AB 1863, as amended, Wood. Medi-Cal: federally qualified health centers: rural health centers.
Existing law provides for the Medi-Cal program, which is administered by the State Department of Health Care Services, under which qualified low-income individuals receive health care services. The Medi-Cal program is, in part, governed and funded by federal Medicaid
begin delete Programend delete provisions. Existing law provides that federally qualified health center (FQHC) services and rural health clinic (RHC) services, as defined, are covered benefits under the Medi-Cal program, to be reimbursed, to the extent that federal financial participation is obtained, to providers on a per-visit basis. “Visit” is defined as a face-to-face encounter between a patient of an FQHC or RHC and specified health care
professionals. Existing law allows an FQHC or RHC to apply for an adjustment to its per-visit rate based on a change in the scope of services it provides.
This bill would include a marriage and family therapist within those health care professionals covered under that definition. The bill would require an FQHC or RHC that currently includes the cost of services of a marriage and family therapist for the purposes of establishing its FQHC or RHC rate to apply to the department for an adjustment to its per-visit
begin delete rate,end delete and, after the rate adjustment has
been approved by the department, would require the FQHC or RHC to bill these services as a separate visit, as specified. The bill would require an FQHC or RHC that does not provide the services of a marriage and family therapist, and later elects to add these begin delete services,end delete to process the addition of these services as a change in scope of service.
Vote: majority. Appropriation: no. Fiscal committee: yes. State-mandated local program: no.
The people of the State of California do enact as follows:
Section 14132.100 of the Welfare and Institutions
2Code is amended to read:
(a) The federally qualified health center services
4described in Section 1396d(a)(2)(C) of Title 42 of the United States
5Code are covered benefits.
6(b) The rural health clinic services described in Section
71396d(a)(2)(B) of Title 42 of the United States Code are covered
9(c) Federally qualified health center services and rural health
10clinic services shall be reimbursed on a per-visit basis in
11accordance with the definition of “visit” set forth in subdivision
13(d) Effective October 1, 2004, and on each October 1, thereafter,
14until no longer required by federal law, federally qualified health
15center (FQHC) and rural health clinic (RHC) per-visit rates shall
16be increased by the Medicare Economic Index applicable to
17primary care services in the manner provided for in Section
181396a(bb)(3)(A) of Title 42 of the United States Code. Prior to
19January 1, 2004, FQHC and RHC per-visit rates shall be adjusted
20by the Medicare Economic Index in accordance with the
21methodology set forth in the state plan in effect on October 1,
23(e) (1) An FQHC or RHC may apply for an adjustment to its
24per-visit rate based on a change in the scope of services provided
25by the FQHC or RHC. Rate changes based on a change in the
26scope of services provided by an FQHC or RHC shall be evaluated
P3 1in accordance with Medicare reasonable cost principles, as set
2forth in Part 413 (commencing with Section 413.1) of Title 42 of
3the Code of Federal Regulations, or its successor.
4(2) Subject to the conditions set forth in subparagraphs (A) to
5(D), inclusive, of paragraph (3), a change in scope of service means
6any of the following:
7(A) The addition of a new FQHC or RHC service that is not
8incorporated in the baseline prospective payment system (PPS)
9rate, or a deletion of an FQHC or RHC service that is incorporated
10in the baseline PPS rate.
11(B) A change in service due to amended regulatory requirements
13(C) A change in service resulting from relocating or remodeling
14an FQHC or RHC.
15(D) A change in types of services due to a change in applicable
16technology and medical practice utilized by the center or clinic.
17(E) An increase in service intensity attributable to changes in
18the types of patients served, including, but not limited to,
19populations with HIV or AIDS, or other chronic diseases, or
20homeless, elderly, migrant, or other special populations.
21(F) Any changes in any of the services described in subdivision
22(a) or (b), or in the provider mix of an FQHC or RHC or one of
24(G) Changes in operating costs attributable to capital
25expenditures associated with a modification of the scope of any
26of the services described in subdivision (a) or (b), including new
27or expanded service facilities, regulatory compliance, or changes
28in technology or medical practices at the center or clinic.
29(H) Indirect medical education adjustments and a direct graduate
30medical education payment that reflects the costs of providing
31teaching services to interns and residents.
32(I) Any changes in the scope of a project approved by the federal
33Health Resources and Services Administration (HRSA).
34(3) No change in costs shall, in and of itself, be considered a
35scope-of-service change unless all of the following apply:
36(A) The increase or decrease in cost is attributable to an increase
37or decrease in the scope of services defined in subdivisions (a) and
38(b), as applicable.
