Original Notice.

Preproposal statement of inquiry was filed as WSR 99-06-085.

Title of Rule: WAC 388-502-0220 Administrative appeals--Rates--Contractor/provider and 388-550-5600 Hospital rate appeals and disputes.

Purpose: To comply with the Governor's Executive Order 97-02 which mandates that rules be reviewed and rewritten as necessary to ensure clarity, compliance with law, necessity, avoidance of duplication, etc. The rules are being rewritten to clarify the department's rate reimbursement appeal process.

Statutory Authority for Adoption: RCW 74.08.090, 74.09.730.

Statute Being Implemented: RCW 74.08.090, 74.09.210, 74.09.730.

Summary: WAC 388-502-0220 Administrative appeals--Rates--Contractor/provider, has been rewritten to clarify the department's rate reimbursement appeal process.

WAC 388-550-5600 Hospital rate appeals and disputes, reflects the same basic process and applies it to hospitals; it is being amended to refer the user to WAC 388-502-0220 to avoid duplication of WAC.

Reasons Supporting Proposal: To comply with the Governor's Executive Order 97-03 and to reduce duplication of WAC.

Name of Agency Personnel Responsible for Drafting, Implementation and Enforcement: Thaivan Nguyen, DOSS, 623 8th Avenue S.E., Olympia, WA 98501, (360) 586-6697.

Name of Proponent: Department of Social and Health Services, Medical Assistance Administration, governmental.

Rule is not necessitated by federal law, federal or state court decision.

Explanation of Rule, its Purpose, and Anticipated Effects: WAC 388-502-0220 states the department's rate reimbursement appeal process for contractor/providers and WAC 388-550-5600 applies the same appeal process to hospitals.

The purpose of the rule is to clearly explain what contractor/providers and hospitals must do to appeal a department reimbursement rate, and what the appeal process consists of.

The anticipated effects are that by stating the requirements and procedures clearly, department staff and vendors will be able to understand the process, and work together for informal resolution of appeals and disputes, avoiding possible costly and lengthy litigation.

Proposal Changes the Following Existing Rules: The proposed rule amends the rules listed above to clarify the rate reimbursement appeal process for both provider/contractors and hospitals. The existing chapter that describes the hospital rate appeal process (WAC 388-550-5600) is being significantly amended to eliminate restating the process and refers the reader to WAC 388-502-0220 Administrative appeals--Rates--Contractor/providers.

No small business economic impact statement has been prepared under chapter 19.85 RCW. The department has analyzed the proposed amendments and concluded that no new costs will be imposed on the providers affected by them.

RCW 34.05.328 applies to this rule adoption. The rules do meet the definition of a significant legislative rule, and the department has prepared and evaluation of probable costs and probable benefits. A copy may be obtained by contacting the person listed in Name of Agency Personnel above.

Hearing Location: Lacey Government Center (behind Tokyo Bento Restaurant), 1009 College Street S.E., Room 104-B, Lacey, WA 98503, on June 22, 1999, at 10:00 a.m.

Assistance for Persons with Disabilities: Contact Paige Wall by June 11, 1999, phone (360) 902-7540, TTY (360) 902-8324, e-mail pwall@dshs.wa.gov.

Submit Written Comments to: Identify WAC Numbers, Paige Wall, Rules Coordinator, Rules and Policies Assistance Unit, P.O. Box 45850, Olympia, WA 98504-5850, fax (360) 902-8292, by June 22, 1999.

Date of Intended Adoption: August 1, 1999.

May 13, 1999

Marie Myerchin-Redifer, Manager

Rules and Policies Assistance Unit

(1) ((Right to an administrative appeal.))  Any enrolled contractor/provider of medical services((, except nursing facilities governed by WAC 388-96-904, shall have)) has a right to an administrative appeal ((any time)) when the contractor/provider disagrees with the medical assistance administration’s (MAA) reimbursement rate . The exception to this is nursing facilities governed by WAC 388-96-904.

