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LeadingAge Ohio reported last week that in response to the forty-seven (47) line item vetoes by Governor Kasich to HB 49 (Smith) Operating budget, the Ohio House of Representatives returned on July 6 to override eleven (11) of the Governor’s vetoes, most of which were directed at the Medicaid budget. The Governor’s veto messages explained why each item would create a challenge to manage the Medicaid program, but the House’s overrides reflect its difference of opinion.
Specifically, the House overrode two of the Governor’s vetoes in areas related to long-term services and supports. The veto override process is complicated — as the House’s overrides must be confirmed by the Senate’s own override process — but, in summary, if the Senate were to concur, the House’s actions: 1) delay the Administration’s authority to move the remaining LTSS population to Medicaid managed care; and 2) allow changes to nursing home reimbursement some of which go into effect in 2020. See below for additional detail on the budget process thus far related to both of these areas. Please note, the final budget bill removed the Administration’s authority to make any of their proposed cuts to nursing home reimbursement. In addition, the final budget bill contains the spending cap for nursing homes as proposed by the legislature.
Before the House adjourned, it kept open the possibility of bringing forward the remaining vetoes for consideration. The Senate must confirm these overrides with its own vote in order for the overrides to become part of the bill. Initially, the Senate was expected to take up the House’s veto-overrides in July, however, those Session dates have since been cancelled. The Ohio General Assembly has the remainder of its session, which concludes on December 31, 2018, to take up any vetoes. However, with the effective date of the bill 90 days from signing, any overrides must be filed with the Secretary of State’s office prior to October 1. To read more details on the vetoes the House voted to override, click here.
In response to the Governor’s veto message, the Office of Health Transformation (OHT) issued its position on the appropriation gap it believes exists in the final version of the budget. Based on OHT's assertion that the program is underfunded, the Ohio Department of Medicaid (ODM) plans to schedule meetings beginning this July with stakeholders to discuss provider rate cuts; ODM's goal is to finalize the rates by October 1. Since nursing home rates are protected in statute, they will not be included in any rate reductions through a regulatory process, however home and community based services could be impacted. As such, the Medicaid budget remains in flux until the Senate decides if it will take action on any of the House overrides. We will continue to work with Senators and the Administration and provide updates as more information becomes available.
Included below is a brief summary of the significant issues related to LTSS. For each of the issues, we first present the language passed in Conference Committee (the Conference Committee process reconciles the differences between the House and Senate versions of the bill). We then follow this language with the exact language used in the Governor’s veto for each; we conclude with the vote count by which the House overrode the Governor’s veto.
As Passed by Conference Committee:
Summary
The Conference Committee prohibited the move of nursing facility services and home- and community-based services to Medicaid managed care unless the General Assembly (GA) voted to include these services (it also removed the Senate introduced deadline of December 31, 2018 by which the GA had to vote). If the GA votes to include nursing facility services and home-and community-based services in MLTSS then the Senate renamed “patient-centered medicaid long-term care delivery system advisory committee”-- of which LeadingAge Ohio is a named participant-- would go into effect. Click here to see the actual bill language.
The Governor’s Veto Message:
Long-Term Services Added to Medicaid Managed Care
“This provision would prohibit nursing facilities, as well as home and community-based waiver services, with limited exceptions, from being added to Medicaid managed care at any time prior to the General Assembly enacting legislation authorizing the addition. This provision also creates a temporary study committee to examine the merits of including these services in the managed care system. By unnecessarily delaying the Department of Medicaid's ability to move Ohioans receiving these services into managed care, this provision would unreasonably delay or even totally deny the benefits of care coordination to Medicaid recipients with the most complex needs, as well as deny Ohio taxpayers the benefit of the increased efficiency provided by managed care models of care delivery. Such models have already proven to improve value and quality for both Ohio taxpayers and the vulnerable Ohioans who depend on Medicaid. Therefore, this veto is in the public interest.” Click here for the link to the Governor’s veto text.
The House voted to override the Governor’s veto by a vote of 95-2.
As Passed by Conference Committee
Summary
The Conference Committee retained House and Senate revisions to the nursing facility rate formula that included the following:
- Allows the use of the index maximizer element of the grouper methodology used in determining nursing facilities' case-mix scores.
- Eliminates the requirement that a nursing facility have been awarded at least five points for meeting accountability measures in order to qualify as a critical access nursing facility.
- Eliminates the rate add on from the portions of a nursing facility's total rate that are used in determining a critical access nursing facility's incentive payment.
- Makes changes to the quality indicators by replacing potentially preventable admissions with unplanned weight loss and adds language that provides an exclusion for nursing facility patients on hospice care receiving an anti-psychotic from the quality measure calculation.
- Provides for adjustments beginning in FY 2020 in an amount that equals the difference between the Medicare skilled nursing facility market basket index and a budget reduction adjustment factor.
- States the General Assembly's intent to enact laws that specify the budget reduction adjustment factor for each fiscal year.
- Sets the budget reduction adjustment factor at zero for a fiscal year if the General Assembly fails to enact such a law for that year.
- Requires ODM to rebase nursing facilities' cost centers at least once every five fiscal years instead of not more than once every ten years and requires each cost center to be rebased for the same fiscal years.
- Provides for a new nursing facility's initial rate for tax costs to be an amount determined by dividing its projected tax costs for the calendar year in which it begins to participate in Medicaid by a 100% imputed occupancy rate if the nursing facility submits the projected tax costs to ODM.
In addition, it includes a cost-containment cap measure introduced in the House whereby the total amount of payments for nursing facility services provided under Medicaid fee-for-service and MyCare Ohio cannot exceed $2,659,167,368 for fiscal year 2018 and $2,664,485,703 for fiscal year 2019. Requires that nursing facilities' rates be decreased as necessary to ensure that the total amount of the payments equals those amounts. Click here to see the actual bill language. (reference pages 1962-2002 and 3150-3151)
The Governor’s Veto Message:
Medicaid Rates for Nursing Facilities
“This provision would make numerous changes in the formula used to determine Medicaid payment rates for nursing facility services, including eliminating portions of the reimbursement formula that are focused on quality and accountability measures. This provision imposes on the Medicaid director's executive authority to effectively and efficiently manage Ohio's Medicaid program and to maintain the fiscal and programmatic integrity the Administration has established for that program by restricting the Director's ability to establish rates that best ensure the quality and efficiency of Medicaid nursing facility programs. Therefore, this veto is in the public interest.” Click here for the Governor’s veto text. (Please note that the Governor’s veto reverts the Fee-for Service nursing facility rate to its current language in statute).
The House voted to override the Governor’s veto by the vote of 96-1.
Click here to review the entire budget bill.
Click here to review the Governor's veto text.
LeadingAge Ohio will continue to provide an update on further developments on the budget and alert members should their calls for action be required. Questions related to the budget process and advocacy may be directed to Nisha Hammel, Director of Advocacy at nhammel@leadingageohio.org.
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