BILL ANALYSIS Ó SENATE COMMITTEE ON HEALTH Senator Ed Hernandez, O.D., Chair BILL NO: SB 296 --------------------------------------------------------------- |AUTHOR: |Cannella | |---------------+-----------------------------------------------| |VERSION: |April 7, 2015 | --------------------------------------------------------------- --------------------------------------------------------------- |HEARING DATE: |April 15, 2015 | | | --------------------------------------------------------------- --------------------------------------------------------------- |CONSULTANT: |Reyes Diaz | --------------------------------------------------------------- SUBJECT : Medi-Cal: specialty mental health services: documentation requirements. SUMMARY : Requires the Department of Health Care Services (DHCS) to develop a single set of documentation requirements, with consultation from various entities as specified, for the provision of specialty mental health (SMH) services by January 1, 2017, for use commencing July 1, 2017. Requires DHCS to update the documentation requirements no less than every two years, unless more frequent updating is required, as specified. Prohibits counties from requiring additional documentation for SMH services, unless required by funding sources. Existing law: 1.Establishes the Medi-Cal program, administered by DHCS, under which qualified low-income individuals receive health care services. 2.Requires DHCS to create a standardized set of documentation standards and forms in order to facilitate the receipt of medically necessary SMH services by a foster child who is placed outside of his or her county of original jurisdiction. This bill: 1.Requires DHCS to consult with counties, providers, national experts, other states, and other stakeholders to develop a single set of service documentation requirements for the provision of SMH services. 2.Requires the documentation requirements to: a) minimize time and paperwork required of counties and providers, consistent with federal standards and practices of other states; b) eliminate duplicative or outdated requirements; and c) reflect SB 296 (Cannella) Page 2 of ? outcome reporting requirements developed pursuant to the performance outcome system for Early and Periodic Screening, Diagnosis, and Treatment (EPSDT) mental health services. 3.Requires DHCS to complete the documentation requirements by January 1, 2017, for use commencing July 1, 2017, and to update the documentation requirements no less than every two years through a stakeholder process, unless changes in the Medicaid state plan or other federal rules require more frequent updating. 4.Prohibits a county from requiring additional documentation, after DHCS adopts the standard requirements, for SMH services that go beyond DHCS's requirements unless it is necessary for counties to comply with requirements from funding sources that are used to pay for the services. 5.Makes findings and declarations about the amount of time paperwork documentation takes in the state because counties have added documentation requirements based on the fear that state audits will result in billing disallowances. States the necessity for DHCS to develop a single set of documentation requirements to limit audit disallowances. FISCAL EFFECT : This bill has not been analyzed by a fiscal committee. COMMENTS : 1.Author's statement. According to the author, SB 296 is necessary because it would get rid of the concern from mental health officials and the community agencies they contract with that the state's interpretation of the guidelines in audits might disallow some services if the additional documentation were not included. While the state guidelines on billing are not much different from other states, counties have added so many requirements that it takes up to 20 minutes of documentation to prepare progress notes on things like psychotherapy, while in other states it takes five minutes. This costs manpower and money to the state and counties. SB 296 would end this pattern by creating a single set of documentation requirements developed by the state, in consultation with counties and providers, that limits audit disallowances to circumstances clearly spelled out in the requirements, and is designed to be the minimum documentation requirements necessary to comply with federal law and other SB 296 (Cannella) Page 3 of ? applicable state laws. 2.CMS requirements for reimbursement. Behavioral health services must meet specific requirements for reimbursement. Documented services must: a. Meet that state's Medicaid program rules; b. To the extent required under state law, reflect medical necessity and justify the treatment and clinical rationale (each state adopts its own medical necessity definition); c. To the extent required under state law, reflect active treatment; d. Be complete, concise, and accurate, including the face-to-face time spent with the patient (for example, the time spent to complete a psychosocial assessment, a treatment plan, or a discharge plan); e. Be legible, signed, and dated; f. Be maintained and available for review; and, g. Be coded correctly for billing purposes. Centers for Medicare and Medicaid Services (CMS) states that a reason for documenting medical services is to comply with federal and state laws, which require proper support for billed claims. In addition, CMS states that documentation done well can help protect a behavioral health practitioner from billing disallowances. 1.State SMH service reimbursement. In order to receive reimbursement for SMH services, the current contracts that counties have with the state require medical necessity to be met for the service as documented on an assessment with an International Classification of Diseases or Diagnostic and Statistical Manual of Mental Disorders diagnosis, a treatment plan with objectives/interventions and client participation, and progress notes with the intervention and response of the client. According to the County Behavioral Health Directors Association of California (CBHDAC), counties, as the contracting entity with mental health plans (MHPs), need to have the ability to impose greater documentation to meet requirements based on: a. The need for authorization or the need for service; b. Risk, (e.g. the Los Angeles County Blue Ribbon Commission mandate to assess for self-harm vulnerability SB 296 (Cannella) Page 4 of ? risk); c. The need for ongoing flex funds for a particular client; or d. Documentation-related practice mandates (entering data into the Managing and Adapting Practice [MAP] database dashboard at the end of each MAP session). If counties have additional documentation requirements, according to CBHDAC, it is usually based on other funding requirements and/or special interests by the boards of supervisors, Blue Ribbon Commissions, courts, or other state departments. 