The Texas Health and Human Services Commission (HHSC) proposes new §354.1177, concerning implementation of Electronic Visit Verification (EVV) System.

Background and Justification

Texas Government Code §531.024172, adopted in 2011, requires HHSC, if it is cost-effective and feasible, to implement an EVV system to electronically verify and document through a telephone or computer-based system basic information relating to the delivery of Medicaid acute nursing services. See Act of June 27, 2011, 82nd Legislature, 1st Called Session, Chapter 7, §1.01, 2011 Texas General Laws 5390, 5391-92 (S.B. 7). Acute nursing services, as used in §531.024172, means home health skilled nursing services, home health aide services, and private duty nursing services. Texas Government Code §531.02417. In addition, the 2012-2013 and 2014-2015 appropriation acts require HHSC to reduce the amount of general revenue funds expended for Medicaid by implementing a plan that may include an initiative to conduct "statewide monitoring of community care and home health through electronic visit verification in Medicaid fee-for-service and managed care." General Appropriations Act, 83rd Legislature, Regular Session, Chapter 1411, Article II, Rider 51(b)(8), at II-100 (Health & Human Services Section, Health & Human Services Commission); General Appropriations Act, 82nd Legislature, Regular Session, Chapter 1355, Article II, Rider 61(b)(8), at II-94 (Health & Human Services Section, Health & Human Services Commission).

Based on EVV savings achieved in the Department of Aging and Disability Services (DADS) EVV pilot program, HHSC estimates an approximate 2% savings in Private Duty Nursing (PDN) and approximately 3% savings in Personal Care Services (PCS). Additional savings may be achieved as the estimated savings for PDN and PCS do not include home health nursing services, which will also be included in HHSC's EVV program.

The proposed new rule establishes requirements applicable to contractors providing EVV services for Medicaid-enrolled providers and guidelines for Medicaid-enrolled providers that are required to use an EVV system for services as defined by HHSC. Additionally, the rule defines which Medicaid services require EVV and identifies the data elements that must be included to verify the service occurred.

Section-by-Section Summary

Proposed §354.1177(a) defines key terms used in §354.1177.

Proposed §354.1177(b) sets out EVV system requirements.

Proposed §354.1177(c) states that HHSC will certify EVV service providers based on demonstrated ability to meet HHSC-approved minimum standard requirements.

Proposed §354.1177(d) requires use of an EVV system to document the provision of the following attendant and nursing services in a home or community setting: home health skilled nursing; private duty nursing; and personal care services.

Proposed §354.1177(e) lists requirements applicable to providers required to utilize EVV.

Proposed §354.1177(f) allows for grandfathering certain Medicaid-enrolled-provider-based EVV systems if the system meets certain requirements.

Proposed §354.1177(g) states that HHSC will not reimburse a claim for services subject to the EVV requirements unless the data from the EVV system corresponds with the services for which reimbursement is claimed and is consistent with an approved HHSC prior authorization or DADS Plan of Care. This subsection also states that claims may be subject to retrospective review and recoupment.

Fiscal Note

Greta Rymal, Deputy Executive Commissioner for Financial Services, has determined that during the first five-year period the proposed rule is in effect, there will be a fiscal impact of general revenue savings to state government in the amount of ($22,229,393) for state fiscal year (SFY) 2014 through SFY 2018: ($1,065,097) for SFY 2014; ($4,696,887) for SFY 2015; ($5,077,454) for SFY 2016; ($5,478,573) for SFY 2017; and ($5,911,381) for SFY 2018. This estimate also includes administrative costs, but does not include the impact of EVV in the STAR+PLUS program or DADS programs. EVV also will be implemented for attendant and nursing services in STAR+PLUS and some DADS programs, resulting in additional savings.

Small and Micro-business Impact Analysis

HHSC has determined that there may be an impact on small businesses or micro-businesses as Texas Medicaid-enrolled providers may incur additional costs in staff time needed to comply with requirements of EVV. Although Medicaid providers will not be required to pay for EVV transaction costs, implementation of EVV may increase administrative costs for some providers. Providers will be responsible for ensuring service attendants comply with EVV activities (documenting when services begin and end), which will include training for service attendants and staff. In addition, Medicaid-enrolled provider staff will have to work with EVV vendors to provide recipient service delivery schedules in order to document EVV. HHSC does not have sufficient data to provide an estimated fiscal impact.

Cost to Persons and Effect on Local Economies

HHSC is unable to determine the economic cost to persons who are required to comply with the amendment as the number of providers subject to the rule is unknown. Medicaid-enrolled providers providing attendant and nursing services in STAR+PLUS, fee-for-service, and approximately six DADS waiver programs will be required to comply with EVV. Additional programs and/or services may be included in EVV at a later date. However, there is no anticipated negative impact on local employment or local economies as the anticipated cost savings from EVV may result overall in less administrative burden for providers.

Public Benefit

Chris Traylor, Chief Deputy Commissioner, has determined that for each year of the first five years the proposed rule is in effect, the public will benefit from the adoption of the rule, which HHSC believes will achieve cost savings by reducing the incidence of timekeeping and record keeping errors, and reducing fraud, waste, and abuse. By reducing administrative errors, and fraud, waste, and abuse, both the State and Medicaid providers may experience fewer provider appeals, and audit reviews, resulting in less administrative burden.

Regulatory Analysis

HHSC has determined that this proposal is not a "major environmental rule" as defined by §2001.0225 of the Texas Government Code. A "major environmental rule" is defined to mean a rule the specific intent of which is to protect the environment or reduce risk to human health from environmental exposure and that may adversely affect, in a material way, the economy, a sector of the economy, productivity, competition, jobs, the environment, or the public health and safety of a state or a sector of the state. This proposal is not specifically intended to protect the environment or reduce risks to human health from environmental exposure.

Takings Impact Assessment

HHSC has determined that this proposal does not restrict or limit an owner's right to his or her property that would otherwise exist in the absence of government action and, therefore, does not constitute a taking under §2007.043 of the Texas Government Code.

Public Comment

Written comments on the proposal may be submitted to Deborah Keyser, Senior Program Specialist, Medicaid/CHIP Division, Health and Human Services Commission, P.O. Box 149030, MC-H100, Austin, Texas 78714; by fax to (512) 730-7476; or by e-mail to deborah.keyser@hhsc.state.tx.us within 30 days of publication of this proposal in the Texas Register.

Public Hearing

A public hearing is scheduled for February 11, 2014, from 10:00 a.m. to 11:00 a.m. (central time) at the Brown-Heatly Building, Conference Room 2301, located at 4900 North Lamar Boulevard, Austin, Texas 78751. Persons requiring further information, special assistance, or accommodations should contact Leigh Van Kirk at (512) 462-6284.

Statutory Authority

The new rule is proposed under Texas Government Code §531.033, which provides the Executive Commissioner of HHSC with broad rulemaking authority; and Texas Human Resources Code §32.021 and Texas Government Code §531.021, which authorize HHSC to administer the federal medical assistance (Medicaid) program in Texas.

This rule is proposed to effectuate Texas Government Code §531.024172, which requires HHSC, if it is cost-effective and feasible, to implement an EVV system to electronically verify and document basic information relating to the delivery of Medicaid acute nursing services.

The proposed new rule affects Texas Human Resources Code Chapter 32 and Texas Government Code Chapter 531. No other statutes, articles, or codes are affected by this proposal.