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Pennsylvania Medicaid School Based Claiming
SBAP Annual Cost Report Training
March 2014
www.publicconsultinggroup.com
Agenda
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Goals
Programmatic Changes to the School-Based ACCESS
Program (SBAP)
Roles and Responsibilities
Annual Medicaid Cost Reporting Requirements
Direct Service Cost Reporting Requirements
Cost Settlement Calculation
Desk Review Overview
Timeline of Events
Contacts
Questions
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Goals
The purpose of this training is to help LEAs:
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Understand the cost reporting process;
Learn program requirements and responsibilities;
Understand the implications of reporting or failure to
accurately report; and
Understand the Medicaid cost settlement calculation and
how the various contributing factors impact the
calculation.
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Programmatic Changes to the School-Based
ACCESS Program (SBAP)
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Programmatic Changes to SBAP
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Effective July 1, 2013 the Centers for Medicare and Medicaid Services
(CMS) approved the amendment to the Pennsylvania Medicaid State
Plan to implement an annual Medicaid cost reimbursement and cost
settlement process for the School-Based ACCESS Program (SBAP).
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CMS made a national push to implement a standardized reimbursement
process to ensure proper reimbursement to LEAs for direct medical school
based services: cost based reimbursement.
What is cost based reimbursement?
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A cost based reimbursement methodology determines the actual cost of
delivering direct medical services to special education students.
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Cost based reimbursement ensures that LEAs are reimbursed their costs for the
delivery of Medicaid allowable direct medical services.
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Programmatic Changes to SBAP
How will cost based reimbursement impact LEAs?
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In order to identify the costs of delivering Medicaid school-based services, LEAs will
participate in an annual cost settlement process.
The cost settlement process will include the submission of an annual Medicaid cost
report.
LEAs will complete an annual Medicaid cost report online at
https://costreporting.pcgus.com/pa.
The Medicaid cost report calculates the actual costs of providing Medicaid covered
health related services and will be compared to Medicaid reimbursement received
through SBAP interim payments for the fiscal year.
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Interim payments are those payments received by the LEA through the fee-for-service billing
activities throughout the fiscal year. These payments DO NOT include payments received for
the quarterly MAC claims.
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Programmatic Changes to SBAP
Historical Approach to School Based Medicaid Programs
Fee for Service
(FFS)
Medicaid
Administrative
Claiming
(MAC)
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LEA $
LEA $
“Compartmentalized” programs with minimal integration
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Unbalanced LEA participation in both programs
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Some LEAs participated in MAC and FFS or just MAC or FFS
Various compliance issues in both programs
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One reason the Federal government proposed to eliminate MAC
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Programmatic Changes to SBAP
Current Approach to School Based Medicaid
Programs
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Programs now work together
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Integrated single time study for Medicaid
Administrative Claiming (MAC) and FFS
reimbursement
Focus on overall reimbursement and
reimbursement of actual costs
Balanced participation in ALL areas by LEAs
Combined statewide and LEA operational model
Improved CMS clarity/compliance
Reimbursement that reflects LEA’s cost in
treating Medicaid eligible students
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Submission of annual Medicaid cost reports
required
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Roles and Responsibilities
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Roles and Responsibilities
Role of the LEA
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Participate in the Random Moment Time Study (RMTS)
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Ensure all Medicaid eligible providers are included in the cost report
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Submit a participant list for inclusion in the quarterly RMTS
The list of Medicaid eligible providers on the cost report must be the same as the participant
list submitted for the RMTS
Prepare and submit completed annual cost report
Role of PCG and the PA Department of Public Welfare
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Desk reviews of the submitted cost reports
Complete Medicaid cost report audits
Process Medicaid cost settlements
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Roles and Responsibilities
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SBAP allows districts to receive reimbursement for the cost of providing PA Medicaid
covered services to Medicaid eligible, special education students.
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Revenue available only when Federal and State Medicaid requirements are met.
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SBAP Annual Medicaid Cost Reporting
Requirements
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SBAP Annual Medicaid Cost Reporting
Requirements
LEA requirements for participation in SBAP:
1. Continue submitting direct service claims;
2. Include direct service staff in the Random Moment Time Study (RMTS);
3. Report costs for direct service staff on a quarterly and annual basis;
4. Report costs annually on an accrual basis; and
5. Include only allowable costs on the cost report.
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SBAP Annual Medicaid Cost Reporting
Requirements
1. LEAs are required to continue with direct service documentation and
claiming processes throughout the year.
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LEAs will continue to receive interim payments on approved claims.