39(B) The cost is allowable under Medicare reasonable cost
40principles set forth in Part 413 (commencing with Section 413) of
P4 1Subchapter B of Chapter 4 of Title 42 of the Code of Federal
2Regulations, or its successor.
3(C) The change in the scope of services is a change in the type,
4intensity, duration, or amount of services, or any combination
6(D) The net change in the FQHC’s or RHC’s rate equals or
7exceeds 1.75 percent for the affected FQHC or RHC site. For
8FQHCs and RHCs that filed consolidated cost reports for multiple
9sites to establish the initial prospective payment reimbursement
10rate, the 1.75-percent threshold shall be applied to the average
11per-visit rate of all sites for the purposes of calculating the cost
12associated with a scope-of-service change. “Net change” means
13the per-visit rate change attributable to the cumulative effect of all
14increases and decreases for a particular fiscal year.
15(4) An FQHC or RHC may submit requests for scope-of-service
16changes once per fiscal year, only within 90 days following the
17beginning of the FQHC’s or RHC’s fiscal year. Any approved
18increase or decrease in the provider’s rate shall be retroactive to
19the beginning of the FQHC’s or RHC’s fiscal year in which the
20request is submitted.
21(5) An FQHC or RHC shall submit a scope-of-service rate
22change request within 90 days of the beginning of any FQHC or
23RHC fiscal year occurring after the effective date of this section,
24if, during the FQHC’s or RHC’s prior fiscal year, the FQHC or
25RHC experienced a decrease in the scope of services provided that
26the FQHC or RHC either knew or should have known would have
27resulted in a significantly lower per-visit rate. If an FQHC or RHC
28discontinues providing onsite pharmacy or dental services, it shall
29submit a scope-of-service rate change request within 90 days of
30the beginning of the following fiscal year. The rate change shall
31be effective as provided for in paragraph (4). As used in this
32paragraph, “significantly lower” means an average per-visit rate
33decrease in excess of 2.5 percent.
34(6) Notwithstanding paragraph (4), if the approved
35scope-of-service change or changes were initially implemented
36on or after the first day of an FQHC’s or RHC’s fiscal year ending
37in calendar year 2001, but before the adoption and issuance of
38written instructions for applying for a scope-of-service change,
39the adjusted reimbursement rate for that scope-of-service change
40shall be made retroactive to the date the scope-of-service change
P5 1was initially implemented. Scope-of-service changes under this
2paragraph shall be required to be submitted within the later of 150
3days after the adoption and issuance of the written instructions by
4the department, or 150 days after the end of the FQHC’s or RHC’s
5fiscal year ending in 2003.
6(7) All references in this subdivision to “fiscal year” shall be
7construed to be references to the fiscal year of the individual FQHC
8or RHC, as the case may be.
9(f) (1) An FQHC or RHC may request a supplemental payment
10if extraordinary circumstances beyond the control of the FQHC
11or RHC occur after December 31, 2001, and PPS payments are
12insufficient due to these extraordinary circumstances. Supplemental
13payments arising from extraordinary circumstances under this
14subdivision shall be solely and exclusively within the discretion
15of the department and shall not be subject to subdivision (l). These
16supplemental payments shall be determined separately from the
17scope-of-service adjustments described in subdivision (e).
18Extraordinary circumstances include, but are not limited to, acts
19of nature, changes in applicable requirements in the Health and
20Safety Code, changes in applicable licensure requirements, and
21changes in applicable rules or regulations. Mere inflation of costs
22 alone, absent extraordinary circumstances, shall not be grounds
23for supplemental payment. If an FQHC’s or RHC’s PPS rate is
24sufficient to cover its overall costs, including those associated with
25the extraordinary circumstances, then a supplemental payment is
27(2) The department shall accept requests for supplemental
28payment at any time throughout the prospective payment rate year.
29(3) Requests for supplemental payments shall be submitted in
30writing to the department and shall set forth the reasons for the
31request. Each request shall be accompanied by sufficient
32documentation to enable the department to act upon the request.
33Documentation shall include the data necessary to demonstrate
34that the circumstances for which supplemental payment is requested
35meet the requirements set forth in this section. Documentation
36shall include all of the following:
37(A) A presentation of data to demonstrate reasons for the
38FQHC’s or RHC’s request for a supplemental payment.
