(a)Introduction. This section describes the circumstances
under which HHSC directs an MCO to provide a uniform percentage rate
increase to hospitals in the MCO's network in a designated service
delivery area (SDA) for the provision of inpatient services,
outpatient services, or both. This section also describes the methodology
used by HHSC to calculate and administer such rate increase.
(b)Definitions. The following definitions apply when
the terms are used in this section. Terms that are used in this and
other sections of this subchapter may be defined in §353.1301
of this subchapter (relating to General Provisions).
(1) - (5)(No change.)
(6)Program period--A period of time for which HHSC
will contract with participating MCOs to pay increased capitation
rates for the purpose of provider payments under this section. Each
program period is equal to a state fiscal year beginning September
1 and ending August 31 of the following year. An SDA [A
service delivery area] that is unable to participate in the
program described in this section beginning September 1 may apply
to participate beginning March 1 of the program period and ending
August 31. Participation during such a modified program period is
subject to the application and intergovernmental-transfer deadlines
described in subsection (g) of this section.
(7)Rural private hospital--A privately-operated hospital
that is a rural hospital as defined in §355.8052 of this title
(relating to Inpatient Hospital Reimbursement). [located
in a county with 60,000 or fewer persons according to the most recent
United States Census, a Medicare-designated rural referral center,
a sole community hospital, or a critical access hospital.]
(8)Rural public hospital--A hospital that is owned
and operated by a governmental entity and is a rural hospital
as defined in §355.8052 of this title. [located in
a county with 60,000 or fewer persons according to the most recent
United States Census, a Medicare-designated rural referral center,
a sole community hospital, or a critical access hospital.]
(9) - (10)(No change.)
(c)Classes of participating hospitals.
(1)HHSC may direct the MCOs in an SDA [a
service delivery area] that is participating in the program
described in this section to provide a uniform percentage rate increase
to all hospitals within one or more of the following classes of hospital
with which the MCO contracts for inpatient or outpatient services:
(A) - (G)(No change.)
(2)If HHSC directs rate increases to more than one
class of hospital within the SDA [service delivery
area], the percentage rate increases directed by HHSC may vary
between classes of hospital.
(d)Eligibility. HHSC determines eligibility for rate
increases by SDA [service delivery area] and
class of hospital.
(1)Service delivery area. Only hospitals in an
SDA [a service delivery area] that includes at least
one sponsoring governmental entity are eligible for a rate increase.
(2)Class of hospital. HHSC will identify the class
or classes of hospital within each SDA [service delivery
area] described in paragraph (1) of this subsection to be eligible
for a rate increase. HHSC will consider the following factors when
identifying the class or classes of hospital eligible for a rate increase
and the percent increase applicable to each class:
(A) - (C)(No change.)
(e)Services subject to rate increase. HHSC may direct
the MCOs in an SDA [a service delivery area]
to increase rates for all or a subset of inpatient services, all or
a subset of outpatient services, or all or a subset of both, based
on the service or services that will best advance the goals and objectives
of HHSC's quality strategy.
(f)Determination of percentage of rate increase.
(1) - (2)(No change.)
(3)After determining the percentage of rate increase
using the process described in paragraphs (1) and (2) of this subsection,
HHSC will modify its contracts with the MCOs in the SDA [
service delivery area] to direct the percentage rate increases.
(g)Application process; timing and amount of transfer
of non-federal share.
(1)The stakeholders in an SDA [a service
delivery area] initiate the request for HHSC to implement a
uniform hospital rate increase program by submitting an application
using a form prescribed by HHSC.
(A)The stakeholders in the SDA [service
delivery area], including hospitals, sponsoring governmental
entities, and MCOs, are expected to work cooperatively to complete
the application.
(B) - (D)(No change.)
(2)Sponsoring governmental entities must complete
the IGT for the first six months of the program period no later than
four months prior to the start of the program period, unless otherwise
instructed by HHSC. For example, for the program period beginning
September 1, 2017, HHSC must receive the IGT for the first six months
no later than May 1, 2017; for the modified program period beginning
March 1, 2018, HHSC must receive the IGT no later than November 1,
2017.
(3)Following the transfer of funds described in paragraph
(2) of this subsection, sponsoring governmental entities must transfer
additional IGT at such times and in such amounts as determined by
HHSC to be necessary to ensure the availability of funding of the
non-federal share of the state's expenditures under this section and
HHSC's compliance with the terms of its contracts with MCOs in the SDA
[service delivery area]. In no event may transfers
for directed increases in a program period occur later than November
1 of the calendar year.
(4)HHSC will instruct sponsoring governmental entities
as to the required IGT amounts. Required IGT amounts will include
all costs associated with the uniform rate increase, including costs
associated with premium taxes, risk margins, and administration, plus
ten percent.
(h) - (j)(No change.)
(k)December 2017 limited eligibility.
Notwithstanding the other provisions of this section, any SDA that
received approval from CMS by April 15, 2017, may participate in the
program described in this section for dates of service beginning December
1, 2017. Sponsoring governmental entities must complete the IGT for
the period of December 1, 2017, through February 28, 2018, by a date
to be determined by HHSC.
The agency certifies that legal counsel has reviewed
the proposal and found it to be within the state agency's legal authority
to adopt.
Filed with the Office
of the Secretary of State on August 14, 2017
TRD-201703131 Karen Ray
Chief Counsel
Texas Health and Human Services Commission
Earliest possible date of adoption: September 24, 2017
For further information, please call: (512) 730-7450
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