WSR 01-09-078

PROPOSED RULES

DEPARTMENT OF

SOCIAL AND HEALTH SERVICES
(Mental Health Division)

[ Filed April 17, 2001, 3:42 p.m. ]

Supplemental Notice to WSR 01-07-116.

Preproposal statement of inquiry was filed as WSR 00-08-048.

Title of Rule: Chapter 388-865 WAC, Community mental health and involuntary treatment, formerly chapter 388-860 WAC, Juvenile involuntary treatment, chapter 388-861 WAC, Commitment, treatment and/or evaluation of mentally ill persons, and chapter 388-865 WAC, Community mental health treatment programs: WAC 388-865-0201 Allocation of funds to RSN/PHPs, 388-865-0203 Allocation formula for state hospital beds, and 388-865-0504 Exception to rule -- Long-term certification.

Purpose: This supplemental filing contains the following changes from the original proposal WSR 01-07-116:

Includes the specific distribution formulas in WAC 388-865-0201 and 388-865-0203 rather than referencing them as in the original proposal.
Proposes for permanent adoption, WAC 388-865-0504, currently an emergency rule. This section was omitted from the original proposal.
Withdraws proposed WAC 388-865-0307 from WSR 01-07-116.

Statutory Authority for Adoption: RCW 71.05.560, 71.24.035 (5)(c), 71.34.800, 9.41.047, and 43.20B.020, 43.20B335 [43.20B.335].

Statute Being Implemented: Chapters 71.05, 71.24, and 71.34 RCW.

Summary: These revisions have been made in response to stakeholder input.

Name of Agency Personnel Responsible for Drafting: Kathy Burns Peterson, OB-2, Olympia, Washington, (360) 902-0843; Implementation and Enforcement: Darleen Vernon, OB-2, Olympia, Washington, (360) 902-0873.

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

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

Explanation of Rule, its Purpose, and Anticipated Effects: WAC 388-865-0201 describes a new formula for distributing funds to RSN/PHPs, and the process for phasing in the new formula.

WAC 388-865-0203 describes a new formula for allocating state hospital beds to RSN/PHPs, and the process for phasing in the allocation process.

WAC 388-865-0504 describes the process for an inpatient evaluation and treatment facility to be certified to provide treatment to adults on ninety or one hundred eighty-day patient involuntary commitment orders.

Proposal Changes the Following Existing Rules: The proposed changes will place the allocation formulas into rule.

No small business economic impact statement has been prepared under chapter 19.85 RCW. Division staff have analyzed the proposed rule amendments and conclude that no new costs will be imposed on small businesses affected by the amendments. The preparation of a comprehensive SBEIS is not required. For information contact (360) 902-0830.

RCW 34.05.328 applies to this rule adoption. Portions of the rule making do not meet the definition of significant legislative rules. An analysis has been prepared. Please contact Kelly Cooper, (360) 664-6094 to receive a copy.

Hearing Location: Blake Office Park (behind Goodyear Courtesy Tire), 4500 10th Avenue S.E., Rose Room, Lacey, WA 98503, on May 22, 2001, at 10:00 a.m.

Assistance for Persons with Disabilities: Contact Kelly Cooper, DSHS Rules Coordinator, by May 17, 2001, phone (360) 664-6094, TTY (360) 664-6178, e-mail coopeKD@dshs.wa.gov.

Submit Written Comments to: Identify WAC Numbers, DSHS Rules Coordinator, Rules and Policies Assistance Unit, P.O. Box 45850, Olympia, WA 98504-5850, fax (360) 664-6185, by May 22, 2001.

Date of Intended Adoption: No sooner than May 23, 2001.

April 13, 2001

Brian H. Lindgren, Manager

Rules and Policies Assistance Unit

2920.3
NEW SECTION
WAC 388-865-0201   Allocation of funds to RNS/PHPs.   This section describes how Medicaid and community mental health funds are allocated to the RSN/PHPs.

(1) Funding allocations are projected at the beginning of each fiscal year, using forecasted Medicaid enrollees for that fiscal year.

(2) Payments are made on the number of actual Medicaid enrollees each month, which may result in actual payments being higher or lower than projected payments, depending on whether actual Medicaid enrollees are more or less than forecasted enrollees.

(3) The mental health division (MHD) uses two different methodologies to allocate funds:

(a) Historical method;

(b) Prevalence method.

(4) For the period July 1, 2001 to June 30, 2005, the funds will be allocated using the methodologies as follows:

(a) For July, 1, 2001 to June 30, 2002, seventy-five percent of funds of will be allocated using the historical method and twenty-five percent of funds will be allocated using the prevalence method;

(b) For June 1, 2002 to June 30, 2003, fifty percent of funds will be allocated using the historical method and fifty percent of funds will be allocated using the prevalence method;

(c) For June 1, 2003 to June 30, 2004, twenty-five percent of funds will be allocated using the historical method and seventy-five percent of funds will be allocated using the prevalence method;

(d) For June 1, 2004 forward, one hundred percent of funds will be allocated using the prevalence method. These percentages will remain in effect unless the department is directed otherwise by the state Legislature.

