Purpose: The rules clarify the conditions under which providers may participate in and receive a supplemental payment or increased payment for providing trauma services to medical assistance clients.

     Citation of Existing Rules Affected by this Order: Amending WAC 388-550-2800 and 388-550-4800.

     Statutory Authority for Adoption: RCW 74.08.090 and 74.09.500.

      Adopted under notice filed as WSR 04-16-017 on July 23, 2004.

     Number of Sections Adopted in Order to Comply with Federal Statute: New 0, Amended 0, Repealed 0; Federal Rules or Standards: New 0, Amended 0, Repealed 0; or Recently Enacted State Statutes: New 0, Amended 0, Repealed 0.

     Number of Sections Adopted at Request of a Nongovernmental Entity: New 0, Amended 0, Repealed 0.

     Number of Sections Adopted on the Agency's Own Initiative: New 0, Amended 0, Repealed 0.

     Number of Sections Adopted in Order to Clarify, Streamline, or Reform Agency Procedures: New 2, Amended 2, Repealed 0.

     Number of Sections Adopted Using Negotiated Rule Making: New 0, Amended 0, Repealed 0;      Pilot Rule Making: New 0, Amended 0, Repealed 0; or Other Alternative Rule Making: New 2, Amended 2, Repealed 0.

     Date Adopted: September 17, 2004.

Brian H. Lindgren, Manager

Rules and Policies Assistance Unit

     (2) Beginning with services provided after June 30, 2003, MAA makes increased payments from the TCF to physicians and other clinical providers who provide trauma services to Medicaid clients, subject to the provisions in this section.

     (3) MAA makes increased payments from the TCF to physicians and other clinical providers who:

     (a) Are on the Designated Trauma Services Response Team of any department of health (DOH)-designated trauma service center;

     (b) Meet the provider requirements in this section and other applicable WAC;

     (c) Meet the billing requirements in this section and other applicable WAC; and

     (d) Submit all information MAA requires to ensure trauma services are being provided.

     (4) Except as described in subsection (5) of this section and subject to the limitations listed, MAA makes increased payments from the TCF to physicians and other eligible clinical providers:

     (a) For only those trauma services that are designated by MAA as "qualified." These qualified services must be provided to eligible fee-for-service Medicaid clients. Qualified trauma services include care provided within six months of the date of injury for surgical procedures related to the injury if the surgical procedures were planned during the initial acute episode of injury.

     (b) For hospital-based services only.

     (c) Only for Medicaid trauma cases that meet the Injury Severity Score (ISS) (a summary rating system for traumatic anatomic injuries) of:

     (i) Thirteen or greater for an adult trauma patient (a client age fifteen or older); or

     (ii) Nine or greater for a pediatric trauma patient (a client younger than age fifteen).

     (d) On a per-client basis in any DOH designated trauma service center.

     (e) At a rate of two and one-half times the current MAA fee-for-service rate for qualified trauma services, subject to the following:

     (i) MAA monitors the increased payments from the TCF during each state fiscal year (SFY) and makes necessary adjustments to the rate to ensure that total payments from the TCF for the biennium will not exceed the legislative appropriation for that biennium.

     (ii) Laboratory and pathology charges are not eligible for increased payments from the TCF. (See subsection (6)(b) of this section.)

     (5) When a trauma case is transferred from one hospital to another, MAA makes increased payments from the TCF to physicians and other eligible clinical providers, according to the ISS score as follows:

     (a) If the transferred case meets or exceeds the appropriate ISS threshold described in subsection (4)(c) of this section, eligible providers who furnish qualified trauma services in both the transferring and receiving hospitals are eligible for increased payments from the TCF.

     (b) If the transferred case is below the ISS threshold described in subsection (4)(c) of this section, only the eligible providers who furnish qualified trauma services in the receiving hospital are eligible for increased payments from the TCF.

