The Texas Health and Human Services Commission (HHSC) adopts amendments to §§355.101-355.111 in its Medicaid Reimbursement Rates chapter. The amendments to §§355.102, 355.103, 355.105, and 355.106 are adopted with changes to the proposed text published in the May 28, 2004, issue of the Texas Register (29 TexReg 5167). The amendments to §§355.101, 355.104, and 355.107-355.111 are adopted without changes to the proposed text.

HHSC is adopting these amendments to make the rules consistent and applicable to all long term care programs operated by the Texas Department of Human Services (DHS) and the Texas Department of Mental Health and Mental Retardation (TDMHMR) that are required to submit cost reports used in rate determination. The amendments create one set of rules for staff, providers, cost report preparers, and auditors to use in the preparation, auditing, and processing of cost reports for long term care programs. HHSC is also adopting the amendments to replace references to DHS with references to HHSC where appropriate. These changes were necessitated by the implementation of House Bill 2292, 78th Texas Legislature, which centralized authority and responsibility for all health and human services programs' rate payments with HHSC.

HHSC received three written comments from the Private Provider's Association of Texas. A summary of the comments and HHSC's responses follow.

Comment: Concerning §355.102(d)(2), §355.102(g)(2), §355.102(h)(2), §355.102(j)(1)(D)(iii)(II), §355.105(b)(2), §355.105(b)(2)(A)(iv), §355.105(b)(4)(B)(ii), §355.105(b)(4)(C)(ii), §355.105(f)(2), §355.106(a)(2), and §355.106(f)(2), community-based Intermediate Care Facilities for Persons with Mental Retardation, Home and Community-based Services, and Texas Home Living programs closely parallel the Texas Department of Human Services community programs and as a result administrative contract violation rules should apply to these programs as opposed to a vendor hold.

Response: HHSC agrees with this comment and has modified the language in these paragraphs, clauses, and subclause to apply the administrative contract violation rules to these programs.

Comment: Concerning §355.103(b)(2)(A)(i)(II), this rule indicates that allowable owner's salary is the amount paid for comparable services; however, the program-specific rules state that the owner's salary is the lesser of the amount of salary paid or the salary amount assumed in the rate model. We support this change.

Response: Language has been added to §355.103(b)(2) to clarify that, in cases where the program-specific rules contains specific salary limits or caps, those salary limits or caps apply.

An additional comment was received that did not apply to the rule proposal.

HHSC also initiated minor editorial changes to the text of §355.103(b) in paragraphs (9)(D)(iii), (13)(A)(i), and (16)(A)(ii) to clarify and improve the accuracy of the sections.

The amendments are adopted under the Government Code, §531.033, which authorizes the commissioner of HHSC to adopt rules necessary to carry out the commission's duties, and §531.021(b), which establishes HHSC as the agency responsible for adopting reasonable rules governing the determination of fees, charges, and rates for medical assistance payments under Human Resources Code, Chapter 32.

The amendments affect the Government Code, §§531.033 and 531.021(b).