Interim claiming will remain a critical component in the direct service
reimbursement process.
LEAs should submit direct service claims for staff participants included in the
quarterly time study.
In order to receive Medicaid reimbursement, LEAs must continue to adhere to
the participation agreement and program requirements.
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SBAP Annual Medicaid Cost Reporting
Requirements
2. LEAs must include direct service staff providing health related services to
special education students on the random moment time study (RMTS) staff
pool list.
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Each LEA must determine the appropriate staff to include in the time study on a
quarterly basis.
• If participants are inadvertently omitted from the time study, costs incurred for these
participants will not be recognized in the cost settlement process.
• It is essential for LEAs to carefully identify and include direct service providers on a
roster to participate in the quarterly time study.
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SBAP Annual Medicaid Cost Reporting
Requirements
3. LEAs are required to report costs for direct service staff on a quarterly and
annual basis.
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The cost settlement process directly links to both the quarterly financial
submissions and the RMTS.
Each LEA will report the quarterly and annual costs for their staff included in the
time study staff pool.
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SBAP Annual Medicaid Cost Reporting
Requirements
4. All costs captured on the SBAP Annual Medicaid Cost Report must be
reported on an accrual basis.
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This is a requirement within the Medicaid State Plan and Cost Reporting Guide
approved by the Centers for Medicare and Medicaid Services (CMS).
Under an accrual based accounting methodology, expenses are recorded at the
time in which the transaction occurs, rather than when the payment is made.
Expenses are counted when the LEA receives the goods or services. The LEA
does not have to wait until the expense is actually paid to record a transaction.
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SBAP Annual Medicaid Cost Reporting
Requirements
4. All costs captured on the SBAP Annual Medicaid Cost Report must be
reported on an accrual basis.
Example of Accrual Based Reporting:
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In July 2012, the LEA pays salaries and benefits for the last two weeks of June
2012.
This expense occurred in July 2012, but pertained to services provided in June
2012.
This expense should be recorded on the July-June 2012 annual cost report when
the transaction occurred, not when it was paid.
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SBAP Annual Medicaid Cost Reporting
Requirements
5. Only allowable costs approved by CMS can be reported on the cost report.
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CMS approved a cost reimbursement methodology that includes a number of data elements
(listed on the following slides).
The CMS-approved cost and data elements related to direct medical services include:
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Salary costs for eligible direct service providers;
Benefit costs for eligible direct service providers;
Purchased Professional Services (PPS) costs for eligible direct service providers;
Approved Direct Medical Service Materials and Supplies costs;
Depreciation costs for Approved Direct Medical Service Equipment;
Annual Tuition Costs;
Pennsylvania Department of Education Unrestricted Indirect Cost Rate (UICR) (pre-populated by
PCG);
Random Moment Time Study (RMTS) Direct Medical Service Percentage Results (pre-populated by
PCG); and
Individualized Education Program (IEP) Ratio.
Please ensure your LEA maintains all documentation to support allowable costs
reported.
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SBAP Annual Medicaid Cost Reporting
Requirements
5. Only allowable costs defined by CMS can be reported on the cost report.
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The CMS-approved cost elements related to transportation include:
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Salary costs for eligible transportation staff;
Benefit costs for eligible transportation staff;
PPS costs for eligible transportation staff;
Other allowable transportation costs (such as fuel, insurance, etc.); and
Depreciation costs for approved transportation service equipment.
Please ensure your LEA maintains all documentation to support allowable
costs reported.
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SBAP Annual Medicaid Cost Reporting
Requirements
In summary,
1. Continue submitting direct service claims;
2. Include direct service staff in the random moment time study (RMTS);
3. Report costs for direct service staff on a quarterly and annual basis;
4. Report costs annually on an accrual basis; and
5. Include only allowable costs on the cost report.
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Direct Service Cost Reporting Process and
Requirements
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Reporting Allowable Direct Service Costs
Direct Service Payroll Information
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Reporting Allowable Direct Service Costs
Direct Service Payroll Information
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Medicaid allowable costs in the SBAP annual cost report must relate to one
of the direct services listed below, which are clearly outlined in the
Pennsylvania Cost Reporting Manual.
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Reimbursable services under the Direct Service program include:
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Nursing Services;
Nurse Practitioner Services;
Occupational Therapy Services;
Orientation, Mobility and Vision Services;
Personal Care Services;
Physical Therapy Services;
Physician Services;
Psychological (including psychiatric), Counseling and Social Work Services;
Speech, Language and Hearing Services (including audiology and teachers for the
hearing impaired); and
• Assistive Technology Devices
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Reporting Allowable Direct Service Costs
Annual Payroll Information: Salaries, Fringe Benefits, and Contracted
Staff Costs
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Only the eligible Annual Payroll Information for the SBAP service providers who
are included in the RMTS qualify for SBAP cost reimbursement.