(5)(a) Historical method means that federal Medicaid funds projected to be paid to the RSN/PHPs are calculated using actuarially determined per member per month (PMPM) rates multiplied by the number of persons enrolled in the Medicaid program each month during the fiscal year.

(b) The actuarially determined rates were determined at the beginning of the managed care program (1992 for outpatient services and 1997 for inpatient services) and have been increased periodically by the Legislature.

(i) Rates differ by RSN and by category of enrollee (disabled and nondisabled adults and disabled and non-disabled children).

(ii) These rates are tracked by MHD.

(iii) The number of Medicaid enrollees is tracked by the medical assistance administration.

(c) The product of rates and enrollees is the projected amount of Medicaid funding each RSN/PHP will receive during the year.

(i) This amount is divided into two portions - federal funds and state match funds.

(ii) The two portions of Medicaid funds are determined by a percentage known as the Federal Medicaid Assistance Percentage (FMAP). This percentage is set by the federal Health Care Financing Authority and changes each year.

(d) In the inpatient program, each RSN/PHP is allocated the amount of federal and state funds projected in the calculations explained above.

(e) State funds in the outpatient program (also called "consolidated") to be paid to the RSN/PHPs are set by the Legislature. These funds are allocated to the RSN/PHPs according to the RSN/PHP's calculated percentage of the total funds. The RSN/PHP's percentage is based primarily on historical fee-for-service data.

(i) The RSN/PHP percentages are tracked by MHD and are carried forward each year.

(ii) The percentage of consolidated funds paid to each RSN/PHP is adjusted each year by the Legislature through budget proviso direction, generally requiring that new funds in the program be allocated according to Medicaid enrollees in each RSN. Therefore, the amount of consolidated funds in the outpatient program at the beginning of the fiscal year (also called "base funds") are allocated according to the percentage tracked by MHD (put in place by the Legislature in the previous year).

(iii) New consolidated funds are allocated as directed by the Legislature, generally according to the number of Medicaid enrollees residing in each RSN.

(f) The base allocation and new consolidated allocations are combined into one percentage that serves as the RSN/PHP's percentage allocation for the next year's base funds.

(g) The sum of federal Medicaid funds, state match funds in the inpatient program, and consolidated funds equals the amount of funding provided to each RSN/PHP.

(6) Prevalence method.

(a) Medicaid and non-medicaid funds are allocated based on a formula that reflects prevalence of mental disorders in each county. The formula takes into consideration each RSN's:

(i) Concentrations of priority populations;

(ii) Commitments to state hospitals under chapter 71.05 and 71.34 RCW;

(iii) Population concentrations in urban areas;

(iv) Population concentrations at border crossings at state boundaries; and

(v) Other demographic and workload factors such as number of MI/GA-U clients, commitments to community hospitals under chapter 71.05 and 71.34 RCW, and number of homeless persons.

(b) The RSN/PHP historical method rates for 2001 have been used to calculate a weighted average statewide rate (WASR) for each category of Medicaid eligible (disabled and nondisabled adults and disabled and nondisabled children).

(c) The WASR for each category is determined by:

(i) Adding the RSN/PHP's inpatient and outpatient rates to create one combined rate;

(ii) Multiplying each RSN/PHP's rate by the number of Medicaid enrollees residing in that RSN/PHP;

(iii) Adding the results; and

(iv) Dividing the sum by the state-wide number of Medicaid eligibles.

(d) WASR rates are tracked by MHD.

(e) The number of Medicaid enrollees is tracked by the medical assistance administration.

(f) To project the amount of Medicaid funding each RSN/PHP will receive during the year, MHD multiplies the RSN/PHP's WASR for each category by the projected number of Medicaid enrollees in each category.

(i) This amount is divided into two portions - federal funds and state match funds.

(ii) Each RSN/PHP's projected allocation includes both portions of Medicaid funding (federal and state match funds).

(iii) Payments to the RSN/PHP are made based on the actual number of Medicaid enrollees.

(g) The level of non-Medicaid funds appropriated to the community mental health services program is determined by the state Legislature.

(i) Eighty percent of the non-Medicaid funds appropriated are allocated to the RSN/PHPs according to the number persons enrolled in the state funded general assistance - unemployable, medically indigent and state only "v" programs (persons in the state only "v" program are counted at thirteen percent of the total enrolled).

(A) The number of persons enrolled in these programs is tracked by the medical assistance administration.

(B) The projected number of persons in these programs residing in each RSN, divided by the total persons projected to be in these programs, is multiplied by eighty percent of the total funds appropriated to determine the amount of funding provided to each RSN/PHP.

