November Recap of DHLF Activities

Following is a summary of the issues the DHLF has been focusing on since our last monthly recap. As outlined below, most activities have been (and will continue to be) focused on the 2012-13 state budget which changed Medi-Cal inpatient fee-for-service reimbursement for District and Municipal hospitals, effective July 1, 2012.

Activities Related to District Hospitals’ Transition to CPEs/Obtaining New Federal Waiver Funding

Current and Ongoing Activities
The Department of Health Care Services (DHCS) is (still) awaiting approval (from the Centers for Medicare and Medicaid Services – CMS) on all components of the 2012-13 state budget proposal to transition non-designated public hospitals (NDPHs) to using certified public expenditures (CPE) for Medi-Cal fee-for-service inpatient services coupled with receiving waiver funding (for uncompensated care costs and delivery system improvements). The CMS approvals are pending the review of proposed NDPH Waiver Amendment documents and additionally, proposals specific to Attachment Q (related to the Delivery System Reform Incentive Program). Some documents were submitted to CMS in June and to date there has been back-and-forth questions and answers between the two entities.

Delivery System Reform Incentive Payments (DSRIP)
DHLF staff and hospital representatives are meeting weekly with DHCS on this subject. Currently, DHCS is in the process of reviewing each individual hospital plan for categories 1 & 2. In their review, they are checking for correct formatting, proper grammatical editing, coherency, plan completeness and overall plan ambition. To date, 32 hospital plans and 3 extension requests have been submitted to DHCS. If your plan has not yet been submitted, please contact DHLF staff as soon as possible.

All NDPHs will be required to submit a 3-year DSRIP plan for categories 1, 2 and 4 (category 1 – infrastructure; category 2 – innovation and redesign; category 4 – patient safety). Plans for categories 1 and 2 already should have been submitted (as noted above) and category 4 (two projects for this category) will be due to DHCS by January 4 (although due to the holidays, DHLF staff is advocating for an extension of this date by a week). DHCS is proposing that district/municipal hospitals NOT complete a project in category 3 as those facilities without rural health clinics likely would find it difficult to identify projects in this category (population-focused improvement).

Detailed information on DSRIP requirements has been provided to all NDPHs previously through ongoing emails, conference calls and these monthly updates.

If you or staff within your hospital are interested in participating in the DHLF DSRIP workgroup, please respond to this email expressing your interest.

Uncompensated Care
The DHLF will work with DHCS to convene a webinar(s) to discuss requirements related to reporting of CPEs both for Medi-Cal and the uninsured once DHCS has finalized reporting requirements.

Hospital Provider Fee

Installments of direct grants to all NDPHs contained in the 30-month hospital provider fee (the term of the fee is July 1, 2011 through December 31, 2013) are being distributed to hospitals on a periodic basis. Subsequent installments will continue (approximately 10 installments in total) over the term of the fee.

Hospital Charges

The California Hospital Association (CHA) has convened a group of CFOs and other interested parties (including DHLF and other hospital constituency group staff) to consider options to improve or replace the current hospital billing/charging system. This is driven by two primary goals, the first of which is to find a solution to proactively mitigate near-term and future efforts by others to mandate unreasonable and unsustainable pricing policies on hospitals. The second is to improve the public’s perception about hospital bills and pricing. Duane Dauner, president of CHA, met with members of the DHLF in November to outline the project and listen to members’ concerns.

DHLF staff has convened a workgroup of district/municipal hospital CFOs to provide input to CHA’s workgroup to ensure NDPHs are not disadvantaged by proposals that result from CHA’s work in this area. Updates of both the CHA and DHLF workgroups on this subject will be provided as information becomes available. The CHA Board will consider this issue and next steps at its December 20 meeting.

California Health Benefit Exchange

The California Health Benefit Exchange (now known as Covered California) plans to enroll about 2 million new people in Medi-Cal, and help an additional 2 million Californians buy private coverage with federal subsidies.

In January 2013, bids from health issuers proposing to sell Qualified Health Plans through Covered California will be due so currently health insurers are beginning efforts to assemble networks of medical providers, negotiate rates and design various health plans to comply with benefits in the exchange. This is being done prior to Covered California’s negotiations with the more than 30 health insurers (which have provided an intent to bid) on coverage and pricing in 19 separate regions of the state. Policies through Covered California take effect in January 2014, when most Americans face the requirement to buy health insurance or pay a penalty. We will keep you apprised of Covered California’s activities in future updates. Exchange activities will be the subject of several pieces of legislation in 2013.

Upcoming DHLF Board Events:

  • February 27 – DHLF Legislative Day, Sacramento
  • March 12 – DHLF Board Meeting, Sacramento

(Additional 2013 Board meeting dates as well as our annual education session will be determined and provided to you soon.)

DHLF Staff Activities

In addition to several ongoing informal meetings, DHLF staff has recently or is planning to attend:

California Association of Public Hospitals Annual Meeting, December 5-7
CHA Hospital Charges Workgroup (with member hospitals), December 12
Covered California Board Meeting, December 18
CHA Board Meeting, December 20
DHCS DSRIP Workgroup (with member hospitals), weekly

Please let us know if you’d like additional information or have input on any of these.

We want to take this opportunity to wish you all a healthy and happy holiday season. We have enjoyed working with you in this challenging year and look forward to facing new and continuing challenges together in 2013!