Columns on the Annual Payroll page indicate whether or not the individual was
listed on the SPL for the particular quarterly period
If the column is marked with a 1, the individual was included on the SPL for the
quarter and cost will be included in the SBAP cost report. If the column is
marked with a 0, the individual was not included on the SPL for the.
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Reporting Allowable Direct Service Costs
Direct Service Payroll Information:
Salaries
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Regular wages
Paid time off (e.g., sick or annual leave)
Overtime
Bonuses or longevity
Stipends
Cash bonuses and/or cash incentives
Note: Salaries are those payments from which payroll taxes are deducted. The reported
salaries should be the total gross earnings for the individual as paid by the LEA for the
reporting period.
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Reporting Allowable Direct Service Costs
Direct Service Payroll Information:
Benefits
• Employer-paid health/medical, life, disability, vision benefits, or dental
insurance premiums
• Employer-paid child day care for children of employees
• Retirement contributions
• Worker’s compensation costs
• Other employer paid benefits including unemployment and FICA
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Reporting Allowable Direct Service Costs
Direct Service Payroll Information:
Salaries and Benefits
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Only those salary and benefit staff costs for direct service providers
included on the RMTS staff pool list are eligible for direct service cost
reimbursement.
Only salaries and benefits for those service categories which the LEA billed
and received interim payments will be included in the Medicaid cost
settlement calculation.
LEAs are required to report gross expenditures as well as identifying
expenditures paid from federal funding sources.
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Reporting Allowable Direct Service Costs
Direct Service Payroll Information:
Purchased Professional Services (PPS) Costs
• Total costs of PPS for applicable contracted staff.
Note: The reported costs should be the total costs for the individual as paid by the LEA
for the reporting period. PPS costs include compensation paid for all services contracted
by the LEA for an individual who delivered any direct services to Medicaid and/or nonMedicaid students.
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Only those PPS costs for certain direct service providers that were included on the
RMTS staff pool list are eligible for direct cost reimbursement.
Only contracted service costs for those service categories which the LEA billed and
received interim payments for will be included in the Medicaid cost settlement
calculation.
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Reporting Allowable Direct Service Costs
Direct Medical Services Materials and Supplies
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What types of Material and Supply costs will be included in the cost settlement
process?
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CMS has approved a very limited list of direct medical service material, supply, and
equipment costs (Available on the MCRCS Dashboard).
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Only those items included within the approved list can be reported on the Medicaid
cost report
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Examples include: hearing aids, stethoscopes, wheelchairs, etc.
Direct Medical Service Material, Supply, and Equipment Costs applicable only to General
Education students should not be reported on the cost report
Only material and supply costs for service types – with the exception of Assistive
Technology Devices – which the LEA reports payroll or contract costs for will be
included in the Medicaid cost settlement calculation.
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Reporting Allowable Direct Service Costs
Direct Medical Services Equipment Depreciation
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What is Depreciation?
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“Depreciation” is the systematic and rational allocation of the acquisition cost of an asset
over its estimated useful life
What type of depreciation needs to be used in order to report costs on the Medicaid
Cost Report?
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Allowable depreciation expenses for direct medical services include OMB-A-87 allowable
methodologies, including pure straight-line depreciation
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Straight-line depreciation method is a method of calculating the depreciation of an asset which
assumes the asset will lose an equal amount of value each year
The annual depreciation is calculated by dividing the purchase price by the estimated useful
life of the asset
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Reporting Allowable Direct Service Costs
Direct Medical Services Equipment Depreciation
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When is it required to report direct medical service materials and supplies as
depreciated cost?
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If a single direct medical service material and supply cost exceeds $5,000, then the item
should be depreciated
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Only those items included within the approved list can be reported on the Medicaid cost
report
Only material and supply costs for service types – with the exception of Assistive
Technology Devices – which the LEA reports payroll or contract costs for will be
included in the Medicaid cost settlement calculation.
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Reporting Allowable Direct Service Costs
Direct Medical Services Equipment Depreciation
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Example 1: A wheelchair is purchased by an LEA for $6,000 on July 1, 2012 and has
a useful life of 5 years.
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How does the LEA identify what is the useful life of a wheelchair?