39(B) Documentation showing the cost implications. The cost
40impact shall be material and significant, two hundred thousand
P6 1dollars ($200,000) or 1 percent of a facility’s total costs, whichever
3(4) A request shall be submitted for each affected year.
4(5) Amounts granted for supplemental payment requests shall
5be paid as lump-sum amounts for those years and not as revised
6PPS rates, and shall be repaid by the FQHC or RHC to the extent
7that it is not expended for the specified purposes.
8(6) The department shall notify the provider of the department’s
9discretionary decision in writing.
10(g) (1) An FQHC or RHC “visit” means a face-to-face
11encounter between an FQHC or RHC patient and a physician,
12physician assistant, nurse practitioner, certified nurse-midwife,
13clinical psychologist, licensed clinical social worker, or a visiting
14nurse. For purposes of this section, “physician” shall be interpreted
15in a manner consistent with the Centers for Medicare and Medicaid
16Services’ Medicare Rural Health Clinic and Federally Qualified
17Health Center Manual (Publication 27), or its successor, only to
18the extent that it defines the professionals whose services are
19reimbursable on a per-visit basis and not as to the types of services
20that these professionals may render during these visits and shall
21include a physician and surgeon, osteopath, podiatrist, dentist,
22optometrist, and chiropractor. A visit shall also include a
23face-to-face encounter between an FQHC or RHC patient and a
24comprehensive perinatal practitioner, as defined in Section 51179.7
25of Title 22 of the California Code of Regulations, providing
26comprehensive perinatal services, a four-hour day of attendance
27at an adult day health care center, and any other provider identified
28in the state plan’s definition of an FQHC or RHC visit.
29(2) (A) A visit shall also include a face-to-face encounter
30between an FQHC or RHC patient and a dental hygienist, a dental
31hygienist in alternative practice, or a marriage and family therapist.
32(B) Notwithstanding subdivision (e), an FQHC or RHC that
33currently includes the cost of the services of a dental hygienist in
34alternative practice, or a marriage and family therapist for the
35purposes of establishing its FQHC or RHC rate shall apply
37for an adjustment to its per-visit rate, and, after the rate adjustment
38has been approved by the department, shall bill these services as
39a separate visit. However, multiple encounters with dental
40professionals or marriage and family therapists that take place on
P7 1the same day shall constitute a single visit. The department shall
2develop the appropriate forms to determine which FQHC’s or
3RHC’s rates shall be adjusted and to facilitate the calculation of
4the adjusted rates. An FQHC’s or RHC’s application for, or the
5department’s approval of, a rate adjustment pursuant to this
6subparagraph shall not constitute a change in scope of service
7within the meaning of subdivision (e). An FQHC or RHC that
8applies for an adjustment to its rate pursuant to this subparagraph
9may continue to bill for all other FQHC or RHC visits at its existing
10per-visit rate, subject to reconciliation, until the rate adjustment
11for visits between an FQHC or RHC patient and a dental hygienist,
12a dental hygienist in alternative practice, or a marriage and family
13therapist has been approved. Any approved increase or decrease
14in the provider’s rate shall be made within six months after the
15date of receipt of the department’s rate adjustment forms pursuant
16to this subparagraph and shall be retroactive to the beginning of
17the fiscal year in which the FQHC or RHC submits the request,
18but in no case shall the effective date be earlier than January 1,
20(C) An FQHC or RHC that does not provide dental hygienist,
21dental hygienist in alternative practice, or marriage and family
22therapist services, and later elects to add these
begin delete services,end delete shall process the addition
24of these services as a change in scope of service pursuant to
26(h) If FQHC or RHC services are partially reimbursed by a
27third-party payer, such as a managed care entity (as defined in
28Section 1396u-2(a)(1)(B) of Title 42 of the United States Code),
29the Medicare Program, or the Child Health and Disability
30 Prevention (CHDP) program, the department shall reimburse an
31FQHC or RHC for the difference between its per-visit PPS rate
32and receipts from other plans or programs on a contract-by-contract
33basis and not in the aggregate, and may not include managed care
34financial incentive payments that are required by federal law to
35be excluded from the calculation.