(ii) Twenty percent of the non-Medicaid funds appropriated are allocated according to a summary z score factor that is calculated using four sub-factors:

(A) The number of urban counties in each RSN;

(B) The number of border counties in each RSN;

(C) The number of homeless persons in each RSN; and

(D) The number of ITA commitments from each RSN.

These sub-factors are weighted differently, with the urban factor weighted at 0.3, the border county factor weighted at 0.05, the homeless factor weighted at 1.0 and the ITA commitments factor weighted at 0.2. For each of these factors, information is tracked by MHD and the most recent complete year of data is used to calculate z score factors for each sub-factor. These factors are combined into a summary z score factor for each RSN that is multiplied by the total funding available (twenty percent of non-Medicaid funds appropriated).

(7) The mental health division does not pay providers on a fee-for-service basis for services that are the responsibility of the mental health RSN or PHP, even if the RSN or PHP has not paid for the service for any reason.

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NEW SECTION
WAC 388-865-0203   Allocation formula for state hospital beds.   The mental health division (MHD) allocates nonforensic adult beds at the state hospital utilized by the regional support network (RSN) based on the number of beds funded by the Legislature at that hospital.

(1) The allocation formula is (M x 40 %)+(U x 35%)+(P x 25%) x F.

(a) M is the average number of Medicaid eligible persons in the RSN during the period of July to December prior to the start of the biennium, divided by the average number of Medicaid eligible persons in the hospital catchment area during the same period;

(b) U is the number of hospital beds utilized by the RSN during the period of July to December prior to the start of each biennium divided by the average daily census at the hospital utilized by the RSN during the same period;

(c) P is the percent of the general population that resides within the RSN based on the most recent population estimate on December 1 of the year prior to the start of the biennium divided by the general population in the hospital catchment area at the same time;

(d) F is the total number of funded nonforensic beds at the hospital;

(e) The MHD will project and distribute tentative allocations upon issuance of the Governor's budget, and upon enactment of the Legislative budget. The operative allocation will be made and distributed at the start of each fiscal year.

(2) This formula will be phased in as follows:

(a) For July 1, 2001 to June 30, 2002, twenty five percent of the bed allocation will be based on the new formula, and seventy five percent based on the 1999-2001 allocation;

(b) For July 1, 2002 to June 30, 2003, fifty percent of the allocation will be based on the new formula and fifty percent based on the 1999-2001 allocation;

(c) For July 1, 2003 to June 30, 2004, seventy-five percent of the allocation will be based on the new formula and twenty-five percent based on the 1999-2001 allocation;

(d) For July 1, 2004 to June 30, 2005 one hundred percent of the allocation will be based on the new formula;

(e) The formula will be recalculated on or about April 4, 2005 and each biennium thereafter based on data that is current at that time.

(3) If the in-residence census exceeds the funded capacity on any day or days within the fiscal year, the MHD will assess liquidated damages calculated on the following formula:

(a) Only RSNs who are in excess of their individual allocated census on the day or each day of over census will be assessed liquidated damages;

(b) The amount of liquidated damages charged for each day will be the number of beds over the funded capacity of the hospital multiplied by the state hospital daily bed charge consistent with RCW 43.20B.325;

(c) The amount of liquidated damages charged to each RSN will be a percentage based on the number of beds over their allocation divided by the total number of beds over the funded capacity on the day or each day of over census;

(d) The liquidated damages will be recovered by the MHD by a deduction from the monthly payment made by the MHD two months after the end of the month in which the in residence census exceeded the state bed allocation of that RSN.

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NEW SECTION
WAC 388-865-0504   Exception to rule -- Long-term certification.   (1) At the discretion of the mental health division, a facility may be granted an exception to WAC 388-865-0229 in order to allow the facility to be certified to provide treatment to adults on ninety-or one hundred eighty-day inpatient involuntary commitment orders.

(2) The exception certification may be requested by the facility, the director of the mental health division or his designee, or the RSN for the facility's geographic area.

(3) The facility receiving the exception certification for ninety- or one hundred eighty-day patients must meet all requirements found in chapter 388-865 WAC for the evaluation and treatment facility short-term inpatient component.

(4) The exception certification must be signed by the director of the mental health division. The exception certification may impose additional requirements, such as types of patients allowed and not allowed at the facility, reporting requirements, requirements that the facility immediately report suspected or alleged incidents of abuse, or any other requirements that the director of the mental health division determines are necessary for the best interests of patients.

(5) The mental health division may make unannounced site visits at any time to verify that the terms of the exception certification are being met. Failure to comply with any term of the exception certification may result in corrective action or, if the mental health division determines that the violation places patients in imminent jeopardy, immediate revocation of the certification.

(6) Neither consumers nor facilities have fair hearing rights as defined under chapter 388-02 WAC regarding the decision to grant or not to grant exception certification.

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Washington State Code Reviser's Office