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The useful life of a wheelchair is estimated by the LEA
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The LEA may use industry standards in order to report the useful life of a wheelchair
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If the LEA does not have a fixed asset ledger that reports the useful life of an asset, an LEA may
consult the "Estimated Useful Lives of Depreciable Hospital Assets", published by the American
Hospital Association (AHA)
How does the LEA calculate the depreciation cost of the wheelchair?
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Depreciation cost is calculated by dividing the acquisition cost of $6,000 by the estimated useful life of
5 years
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This results in a calculated depreciation cost of $1,200 for school fiscal year 2013 (July 1, 2012 to
June 30, 2013)
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Reporting Allowable Direct Service Costs
Direct Medical Services Equipment Depreciation
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Example 2: A wheelchair is purchased by an LEA for $6,000 on October 1, 2012 and
has a useful life of 5 years
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The Medicaid cost reimbursement and settlement process was effective July 1, 2012, so this
requires the LEA to prorate the expense
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This is accomplished by dividing the annual allowable expense of $1,200 by the number of months in
the fiscal year or 12 in this case. $1,200/12 = $100 per month
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The $100 per month cost is then multiplied by 9, which is the number of months the wheelchair was in
use for the reporting period (July 1, 2012 to June 30, 2013)
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Therefore, the final allowable depreciation cost would be $900 in this example ($100 of
depreciation cost per month * 9 months = $900)
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For the remaining 4 years of the useful of the wheelchair, the allowable depreciation cost
would be $1,200 per year
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Reporting Allowable Direct Service Costs
Annual Tuition Costs
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This section identifies the reimbursable portion of tuition expenditures for approved
private schools and other school based out-of-district providers.
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The cost report must include the following:
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The specific school/agency to which tuition was paid
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The total annual tuition paid to the specific school/program
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The portion of tuition payments made using federal funds
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Reporting Allowable Direct Service Costs
Annual Tuition Costs
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The data entered will be used to calculate the Tuition Payments Net Federal Funds
(Tuition Payments) – (Federal Funds) = Tuition Payments Net Federal Funds
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This value will then be multiplied by the Health Related Percentage which is distinct
for each school/agency and will be calculated by PCG based on data from the agency
or school’s Annual Financial Report to PDE.
(Tuition Payments Net Federal Funds) x (Health Related Percentage) =
Health Related Expense
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The Health Related Expense will then be used to determine the Medicaid allowable
costs for cost settlement
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Reporting Allowable Direct Service Costs
Compensation Federal Revenues
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Reporting Allowable Direct Service Costs
Compensation Federal Revenues
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As LEAs are required to report gross expenditures, expenditures for funds
paid from federal funding sources should be appropriately identified.
The cost reporting system will automatically calculate the net expenditures
based on costs reported.
Funds received from Medicaid (interim billing, administrative etc) are not
considered Federal Funds, and should not be reported as such.
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Reporting Allowable Direct Service Costs
Unrestricted Indirect Costs
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Reporting Allowable Direct Service Costs
Unrestricted Indirect Costs
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CMS recognizes that LEAs incur indirect costs for direct service program
administration.
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Unrestricted indirect costs represent the expenses of doing business that are not
readily identified within a particular grant, contract, program, but are necessary
for the general operation of the organization to conduct the activities it performs.
The Pennsylvania Department of Education (PDE) is the cognizant agency
responsible for calculating and approving LEA indirect cost rates on behalf
of the United States Department of Education (US DOE).
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Reporting Allowable Direct Service Costs
Unrestricted Indirect Costs
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PCG will pre-populate the LEA’s unrestricted indirect cost rate (UICR) into
the Medicaid cost report form.
The UICR is applied to net direct costs (total costs less amount paid with
federal funds) in order to allow for the proper identification of indirect costs.
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Direct Medical Services Time Study
Percentages
Direct Medical Services Time Study Percentages
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Direct Medical Services Time Study
Percentages
Direct Medical Services Time Study Percentages
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Direct medical service staff have other LEA specific responsibilities other
than delivering direct medical services and CMS requires a mechanism
(RMTS) to apportion these costs.
The RMTS direct medical service percentage is applied to allowable costs
to determine what portion of these costs pertain to the provision of direct
medical services.
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Direct Medical Services Time Study
Percentages
Direct Medical Services Time Study Percentages
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The direct medical service percentage is calculated by PCG from the results
of the quarterly Random Moment Time Study (RMTS).
• The percentage will determine how much time direct service and
personal care providers spend performing allowable direct medical
services.
There is one, statewide direct medical service percentage used for the
purpose of cost reporting.