     (6) MAA distributes increased payments from the TCF only:

     (a) When eligible trauma claims are submitted with the appropriate trauma indicator within the timeframes specified by MAA; and

     (b) On a per-claim basis. Each qualifying trauma service and/or procedure on the physician's claim or other clinical provider's claim is paid at MAA's current fee-for-service rate, multiplied by an increased TCF payment rate that is based on the appropriate rate described in subsection (4)(e) of this section. Charges for laboratory and pathology services and/or procedures are not eligible for increased payments from the TCF and are paid at MAA's current fee-for-service rate.

     (7) For purposes of the increased payments from the TCF to physicians and other eligible clinical providers, all of the following apply:

     (a) MAA may consider a request for a claim adjustment submitted by a provider only if the claim is received by MAA within one year from the date of the initial trauma service;

     (b) MAA does not allow any carryover of liabilities for an increased payment from the TCF after a date specified by MAA as the last date to make adjustments to a trauma claim for an SFY;

     (c) All claims and claim adjustments are subject to federal and state audit and review requirements; and

     (d) The total amount of increased payments from the TCF disbursed to providers by MAA in a biennium cannot exceed the amount appropriated by the legislature for that biennium. MAA has the authority to take whatever actions are needed to ensure MAA stays within the current TCF appropriation (see subsection (4)(e)(i) of this section).

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Method	Used for
Diagnoses related group (DRG) negotiated conversion factor	Hospitals participating in the Medicaid hospital selective contracting program under waiver from the federal government
DRG cost-based conversion factor	Hospitals not participating in or exempt from the Medicaid hospital selective contracting program
Ratio of costs-to-charges (RCC)	Hospitals or services exempt from DRG payment methods
Fixed per diem rate	Acute physical medicine and rehabilitation (Acute PM&R) Level B facilities and long-term acute care (LTAC) hospitals
Cost settlement	MAA-approved critical access hospitals (CAHS)

     (2) The department's annual aggregate Medicaid payments to each hospital for inpatient hospital services provided to Medicaid clients will not exceed the hospital's usual and customary charges to the general public for the services (42 CFR § 447.271). The department recoups annual aggregate Medicaid payments that are in excess of the usual and customary charges.

     (3) The department's annual aggregate payments for inpatient hospital services, including state-operated hospitals, will not exceed the estimated amounts that the department would have paid using Medicare payment principles.

     (4) When hospital ownership changes, the department's payment to the hospital will not exceed the amount allowed under 42 U.S.C. Section 1395x (v)(1)(O).

     (5) Hospitals participating in the medical assistance program must annually submit to the medical assistance administration:

     (a) A copy of the hospital's HCFA 2552 Medicare Cost Report; and

     (b) A disproportionate share hospital application.

     (6) Reports referred to in subsection (5) of this section must be completed according to:

     (a) Medicare's cost reporting requirements;

     (b) The provisions of this chapter; and

     (c) Instructions issued by MAA.

     (7) The department requires hospitals to follow generally accepted accounting principles unless federally or state regulated.

     (8) Participating hospitals must permit the department to conduct periodic audits of their financial and statistical records.

     (9) ((Under WAC 246-976-935, MAA may:

     (a) Enhance payments for trauma care provided to a client under a Title XIX Medicaid program when the trauma:

     (i) Qualifies under the trauma program; and

     (ii) Care is provided in a nongovernmental hospital designated by the department of health (DOH) as a trauma services center.

     (b) Provide an annual grant for trauma services to:

     (i) A governmental hospital certified by DOH as a trauma services center; and

     (ii) An MAA-approved critical access hospital (CAH).

     (10))) The department reimburses hospitals for claims involving clients with third-party liability insurance:

     (a) At the lesser of either the DRG:

     (i) Billed amount minus the third-party payment amount; or

     (ii) Allowed amount minus the third-party payment amount; or

     (b) The RCC allowed payment minus the third-party payment amount.