2.DHCS billing disallowances. In a presentation document DHCS shared at the California Mental Health Directors Association All Directors Meeting on January 9, 2014, DHCS noted that in Fiscal Years (FY) 2007-2013, disallowance rates for outpatient chart reviews of a sampling of MHPs increased, with the most notable increase occurring between FYs 2011-12 (26 percent) and 2012-2013 (36 percent). DHCS noted that the increase may have been attributed to the inclusion of children/adolescents data in the sample. Prior to FY 2011-12, the triennial outpatient chart samples consisted of adults only, and there were separate EPSDT chart audits conducted. In addition, with the inclusion of children/adolescents and the resulting Day Treatment Intensive (DTI) and Day Rehabilitation (DR) paid claims in the same sample, DHCS notes that the disallowance rates increased. DHCS's presentation document also noted that 90 percent of the DTI and DR claims were disallowed in FY 2011-12. Primary reasons for disallowances were due to provider documentation error, such as lack of required service components, no documentation of attendance, absence of required progress notes, medical necessity not substantiated, and not meeting program Medi-Cal certification requirements. 3.Concerns with existing SMH 1915(b) waiver. DHCS administers a Section 1915(b) Freedom of Choice federal waiver to provide SMH services using a managed care model of service delivery. The SMH waiver program has been in effect since 1995, with a total of eight waiver terms approved by CMS to date. The eighth waiver term was approved by CMS for two years only (July 1, 2013, through June 30, 2015), instead of the five years initially requested by DHCS. CMS stipulated that DHCS needed to continue with regular monitoring activities with CMS, including monthly calls. During the monthly monitoring SB 296 (Cannella) Page 5 of ? calls and in ongoing communications, CMS has asked questions on specific areas of the SMH waiver. CMS reviews MHP triennial and External Quality Review Organization reports and raised concern about the findings and continued noncompliance with specific waiver requirements. CMS believes that significant improvement is needed in identified areas and expects the state to closely monitor, ensure, and provide evidence of compliance. In addition to a number of identified areas of focus, CMS has expressed concern about the ongoing elevated inpatient and outpatient disallowance rates resulting from chart reviews (i.e., disallowed claims under the Medi-Cal program). Due to past deficiencies, CMS is requiring the state to provide oversight to ensure that the Medi-Cal claims submitted by MHPs for SMH services meet medical necessity criteria for reimbursement and that the documentation in the medical records provided contains the required evidence of medical necessity. CMS has requested that DHCS explore establishing a process to enact fines, sanctions and penalties, or corrective actions as a way to ensure compliance. 4.Lack of evidence-based/best practice service provision for behavioral health. The Technical Assistance Collaborative/Human Services Research Institute's final report in February 2012, California Mental Health and Substance Use System Needs Assessment, notes that the percent of individuals reported to be receiving an evidence-based practice service was low: only one percent in 2010, down from two percent in 2009. It also notes that there is a variability among counties in the use and training of staff in state-of-the-art and evidence-based and recovery-oriented treatment; there is a need to address better preparation of physical health providers to engage and treat people with behavioral health needs; and there is still disproportionate access to behavioral health services on the part of certain ethnic populations-compounded by the relative lack of cultural/linguistic capacity among providers and practitioners in the state. 5.Support. Supporters of this bill argue that paperwork reduction is one great way of increasing the efficiency of the health care system while helping to improve outcomes. The California Chapter of the American College of Emergency Physicians states that individual counties across the state have their own documentation requirements, adding SB 296 (Cannella) Page 6 of ? substantially to the amount of time Medi-Cal providers spend documenting their services. The American Association for Marriage and Family Therapy California Division argues that paperwork overload contributes to workplace fatigue and that this bill will improve the morale of mental health workers. 6.Policy comment. a. This bill requires DHCS to develop a single set of documentation requirements for the provision of SMH services, which raises questions about a county's ability to require or collect information related to evidence-based practice implementation or other best practice assessments. The sponsor of this bill states that the intent is to limit county requirements for documentation of compliance with billing rules, which is not indicated in this bill. The author may wish to clarify this intent. b. This bill makes findings and declarations about a national expert's review of counties' documentation requirements and determination that it takes an average of 20 minutes to prepare progress notes in California compared to an estimated five minutes in other states and, therefore, proposes to limit the amount of documentation a county can require. According to DHCS, disallowances generally occur because of a provider's inability to accurately document service provision as required, and not because of excessive paperwork requirements. According to counties, all documentation required serves a critical purpose. The author may wish to consider whether relaxing documentation requirements is the right solution at a time when CMS is closely monitoring the state because of concerns about the state's high disallowance rate, including lack of proper documentation. SUPPORT AND OPPOSITION : Support: California Council of Community Mental Health Agencies (sponsor) American Association for Marriage and Family Therapy California Division California Chapter of the American College of Emergency Physicians Mental Health America of California SB 296 (Cannella) Page 7 of ? Steinberg Institute Oppose: None received. -- END --