The direct medical service percentage is a statewide percentage and is not
LEA specific.
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The direct medical service percentage used within the Medicaid cost report is the
combination of the three quarterly time study periods (Oct – Dec, Jan – Mar, and
Apr – Jun) that occurred during the state fiscal year.
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Direct Medical Services Time Study
Percentages
Direct Medical Services Time Study Percentages
Example:
• If the direct medical services percentage was 41.96% and a LEA paid a
Physical Therapist $60,000 per year, the direct medical service costs would
be $25,176.
• $60,000 x .4196 = $25,176
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Individualized Education Program Ratio
Individualized Education Program (IEP) Ratio
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Individualized Education Program Ratio
Individualized Education Program (IEP) Ratio
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The purpose of the IEP ratio is to allocate direct medical service costs to the Medicaid
program.
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IEP
Ratio
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It is used to determine Medicaid’s portion of direct medical service costs incurred by LEAs.
=
Total Number of Medicaid Eligible Special Education Students with a
Prescribed Direct Medical Service in their IEP
Total Number of ALL Special Education Students with a Prescribed Direct
Medical Service in their IEP
The IEP ratio will be calculated on an annual basis for use the annual cost report.
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This ratio will differ from the Medicaid Eligibility Ratio (MER) used for the quarterly MAC
claims.
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Individualized Education Program Ratio
Individualized Education Program (IEP) Ratio
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The IEP ratio will be LEA specific and based on student count data.
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To establish the IEP ratio, LEAs need to submit a list identifying each student
with at least one direct medical service in their IEP (denominator), based on
student enrollment as of the first Wednesday of October during each July – June
school year, to PCG.
PCG will then conduct a Medicaid match to determine the total number of
Medicaid Eligible students with at least one direct medical service in their IEP
(numerator).
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Calculating Direct Service Medicaid Allowable
Costs
Direct Service Medicaid Allowable Costs
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Calculating Direct Service Medicaid Allowable
Costs
Direct Service Medicaid Allowable Costs
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Direct service costs entered in the Cost Reporting System by the LEA and
unrestricted indirect costs will be apportioned by the Direct Medical Service
Percentage and the IEP Ratio to calculate the Medicaid allowable costs.
The identified Medicaid allowable costs on the cost report will be used to
determine the cost settlement, in addition to any reported transportation
costs.
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Calculating Direct Service Medicaid Allowable
Costs
Now that we know about the SBAP Medicaid Cost Report process, how
do the pieces fit together?
Calculation
Step
Cost Report
Element #
Cost Report Element Description
Value
A
Salary Costs of SBAP Direct Service Providers
including Contract Costs (net of federal funds)
$950,000
1
B
Benefit Costs of SBAP Direct Service Providers
(net of federal funds)
$200,000
2
C
Direct Service Non Personnel Cost (net of federal
funds)
$65,000
3
D
Direct Service Non Personnel Depreciation Cost (net
of federal funds)
$24,530
4
E
Total Direct Service Costs
(net of federal funds)
(Sum of Steps A through D)
$1,239,530
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Calculation
Step
Cost Report Element Description
Value
E
Total Direct Medical Service Costs (net of federal
funds) (Sum of Steps A through D)
$1,239,530
F
Direct Medical Service % (from RMTS)
G
(Step F x Step H)
H
Out of District Tuition Costs
I
(Step G + Step H)
$756,742
J
Indirect Cost Rate
1.15
K
(Step I x Step J)
L
Individualized Education Program Ratio
M
SBAP Medicaid Eligible Direct Service Cost
(Step L × Step M)
(Calculated Cost Reimbursement)
55.00%
Cost Report
Element #
See Prior
Slide
5
$681,742
$75,000
6
7
$870,253
50.00%
8
$435,127
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Reporting Allowable Transportation Service Costs
Medicaid Allowable Costs and Cost Report Data Elements for
Specialized Transportation Services
The 7 CMS-approved cost and data elements used to determine Medicaid
costs for Specialized Transportation Services include:
1.
2.
3.
4.
