

    nursing facility services” in this context. Please provide further

    explanation of the question and we will then prepare a response to

    accurately address the concerns identified.

4. If the State is not permitted to use prior authorization to ultimately require a

    beneficiary to enroll in HCBS at levels of care less than the new nursing facility

    level of care, would the State be willing to implement its proposed program and

    allow beneficiaries to exercise free choice in receiving services from a nursing

    facility?

    Response: We understand the question to be whether the State would be

    willing to modify its proposal to allow all persons found to meet level of

    care for waiver eligibility purposes the choice of receiving nursing facility

    services. If Iowa correctly understands the question, the result would be

    no different than what is in place today.

    As discussed above, it should be noted that the state is not proposing a

    prior authorization process . Further, the level of care determination

    would occur in person with a nurse reviewer conducting an assessment.

    Then with the results of the level of care determination, the nurse reviewer

    would discuss the program and service options available to meet the

    individual’s needs based on the level of care identified from completing

    the assessment.

We acknowledge receipt of the State’s August 30, 2005 responses to the five standard

    funding questions CMS is asking on all reimbursement State Plan Amendments.

    However, CMS has recently revised the second standard funding question regarding how

    the state share of each type of Medicaid payment is funded. Please provide an updated

    response to the following question in relation to all payments made to all providers under

    Attachment 4.19-D of your State plan.

5. Section 1902(a)(2) provides that the lack of adequate funds from local sources

    will not result in lowering the amount, duration, scope, or quality of care and

    services available under the plan. Please describe how the state share of each

    type of Medicaid payment (normal per diem, supplemental, enhanced, other) is

    funded. Please describe whether the state share is from appropriations from the

    legislature, through intergovernmental transfer agreements (IGTs), certified

    public expenditures (CPEs), provider taxes, or any other mechanism used by the

    state to provide state share. Please provide an estimate of total expenditure and

    State share amounts for each type of Medicaid payment. If any of the non-federal

    share is being provided using IGTs or CPEs, please fully describe the matching

    arrangement including when the state agency receives the transferred amounts

    from the local government entity transferring the funds. If CPEs are used, please

    describe the methodology used by the state to verify that the total expenditures

    being certified are eligible for Federal matching funds in accordance with 42

    CFR 433.51(b). For any payment funded by CPEs or IGTs, please provide the

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    following, (i) a complete list of the names of entities transferring or certifying

    funds, (ii) the operational nature of the entity (state, county, city, other), (iii) the

    total amounts transferred or certified by each entity, (iv) clarify whether the

    certifying or transferring entity has general taxing authority and, (v) whether the certifying or transferring entity received appropriations (identify level of appropriations).

    Response: Iowa does not use CPE's or IGT as the non-federal match for facility

    expenditures.

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