(2) ((First level of appeal.  A contractor/provider wishing to contest an action described in subsection (1) of this section files an appeal with the medical assistance administration (MAA) .

(a) Unless a written rate notification specifies otherwise, the department shall make retroactive rate adjustments only when a contractor/provider files a rate appeal.  The rate appeal requesting retroactive rate adjustment shall be made within sixty calendar days after being notified of an action or determination the contractor/provider wishes to challenge.  The notification date of an action or determination shall be the date of the written rate notification letter.  The department shall not consider for retroactive adjustments, a contractor/provider rate adjustment appeal filed after the sixty-day period described in this subsection.

(b) The appeal shall include a statement of the specific issue being appealed, supporting documentation, and a request for recalculation of the rate.  MAA may request additional documentation to complete the review.  MAA may conduct an audit of the documentation provided in order to complete the review.

(c) When a portion of a rate is appealed, MAA may review all components of the reimbursement rate.

(d) MAA shall issue a decision or request additional information within sixty calendar days of the receipt of the rate appeal request.  When additional information is necessary, the contractor/provider shall have forty-five calendar days to submit the information.  MAA shall issue a decision within thirty calendar days of receipt of complete information.

(e) Unless the written rate notification specifies otherwise, increases in rates resulting from an appeal shall be effective retroactively to the effective date of the rate change.  The appeal shall be filed within sixty calendar days after the written rate notification letter that the contractor/provider is challenging.  Increases in rates, resulting from a rate appeal filed after the sixty-day period described under (a) of this subsection, shall be effective the date the appeal is filed with MAA.  Appeals resulting in rate decreases shall be effective on the date specified in the appeal decision notification.  The effective date shall not be before the date of the appeal decision notification.  Rate changes subject to the provisions of fraudulent practices as described under RCW 74.09.210 are exempt from these provisions.

(f) MAA may grant extensions of time at MAA's discretion if requested within the sixty-day period referenced under (a) of this subsection)) The first level of appeal. A contractor/provider who wants to contest a reimbursement rate must file a written appeal with MAA.

(a) The appeal must include all of the following:

(i) A statement of the specific issue being appealed;

(ii) Supporting documentation; and

(iii) A request for MAA to recalculate the rate.

(b) When a contractor/provider appeals a portion of a rate, MAA may review all components of the reimbursement rate.

(c) In order to complete a review of the appeal, MAA may do one or both of the following:

(i) Request additional information; and/or

(ii) Conduct an audit of the documentation provided.

(d) MAA issues a decision or requests additional information within sixty calendar days of receiving the rate appeal request.

(i) When MAA requests additional information, the contractor/provider has forty-five calendar days from the date of MAA’s request to submit the additional information.

(ii) MAA issues a decision within thirty calendar days of receipt of the completed information.

(e) MAA may adjust rates retroactively to the effective date of a new rate or a rate change. In order for a rate increase to be retroactive, the contractor/provider must file the appeal within sixty calendar days of the date of the rate notification letter from MAA. MAA does not consider any appeal filed after the sixty day period to be eligible for retroactive adjustment.

(f) MAA may grant a time extension for the appeal period if the contractor/provider makes such a request within the sixty-day period referenced under (e) of this subsection.

(g) Any rate increase resulting from an appeal filed within the sixty-day period described in subsection (2)(e) of this section is effective retroactively to the rate effective date in the notification letter.

(h) Any rate increase resulting from an appeal filed after the sixty-day period described in subsection (2)(e) of this section is effective on the date the rate appeal is received by the department.

(i) Any rate decrease resulting from an appeal is effective on the date specified in the appeal decision letter.

(j) Any rate change that MAA grants that is the result of fraudulent practices on the part of the contractor/provider as described under RCW 74.09.210 is exempt from the appeal provisions in this chapter.

(3) The second level of appeal. When the contractor/provider disagrees with ((an adverse)) a rate review decision, ((the contractor/provider)) it may file a request for a dispute conference with ((the)) MAA.  (("D)) For this section "dispute conference" ((for this section)) means an informal administrative hearing for the purpose of resolving contractor/provider disagreements with ((any of the)) a department action((s,)) as described under subsection (1) of this section, and not ((resolved)) agreed upon at the first level of appeal.  The dispute conference is not governed by the Administrative Procedure Act, chapter 34.05 RCW.