Salary costs for eligible specialized transportation service providers
Benefit costs for eligible specialized transportation service providers
Approved Specialized Transportation Non Personnel costs
Depreciation costs for Approved Specialized Transportation Non
Personnel costs
5. LEA Indirect Cost Rates (ICR) (pre-populated by PCG)
6. Specialized Transportation Ratio (if needed)
7. One Way Trip Ratio
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Reporting Allowable Transportation Service Costs
1. Transportation Salary costs
Salary costs for eligible specialized transportation service providers
include:
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Regular wages or extra pay
Paid time off (e.g., sick or annual leave)
Overtime
Bonuses or longevity
Stipends
Cash Bonuses and/or cash incentives
Note: Salaries are those payments from which payroll taxes are deducted. The
reported salaries should be the total gross earnings for the individual as paid by the
LEA for the reporting period
54
Reporting Allowable Transportation Service Costs
2. Transportation Benefits Costs
Benefit costs for eligible specialized transportation service providers
include:
• Employer-paid health/medical, life, disability, or dental insurance
premiums
• Employer-paid child day care for children of employees
• Retirement contributions
• Worker’s compensation costs
Note: Report the expended amounts paid by the LEA which are
directly associated with each staff member by type of employee benefit
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Reporting Allowable Transportation Service Costs
1 & 2. Transportation Payroll Costs
Salary and Benefit costs for eligible specialized transportation service
providers
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Only those salary and benefit costs for eligible specialized transportation
service providers are eligible for SBAP cost reimbursement
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Eligible specialized transportation service providers include Bus Drivers, Bus
Attendants, Mechanics, Substitute Drivers
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LEAs are required to report gross expenditures and then properly
reduce expenditures for funds paid from federal funding sources
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Costs can be reported as specialized transportation only or not
specialized transportation only (details on later slide)
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Reporting Allowable Transportation Service Costs
3. Approved Specialized Transportation Non Personnel costs
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CMS has approved a list of specialized transportation non personnel costs,
including:
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Lease or Rental Costs
Insurance Costs
Maintenance and Repair Costs
Fuel and Oil Costs
Purchases under $5,000
Contract Costs – for transportation services and transportation equipment
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Only those items included within the above categories can be reported on
the Medicaid cost report
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Costs can be reported as either specialized transportation only or not specialized
transportation only (details on later slide)
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Reporting Allowable Transportation Service Costs
4. Transportation Equipment Depreciation Costs
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Depreciation for specialized transportation assets follows a similar
process as that for the depreciation of direct medical service materials
and supplies
•
If a single specialized transportation non personnel item cost exceeds
$5,000, then the item should be depreciated
•
Costs can be reported as specialized transportation only or not
specialized transportation only (details on later slide)
58
Reporting Allowable Transportation Service Costs
5. Unrestricted Indirect Costs
•
CMS recognizes that LEAs incur indirect costs for direct service program
administration.
•
•
Unrestricted indirect costs represent the expenses of doing business that are not
readily identified within a particular grant, contract, program, but are necessary
for the general operation of the organization to conduct the activities it performs.
The Pennsylvania Department of Education (PDE) is the cognizant agency
responsible for calculating and approving LEA indirect cost rates on behalf
of the United States Department of Education (US DOE).
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Reporting Allowable Transportation Service Costs
6. Specialized Transportation Ratio
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What is the Specialized Transportation Ratio?
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The Specialized Transportation Ratio is used when an LEA can not discretely break
out its specialized transportation costs from its general transportation costs
Specialized
Transportation
Ratio
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Total Number of IEP Students Receiving Specialized
Transportation Services
=
Total Number of ALL Students Receiving Transportation
Services (Specialized or Non Specialized)
The ratio is calculated and reported annually on the Medicaid SBAP Cost Report
The ratio is applied to those costs identified as “not specialized transportation only”
60
Reporting Allowable Transportation Service Costs
7. One Way Trip Ratio
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What is the One Way Trip (OWT) Ratio?
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OWT
Ratio
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The ratio is calculated and reported annually on the Medicaid SBAP Cost
Report
• A Medicaid one-way trip is a trip in which a Medicaid enrolled student
who has specialized transportation services in their IEP and received
another SBAP service provided by the LEA on the day of the trip. The
numerator will be completed by PCG based on paid claims data
Total Number of Medicaid One Way Trips
=
Total Number of ALL One Way Trips
The purpose of the One Way Trip ratio is to allocate specialized
transportation costs to the Medicaid Program
• In other words, it is used to determine Medicaid’s portion of specialized
transportation costs incurred by LEAs for the provision of SBAP
specialized transportation services
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Now that we know about the SBAP Medicaid Cost Report process for
Specialized Transportation, how do the pieces fit together?