[Statutory Authority: RCW 74.08.090, 74.09.500, 74.09.035(1), and 43.88.290. 02-21-019, § 388-550-2800, filed 10/8/02, effective 11/8/02. Statutory Authority: RCW 74.08.090 and 42 U.S.C. 1395x(v), 42 C.F.R. 447.271, .11303, and .2652. 01-16-142, § 388-550-2800, filed 7/31/01, effective 8/31/01. Statutory Authority: RCW 74.09.090, 42 U.S.C. 1395x(v) and 1396r-4, 42 C.F.R. 447.271, 11303 and 2652. 99-14-027, § 388-550-2800, filed 6/28/99, effective 7/1/99. Statutory Authority: RCW 74.08.090, 42 USC 1395 x(v), 42 CFR 447.271, 447.11303, and 447.2652. 99-06-046, § 388-550-2800, filed 2/26/99, effective 3/29/99. 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, § 388-550-2800, filed 12/18/97, effective 1/18/98.]

     (a) Medically indigent (MI) program;

     (b) General assistance unemployable (GAU) program;

     (c) Alcoholism and Drug Addiction Treatment and Support Act (ADATSA) program; and

     (d) Involuntary Treatment Act (ITA)-Q program. (The ITA-Q program covers ITA services for non-Medicaid eligible clients.)

     (2) MAA exempts the following services from the state-administered programs' payment methods and reduced rates:

     (a) Detoxification services when the services are provided under an MAA-assigned provider number starting with "thirty-six." (MAA reimburses these services using the Title XIX Medicaid RCC payment method.)

     (b) Program services provided by MAA-approved critical access hospitals (CAHs) to clients eligible under state-administered programs. (MAA reimburses these services through cost settlement as described in WAC 388-550-2598.)

     (3) MAA determines:

     (a) A state-administered program RCC payment by reducing a hospital's Title XIX Medicaid RCC rate using the hospital's ratable.

     (b) A state-administered program DRG payment by reducing a hospital's Title XIX Medicaid DRG cost based conversion factor (CBCF) using the hospital's ratable and equivalency factor (EF).

     (4) MAA determines:

     (a) The RCC rate for the state-administered programs mathematically as follows:

     State-administered programs' RCC rate = current Title XIX Medicaid RCC rate x (one minus the current hospital ratable)

     (b) The DRG conversion factor (CF) for the state-administered programs mathematically as follows:

     State-administered programs' DRG CF = current Title XIX Medicaid DRG CBCF x (one minus the current hospital ratable) x EF

     (5) MAA determines payments to hospitals for covered services provided to clients eligible under the state-administered programs mathematically as follows:

     (a) Under the RCC payment method:

     State-administered programs' RCC payment = state-administered programs' RCC Rate x allowed charges

     (b) Under the DRG payment method:

     State-administered programs' DRG payment = state-administered programs' DRG CF x all patient DRG relative weight (to include any necessary high-cost outlier payment)

     (6) To calculate a hospital's ratable that is applied to both the Title XIX Medicaid RCC rate and the Title XIX Medicaid DRG CBCF used to determine the respective state-administered program's reduced rates, MAA:

     (a) Adds the hospital's Medicaid revenue (Medicaid revenue as reported by department of health (DOH) includes all Medicaid revenue and all other medical assistance revenue) and Medicare revenue to the value of the hospital's charity care and bad debts, all of which is taken from the most recent complete calendar year data available from DOH at the time of the ratable calculation; then

     (b) Deducts the hospital's low-income disproportionate share hospital (LIDSH) revenue from the amount derived in (a) of this subsection to arrive at the hospital's community care dollars; then

     (c) Subtracts the hospital-based physicians revenue that is reported in the hospital's most recent HCFA-2552 Medicare cost report received by MAA at the time of the ratable calculation, from the total hospital revenue reported by DOH from the same source as discussed in (a) of this subsection, to arrive at the net hospital revenue; then

