The Texas Health and Human Services Commission (HHSC) proposes amendments to §353.1301, concerning General Provisions.

BACKGROUND AND PURPOSE

In March of 2017, HHSC adopted a series of rules governing delivery system and provider payment initiatives through Medicaid managed care organizations (MCOs) (42 TexReg 1737). These initiatives are, generally, funded through intergovernmental transfers (IGT) from local governmental entities. Given that these programs are not funded with state general revenue, HHSC must ensure, to the greatest extent possible, that no state dollars are at risk through the operation of these programs. A disallowance by the Centers for Medicare & Medicaid Services (CMS) is one potential risk to general revenue, unless HHSC can ensure that funds from another source are available.

Section 353.1301(j) describes the procedure HHSC would use in the case of a disallowance. The rule delineates between a disallowance for impermissible provider-related donations and all other disallowances. At present, if there is a disallowance for impermissible provider-related donations, the rule requires HHSC to recoup the disallowed amount from transferring governmental entities that caused the disallowance. If there is a disallowance for reasons other than an impermissible provider-related donation, HHSC reserves the right to recoup the disallowed amount from MCOs, providers, or governmental entities.

In an effort to provide HHSC more flexibility when determining the appropriate entity from which to recoup, HHSC proposes to amend §353.1301 to remove the requirement that it recoup only from governmental entities in the case of a disallowance for impermissible provider-related donations. Instead, HHSC will reserve the right to recoup from MCOs, providers, or governmental entities in any disallowance. In order to ensure that there is no risk to general revenue, to the greatest extent possible, HHSC will require that if a recoupment for a disallowance results in a subsequent disallowance, the entity that HHSC initially recouped against will face a recoupment for the subsequent disallowance.

In addition, HHSC will clarify the heading for §353.1301(k) by changing the name from "Recoupment" to "Overpayment."

SECTION-BY-SECTION SUMMARY

Proposed amendments to §353.1301(b) add the acronym "SDA" to the definition of "service delivery area."

Proposed amendments to §353.1301(j) change the requirements for recoupments in the case of a disallowance for impermissible provider-related donations. Further, the amendments require the same entities that pay for any initial disallowance to pay for subsequent recoupments resulting from that initial disallowance.

Proposed amendment to §353.1301(k) changes the heading for the subsection from "Recoupment" to "Overpayment."

FISCAL NOTE

Greta Rymal, Deputy Executive Commissioner for Financial Services, has determined that for each year of the first five years that the amendment will be in effect, there are no anticipated implications to costs or revenues of state or local governments as a result of enforcing and administering the rule as proposed.

SMALL BUSINESS AND MICRO-BUSINESS IMPACT ANALYSIS

Ms. Rymal has also determined that there is no anticipated adverse economic impact on small businesses or micro-businesses required to comply with the changes to the section proposed. Participants referred to in this rule are hospitals and nursing facilities. No Texas hospital meets the definition of a small business or micro-business. Nursing facility participation in the programs described in this subchapter is voluntary.

ECONOMIC COSTS TO PERSONS AND IMPACT ON LOCAL EMPLOYMENT

There are no anticipated economic costs to persons who are required to comply with the amendment as proposed.

There is no anticipated negative impact on local employment.

PUBLIC BENEFIT

Pam McDonald, Director of Rate Analysis, has determined that for each year of the first five years the amendment is in effect, the public will benefit from adoption of the amendment. The public benefit anticipated as a result of enforcing or administering the amendment is that HHSC will have greater flexibility in determining the appropriate entity from which to recoup funds in the event of a disallowance. Further, the public will benefit from the greater certainty surrounding general revenue.

TAKINGS IMPACT ASSESSMENT

HHSC has determined that the 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 Government Code, §2007.043.

PUBLIC COMMENT

Written comments on the proposal may be submitted to Charles Greenberg, Director of Policy for Legal Services, 4900 N. Lamar Blvd., Mail Code 1100, Austin, Texas 78751; by fax to (512) 424-6586; or by e-mail to charles.greenberg@hhsc.state.tx.us within 30 days of publication of this proposal in the Texas Register.

To be considered, comments must be submitted no later than 30 days after the date of this issue of the Texas Register. The last day to submit comments falls on a Sunday; therefore, comments must be: (1) postmarked or shipped before the last day of the comment period; (2) hand-delivered before 5:00 p.m. on the last working day of the comment period; or (3) faxed or e-mailed by midnight on the last day of the comment period. When faxing or e-mailing comments, please indicate "Comments on Proposed Rule 1R061" in the subject line.

STATUTORY AUTHORITY

The amendment is proposed under Texas Government Code §531.033, which provides the Executive Commissioner of HHSC with board rulemaking authority; Texas Human Resources Code §32.021 and Texas Government Code §531.021(a), which provide HHSC with the authority to administer the federal medical assistance (Medicaid) program in Texas; Texas Government Code §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 the Texas Human Resources Code, Chapter 32; and with Texas Government Code §533.002, which authorizes HHSC to implement the Medicaid managed care program.