Calculation
Step
Cost Report Element Description
Value
Cost Report
Element #
A
Salary Costs of SBAP Specialized
Transportation Service Providers (net
of federal funds)
$225,000
1
B
Benefit Costs of SBAP Direct
Specialized Transportation Providers
(net of federal funds)
$65,000
2
C
Specialized Transportation Non
Personnel Cost (net of federal funds)
$45,000
3
D
Special Transportation Non Personnel
Depreciation Cost (net of federal funds)
$14,000
4
E
Total Specialized Transportation
Service Costs
(net of federal funds)
(Sum of Steps A through D)
$349,000
62
Calculation
Step
Cost Report Element Description
Cost Report
Element #
Value
E
Total Specialized Transportation Service
Costs
(net of federal funds)
(Sum of Steps A through D)
$349,000
F
Indirect Cost Rate
G
Step E times Step F
H
Specialized Transportation Ratio
I
Step G times Step H
J
One Way Trip Ratio
48.00%
K
SBAP Medicaid Eligible Specialized
Transportation Cost
(Step I times Step J)
$61,647
1.15
See Previous
Slide
5
$401,350
32.00%
6
$128,432
7
63
Now that we know how the SBAP Medicaid Direct Medical Service and
Specialized Transportation Costs are calculated, how is the settlement
determined?
Calculation
Step
Cost Report Element Description
Value
A
SBAP Medicaid Eligible Direct Service and
Specialized Transportation Cost
$496,774
B
SBAP Medicaid Interim Payments Received
$395,745
Cost Report
Element #
See Step N for Direct
Service and Step K for
Specialized
Transportation
(Received through traditional billing process)
C
Medicaid Cost Settlement Gross Amount
$101,029
64
Now that we know how the SBAP Medicaid Direct Medical Service and
Specialized Transportation Costs are calculated, how is the settlement
determined?
Calculation
Step
Cost Report Element Description
Value
C
Medicaid Cost Settlement Gross Amount
D
July – September (x 0.25)
$25,257
July – September Federal Share
$13,909
October – June (x 0.75)
$75,772
October – June Federal Share
$41,129
E
FMAP Rate(%)
$101,029
55.07%
54.28%
Federal Share at FY 2013
F
(Federal Share based on FFP Rates published by the
US Department of Health and Human Services)
$55,038
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Cost Settlement Calculation
66
Cost Settlement Calculation
Cost Settlement Summary
•
•
In order to optimize reimbursement during cost settlement, it is important
for LEAs to carefully examine all direct medical services and transportation
costs reported so that all allowable costs are included in the SBAP Annual
Medicaid Cost Report.
Most common unreported costs include:
•
•
Direct medical service provider salaries (due to appropriate staff not being
included in the quarterly RMTS staff pool list).
Transportation: payroll, purchased professional services, other costs, and
depreciation.
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Cost Settlement Calculation
Cost Settlement Summary
•
LEAs must continue to bill for direct services throughout the year and are
required to do the following to meet program compliance requirements:
• Qualified providers must deliver services to students
• LEAs must maintain all required documentation
•
LEAs will receive interim payments on approved claims.
•
•
•
Claiming will remain a critical component in the direct service reimbursement
process.
LEAs should submit direct service claims for staff participants included in the
quarterly time study.
Any staff who are 100% federally funded should not be included in the time
study and should not bill for services.
68
Cost Settlement Calculation
Cost Settlement Summary
•
DPW will restrict the cost settlement process to settle only direct
service categories where LEAs billed and received payment.
•
For example: Physical Therapists are included on the staff roster, but the LEA did
not submit any Physical Therapy claims. Therefore, Physical Therapy costs will
not be included on the annual cost report.
•
Claiming activity will be monitored throughout the year and compared to
thresholds established based on prior year’s activity.
69
Cost Settlement Calculation
Cost Settlement Summary
•
LEA specific cost settlement will take the LEA’s Medicaid Allowable Costs,
as calculated by the SBAP Annual Medicaid Cost Report and compare
them to Medicaid reimbursement (interim payments) received.
•
If the LEA’s costs exceed reimbursement received, the LEA will receive a
settlement. If payment is due to the LEA, the LEA will receive a payment for the
amount due.
•
If the LEA’s costs are less than reimbursement received, the LEA will pay back
the difference. If payment is owed to DPW, the LEA will be required to refund
the amount due.
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Cost Settlement Example
1. If the LEA’s Medicaid costs exceed reimbursement received, the LEA
will receive a settlement.
Cost Settlement
Test LEA1
Medicaid Cost for Direct Medical Services and Transportation
$510,000
Federal Share (see slide 64 for details)
55.07% &
54.28%
(Federal Share based on blended FMAP Rates published by the US Department
of Health and Human Services)
Federal Share Amount
$277,835
Medicaid Interim Payments Received for Direct Medical and
Transportation Services
$255,000
Payment Due to LEA (Federal Share Only)
$22,835
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Cost Settlement Example
2. If the LEA’s Medicaid costs are less than reimbursement received, the
LEA will pay back the difference to CMS.