36(i) (1) An entity that first qualifies as an FQHC or RHC in the
37year 2001 or later, a newly licensed facility at a new location added
38to an existing FQHC or RHC, and any entity that is an existing
39FQHC or RHC that is relocated to a new site shall each have its
P8 1reimbursement rate established in accordance with one of the
2following methods, as selected by the FQHC or RHC:
3(A) The rate may be
calculated on a per-visit basis in an amount
4that is equal to the average of the per-visit rates of three comparable
5FQHCs or RHCs located in the same or adjacent area with a similar
7(B) In the absence of three comparable FQHCs or RHCs with
8a similar caseload, the rate may be calculated on a per-visit basis
9in an amount that is equal to the average of the per-visit rates of
10three comparable FQHCs or RHCs located in the same or an
11adjacent service area, or in a reasonably similar geographic area
12with respect to relevant social, health care, and economic
14(C) At a new entity’s one-time election, the department shall
15establish a reimbursement rate, calculated on a per-visit basis, that
16is equal to 100 percent of the projected allowable costs to the
17FQHC or RHC of furnishing FQHC or RHC services during the
18first 12 months of operation as an FQHC or RHC. After the first
1912-month period, the projected per-visit rate shall be increased by
20the Medicare Economic Index then in effect. The projected
21allowable costs for the first 12 months shall be cost settled and the
22prospective payment reimbursement rate shall be adjusted based
23on actual and allowable cost per visit.
24(D) The department may adopt any further and additional
25methods of setting reimbursement rates for newly qualified FQHCs
26or RHCs as are consistent with Section 1396a(bb)(4) of Title 42
27of the United States Code.
28(2) In order for an FQHC or RHC to establish the comparability
29of its caseload for purposes of subparagraph (A) or (B) of paragraph
30(1), the department shall require that the FQHC or RHC submit
31its most recent annual utilization report as submitted to the Office
32of Statewide Health Planning and Development, unless the FQHC
33or RHC was not required to file an annual utilization report. FQHCs
34or RHCs that have experienced changes in their services or
35caseload subsequent to the filing of the annual utilization report
36may submit to the department a completed report in the format
37applicable to the prior calendar year. FQHCs or RHCs that have
38not previously submitted an annual utilization report shall submit
39to the department a completed report in the format applicable to
40the prior calendar year. The FQHC or RHC shall not be required
P9 1to submit the annual utilization report for the comparable FQHCs
2or RHCs to the department, but shall be required to identify the
3comparable FQHCs or RHCs.
4(3) The rate for any newly qualified entity set forth under this
5subdivision shall be effective retroactively to the later of the date
6that the entity was first qualified by the applicable federal agency
7as an FQHC or RHC, the date a new facility at a new location was
8added to an existing FQHC or RHC, or the date on which an
9existing FQHC or RHC was relocated to a new site. The FQHC
10or RHC shall be permitted to continue billing for Medi-Cal covered
11 benefits on a fee-for-service basis under its existing provider
12number until it is informed of its FQHC or RHC enrollment
13approval, and the department shall reconcile the difference between
14the fee-for-service payments and the FQHC’s or RHC’s prospective
15payment rate at that time.
16(j) Visits occurring at an intermittent clinic site, as defined in
17subdivision (h) of Section 1206 of the Health and Safety Code, of
18an existing FQHC or RHC, or in a mobile unit as defined by
19paragraph (2) of subdivision (b) of Section 1765.105 of the Health
20and Safety Code, shall be billed by and reimbursed at the same
21rate as the FQHC or RHC establishing the intermittent clinic site
22or the mobile unit, subject to the right of the FQHC or RHC to
23request a scope-of-service adjustment to the rate.
24(k) An FQHC or RHC may elect to have pharmacy or dental
25services reimbursed on a fee-for-service basis, utilizing the current
26fee schedules established for those services. These costs shall be
27adjusted out of the FQHC’s or RHC’s clinic base rate as
28scope-of-service changes. An FQHC or RHC that reverses its
29election under this subdivision shall revert to its prior rate, subject
30to an increase to account for all Medicare Economic Index
31increases occurring during the intervening time period, and subject
32to any increase or decrease associated with applicable
33scope-of-service adjustments as provided in subdivision (e).
34(l) FQHCs and RHCs may appeal a grievance or complaint
35concerning ratesetting, scope-of-service changes, and settlement
36of cost report audits, in the manner prescribed by Section 14171.
37The rights and remedies provided under this subdivision are
38cumulative to the rights and remedies available under all other
39provisions of law of this state.
P10 1(m) The department shall, no later than March 30, 2008,
2promptly seek all necessary federal approvals in order to implement
3this section, including any amendments to the state plan. To the
4extent that any element or requirement of this section is not
5approved, the department shall submit a request to the federal
6Centers for Medicare and Medicaid Services for any waivers that
7would be necessary to implement this section.
8(n) The department shall implement this section only to the
9extent that federal financial participation is obtained.