Update on Supplemental Funds / My Medical Leave

At both the CFO and Board meetings last week, we went over the various supplemental funding programs, which I’m summarizing below (including some new information which has come up since last week’s meetings):

AB 113 – The traditional 17-18 program checks were sent to hospitals the end of June.  Most reported receiving them by June 28 (checks were dated June 22).  Unfortunately they were labeled “non DSH” which might have created some confusion.  There should be an additional amount both for the traditional and for the expansion population for 16-17, but there is no additional funding for 15-16 for this program.  There also should be additional funding for the optional population for 17-18.  (Expansion funding for 13-14 and 14-15 for this program also was distributed in June)

AB 915 – DHCS was delayed in processing the AB 915 SFY 16/17 traditional and ACA claims. They are currently processing those claims now and hope to complete those no later than early September 2018.  SFY 17/18 claims will be submitted by providers early in CY 2019.

A question came up at the CFO meeting regarding hospitals that did not submit separate traditional/expansion claims for 13/14 and/or 14/15 and were therefore overpaid (receiving both the 50 percent match on the original claim and the 100 percent match on the follow-up expansion claim the state prepared).  DHLF staff is checking with DHCS on this issue so if you also believe you may have been overpaid, please respond to Erin Clark (eclark@scainc.net).

HQAF 4 – This program is complete, but as DHCS does a final reconciliation there is a small amount of funding available to the rural districts for direct grants.  Those final checks should arrive in about five weeks.

HQAF 5 – The direct grant payments are underway and cycle 5 and 6 payments should reach you this month or early next.  This will put DHCS back on schedule so cycle 7 should occur in October and then subsequent payments should be quarterly thereafter.  I’ve attached the schedule for cycles 5 through 8, but the actual amounts will be a little less (reduced by approximately 10 percent) based on collections of the fee from the private hospitals.  As a reminder, these payments are directed to CAH, rural and Medi-Cal DSH eligible hospitals.  All district/municipal hospitals will receive funding from this program and those that do not receive direct grants will get a greater amount from the IGT-generated funds via Medi-Cal managed care.

The IGT-generated funds for HQAF 5 via managed care currently is in the approval process at CMS.  We will keep you apprised but unfortunately these approvals are quite slow.

Directed payments – Possibly in 2019-20, districts/municipal public hospitals will begin the transition in the HQAF to directed payments (currently our funding is considered pass-through payments and CMS is transitioning away from pass-through payments).  Private hospitals will begin the transition in 17-18, so staff will work with the CFOs and other hospital staff to begin the review of the data and discuss distribution probably later this year.  Fortunately, we will be able to use lessons learned from the private hospitals.  Directed payments mean (although CMS could revise this) that an amount of the funding available via IGT-generated funding in HQAF 5 will be based on services provided based on encounter data submitted by the hospitals to the plans to DHCS.  The amount of funding will be divided by the number of contracted inpatient days and contracted outpatient services and then each eligible hospital will receive that amount of funding,  More details to follow on this but the first order of business is to begin to work with the health plans on ensuring encounter data is as accurate as possible.

Rate range – A component of the 17-18 rate range is funding for the ACA expansion population.  This population is paid at a higher federal match than the traditional population (50-50).  The optional population federal match is 95 percent for July through December 2017 and 94 percent for January through June 18.  This means that you will receive greater than the usual 50-50 match on this program  However, it is important to stay in touch with your health plans as DHCS no longer can direct the plans as they have in the past.  The various populations covered by this program is outlined in your contract from DHCS.

Medi-Cal DSH audits – DHCS has contracted with Myers and Stauffer to audit the Medi-Cal DSH program (based on direction by CMS).  Some district/municipal hospitals are hitting their cost-based limit associated with the DSH program, so we want to remind you that some of your supplemental payments (specifically rate range) can be diverted away from hospital revenue IF you use some of the funding to subsidize physicians for their care of Medi-Cal managed care beneficiaries.

PRIME – DY 13 year end reports are due September 30.  Once the report is accepted, DHCS will request your IGT.  It then is generally two to six weeks until you receive the federal match.

Finally, a personal note.  I will be on medical leave beginning July 25 without access to calls or emails.  I’m anticipating a very limited return around August 15 and a full return sometime in September.  In the meantime, please contact Erin Hagstrom Clark at eclark@scainc.net or 916-317-4835 (cell) or 916-673-2020 (office).  And of course, Steve Clark, and advocates Kathryn Scott, Meghan Loper and Charity Bracy (also handling PRIME) also will be available.

17-18 direct grant revised July 2018 to DHCS