Cost Settlement
Test LEA2
Medicaid Cost for Direct Medical Services and Transportation
$450,000
Federal Share (see slide 64 for details)
55.07% &
54.28%
(Federal Share based on blended FMAP Rates published by the US Department
of Health and Human Services)
Federal Share Amount
$245,149
Medicaid Interim Payments Received for Direct Medical and
Transportation Services
$255,000
Payment Due from LEA (Federal Share Only)
($9,851)
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Desk Review Overview
73
Desk Review Overview
Desk Review Purpose
•
•
Upon LEA certification of the SBAP Medicaid Cost Report PCG begins the
Desk Review process.
The Desk Review closely examines each LEA’s reporting information,
including the:
• Annual Payroll Information;
• Direct Medical Materials and Supplies;
• Direct Medical Equipment Depreciation; and,
• Individualized Education Program (IEP) Ratio.
74
Desk Review Overview
Desk Review Purpose (Continued)
•
•
•
LEAs reported costs and ratios are compared against state-wide
thresholds. Outlier costs are identified and reviewed to ensure
compliance.
LEAs are responsible for reviewing the identified information and either:
• Confirm the reported information is accurate; or,
• Make any necessary adjustments.
In some cases, a further follow up explanation could be requested if the
LEA made any additional adjustments in response to the desk review
process
75
Desk Review Overview
Desk Review Process
•
•
•
PCG will send each LEA a Desk Review email via
[email protected].
Then, LEAs will need to respond and either confirm the information is
accurate or request to make an adjustment to allow for corrections.
Once the LEA’s Desk Review response is received via email, PCG will
respond and either:
• Request further explanation if there are still outstanding questions;
• Open the applicable report(s) if an adjustment has been requested; or,
• Close out the desk review if all items are resolved.
76
Desk Review Overview
Desk Review Process
If an LEA determines that an error was made and an adjustment is
requested:
• PCG will notify the LEA that the report has been reopened for
adjustments
• If an adjustment is made to a report please ensure the report is recertified.
• Notify PCG once this is complete at [email protected] to
expedite the process.
• PCG will then conduct a secondary review of the revised information.
77
Desk Review Overview
Types of Desk Review Edits
• Annual Edit Explanations: Reviewing the LEA’s explanations for each
Annual Edit provided in the MCRCS to ensure reasonability.
• Annual Payroll: Ensuring costs were reported according to an accrual
accounting method for the quarters in which the individuals were active on
the staff pool list.
• Other Costs: Comparing, by service type, the total amount of Other Costs
report (Materials, Supplies and Equipment Depreciation) against the total
amount in Annual Payroll for that service type.
• Equipment Depreciation: Ensuring the reasonability of the reported Direct
Medical Equipment Depreciation, including, the Purchase Price and Years of
Useful Life.
78
Desk Review Overview
Desk Review Reminders
•
•
•
An LEA’s Desk Review must be completed in order for the fiscal year cost
settlement result to be calculated.
Respond by the due date stated in the email. All follow up
correspondence must be responded to in a timely fashion.
PCG Help Desk is available via phone and email for any questions or
needed help regarding the desk review process.
79
Timeline of Events
80
Timeline of Events
•
The timeline outlined for FY13 cost settlement is a unique timeline given the
ongoing implementation of the CPE reimbursement methodology.
•
•
•
•
The Medicaid cost report will cover the state fiscal year (July 1 through June 30).
Future timelines will require annual cost report submissions by December 31 with
cost settlements process by June 30.
LEAs should be cognizant of events surrounding provision of materials, trainings,
cost reporting, and cost settlement, and adhere to DPW and CMS mandated
deadlines and requirements.
The following timeline provides estimates for the completion of key tasks in
the cost settlement process.
•
More detailed dates for the key tasks will be provided when they are available.
81
Timeline of Events
Key Tasks
Date
Timeline for
Completion
MCRCS Open to LEAs
March 3, 2014
LEAs complete annual cost reports
April 18, 2014
7 weeks
Desk reviews completed, including
any cost report revisions and recertifications
June 6, 2014
7 weeks
Cost settlements calculated
June 13, 2014
1 week
LEAs return signed CPE
Certification forms
June 25, 2014
1.5 weeks
82
Contacts
•
Help Desk Toll-free Number: 1-866-912-2976
•
Cost Reporting Questions: [email protected]
83
Questions?
84