     (d) Divides the amount derived in (b) of this subsection by the amount derived in (c) of this subsection to obtain the ratio of community care dollars to net hospital revenue (also called the preliminary ratable factor); then

     (e) Subtracts the amount derived in (d) of this subsection from 1.0 to obtain the hospital's preliminary ratable; then

     (f) Determines a neutrality factor by:

     (i) Multiplying hospital-specific Medicaid revenue that is reported by DOH from the same source as discussed in (a) of this subsection by the preliminary ratable factor; then

     (ii) Multiplying that same hospital-specific Medicaid revenue by the prior year's final ratable factor; then

     (iii) Summing all hospital Medicaid revenue from the hospital-specific calculations that used the preliminary ratable factor discussed in (f)(i) of this subsection; then

     (iv) Summing all hospital revenue from the hospital-specific calculations that used the prior year's final ratable factor discussed in (f)(ii) of this subsection; then

     (v) Comparing the two totals; and

     (vi) Setting the neutrality factor at 1.0 if the total using the preliminary ratable factor is less than the total using the prior year's final ratable factor; or

     (vii) Establishing a neutrality factor that is less than 1.0 that will reduce the total using the preliminary ratable factor to the level of the total using the prior year's final ratable factor, if the total using the preliminary ratable factor is greater than the total using the prior year's ratable factor; then

     (g) Multiplies, for each specific hospital, the preliminary ratable by the neutrality factor to establish hospital-specific final ratables for the year; then

     (h) Subtracts each hospital-specific final ratable from 1.0 to determine hospital-specific final ratable factors for the year; then

     (i) Calculates an instate-average ratable and an instate-average ratable factor used for new hospitals with no prior year history.

     (7) MAA updates each hospital's ratable annually on August 1.

     (8) MAA:

     (a) Uses the equivalency factor (EF) to hold the hospital specific state-administered programs' DRG CF at the same level prior to rebasing, adjusted for inflation; and

     (b) Calculates a hospital's EF as follows:

     EF = State-administered programs' prior DRG CF divided by current Title XIX Medicaid DRG CBCF x (one minus the prior ratable)

     (9) Effective December 1, 1991, for hospital admissions of clients eligible under the state-administered MI program, MAA:

     (a) Further reduces RCC and DRG payments to a hospital for covered services provided to clients eligible under the MI program by multiplying the respective payment referred to in subsection (5) of this section by ninety-seven percent; and

     (b) Applies this payment reduction to the medically indigent disproportionate share hospital (MIDSH) payment methodology in accordance with section 3(b) of the "Medicaid Voluntary Contributions and Provider-Specific Tax Amendment of 1991."

     (((10) Under WAC 246-976-935, MAA may:

     (a) Enhance payments for trauma care provided to a client eligible under the MI program or GAU program when the trauma:

     (i) Qualifies under the trauma program; and

     (ii) Care is provided in a nongovernmental hospital designated by DOH as a trauma services center.

     (b) Provide an annual grant for trauma services to:

     (i) A governmental hospital certified by DOH as a trauma services center; and

     (ii) An MAA-approved critical access hospital (CAH).))

[Statutory Authority: RCW 74.08.090, 74.09.500, 74.09.035(1), and 43.88.290. 02-21-019, § 388-550-4800, filed 10/8/02, effective 11/8/02. Statutory Authority: RCW 74.08.090 and 42 U.S.C. 1395x(v), 42 C.F.R. 447.271, .11303, and .2652. 01-16-142, § 388-550-4800, filed 7/31/01, effective 8/31/01. Statutory Authority: RCW 74.09.080, 74.09.730, 42 U.S.C. 1395x(v) and 1396r-4, 42 C.F.R. 447.271 and 2652. 99-14-026, § 388-550-4800, filed 6/28/99, effective 7/1/99. Statutory Authority: RCW 74.08.090, 42 USC 1395 x(v), 42 CFR 447.271, 447.11303, and 447.2652. 99-06-046, § 388-550-4800, filed 2/26/99, effective 3/29/99. 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, § 388-550-4800, filed 12/18/97, effective 1/18/98.]