(a) If a contractor/provider ((shall)) files a request for a dispute conference, it must submit the request to MAA within thirty calendar days ((following receipt of the adverse)) after the contractor/provider receives the rate review decision.  ((The department shall)) MAA does not consider dispute conference requests submitted after the thirty-day period ((of)) for the first level decision ((date)).

(b) MAA ((shall)) conduct the dispute conference within ninety calendar days of ((the receipt of)) receiving the request.

(c) ((The)) A department-appointed conference chairperson ((shall)) issues the final decision within thirty calendar days of the conference. Extensions of time for extenuating circumstances may be granted if all parties agree.

(d) ((MAA may grant extensions of time for extenuating circumstances.

(e) The effective date of dispute conference decisions regarding rate changes shall be the same as specified under subsection (2)(e) of this section.

(f))) Any rate increase of decrease resulting from a dispute conference decision is effective on the date specified in the dispute conference decision.

(e) The dispute conference ((shall be)) is the final level of administrative appeal within the department and precede judicial action.

(4) MAA ((shall construe failure on the part of the)) considers that a contractor/provider who fails to attempt to resolve disputed rates as provided in this section ((as an abandonment of)) has abandoned the dispute.

[Statutory Authority: RCW 74.08.090.  94-10-065 (Order 3732), § 388-502-0220, filed 5/3/94, effective 6/3/94.  Formerly WAC 388-81-043.]

(((1) A hospital may appeal any aspect of its Medicaid payment rates by submitting a written notice of appeal and supporting documentation to the medical assistance administration's (MAA) hospital reimbursement section, except that no administrative appeals may be filed challenging the method described herein.

(a) The grounds for rate adjustments include, but are not limited to:

(i) Errors or omissions in the data used to establish rates; and

(ii) Peer group change recommended by the Washington state department of health.

(b) The department may require additional documentation from the provider in order to complete the appeal review.  The department may conduct an audit and/or desk review if necessary to complete the appeal review.

(c) Unless the written rate notification specifies otherwise, a hospital shall file an appeal within sixty days after being notified of an action or determination the hospital wishes to challenge.  The department shall deem the notification date of an action or determination the date of the written rate notification letter.

(i) A hospital which files an appeal within the sixty-day period described in subsection (1)(c) of this section shall be eligible for retroactive rate adjustments if it prevails.

(ii) The department shall not consider a hospital rate appeal filed after the sixty-day period described in this subsection for retroactive rate adjustments.

(d) When a hospital appeals a rate the department may review all aspects of its rate.

(e) Unless the written rate notification specifies otherwise, the department shall deem rate changes resulting from an appeal effective as follows:

(i) Increases in rates resulting from an appeal filed within sixty days after the written rate notification letter that the hospital is challenging shall be effective retroactive to the date of the rate change specified in the original notification letter.

(ii) Increases in rates resulting from a rate appeal filed after the sixty day period or exception period shall be effective on the date the appeal was filed with the department.

(iii) A rate decrease resulting from an appeal shall be effective on the date specified in the appeal decision notification.

(2)(a) A hospital may request a dispute conference to appeal an administrative review decision.  The conference shall be conducted by the assistant secretary for the MAA or his/her designee.

(b) The hospital shall submit a request for a conference within thirty days of receipt of the administrative review decision.

(c) The department shall deem the dispute conference decision its final decision regarding rate appeals)) The hospital appeals and dispute process follows the procedures as stated in WAC 388-502-0220, Administrative appeal for contractor/provider rate reimbursement.

[Statutory Authority: RCW 74.08.090, 74.09.730, 74.04.050, 70.01.010, 74.09.200, [74.09.]500, [74.09.]530 and 43.20B.020.  98-01-124, § 388-550-5600, filed 12/18/97, effective 1/18/98.]

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