     (2) Beginning with trauma services provided after June 30, 2003, MAA makes supplemental distributions from the TCF to qualified hospitals, subject to the provisions in this section.

     (3) To qualify for supplemental distributions from the TCF, a hospital must:

     (a) Be designated or recognized by the department of health (DOH) as an approved Level 1, Level 2, or Level 3 adult or pediatric trauma service center. No distinction is made between a governmental and nongovernmental hospital;

     (b) Meet the provider requirements in this section and other applicable WAC;

     (c) Meet the billing requirements in this section and other applicable WAC;

     (d) Submit all information MAA requires to ensure services are being provided; and

     (e) Comply with DOH's Trauma Registry reporting requirements.

     (4) Supplemental distributions from the TCF are:

     (a) Determined as a percentage of a fixed amount for each hospital based on all of the following:

     (i) The relative amount paid by MAA for inpatient and outpatient trauma care the hospital provides to Medicaid clients per quarter in a state fiscal year (SFY). MAA determines the amount of care provided to Medicaid clients by date of service, not date of payment; and

     (ii) The amount paid by MAA to hospitals that receive transferred trauma cases, regardless of the clients' Injury Severity Score (ISS) (a summary rating system for traumatic anatomic injuries).

     (b) Paid only for a Medicaid trauma case that meets:

     (i) The ISS of thirteen or greater for an adult trauma patient (a client age fifteen or older);

     (ii) The ISS of nine or greater for a pediatric trauma patient (a client younger than age fifteen); or

     (iii) The conditions of subsection (4)(c) of this section are met.

     (c) Made to hospitals, as follows, for a trauma case that is transferred:

     (i) The receiving hospital qualifies for payment regardless of the ISS; and

     (ii) The transferring hospital qualifies for payment only if the requirements in (b)(i) or (b)(ii) of this subsection are met.

     (d) Not funded by disproportionate share hospital (DSH) funds; and

     (e) Not distributed by MAA to:

     (i) Trauma service centers designated or recognized as Level 4 or Level 5; or

     (ii) Critical access hospitals (CAHs).

     (5) MAA makes supplemental distributions from the TCF to eligible hospitals as follows:

     (a) Quarterly payments are made, subject to the following:

     (i) The first quarterly supplemental distribution from the TCF is made six months after the SFY begins;

     (ii) Each quarterly supplemental distribution from the TCF totals twenty percent of the amount designated by MAA for that SFY. If claims data for any quarter indicate an insufficient number of paid claims, MAA may adjust the percentage to allow for an equitable distribution from the TCF for that quarter. See (4)(a) of this subsection.

     (b) A final supplemental distribution from the TCF is:

     (ii) Made one year after the end of the SFY; and

     (ii) Based on the SFY that the TCF designated amount relates to.

     (6) For purposes of the supplemental distributions from the TCF, all of the following apply:

     (a) MAA may consider a request for a claim adjustment submitted by a provider only if the request is received by MAA within one year from the date of the initial trauma service;

     (b) MAA does not allow any carryover of liabilities for a supplemental distribution from the TCF after a date specified by MAA as the last date to make adjustments to a trauma claim for an SFY;

     (c) All claims and claim adjustments are subject to federal and state audit and review requirements; and

     (d) The total amount of supplemental distributions from the TCF disbursed to eligible hospitals by MAA in any current biennium cannot exceed the amount appropriated by the legislature for that biennium. MAA has the authority to take whatever actions necessary to ensure MAA stays within the current TCF appropriation.

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     Reviser's note: The typographical error in the above section occurred in the copy filed by the agency and appears in the Register pursuant to the requirements of RCW 34.08.040.

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