NCIL Action Alert: New CMS Regulations Hurt Centers for Independent Living and Threaten Money Follows the Person Nationwide

February 8, 2008

Many of you have been reading lately about CMS and Targeted Case Management (TCM). Yesterday the NCIL PAS Committee hosted Mr. Minh Ta, Rep. Keith Ellison’s (D-MN) Legislative Director. Representative Ellison has introduced a temporary fix to TCM (H.R. 5173) and Sen. Norm Coleman (D-MN) has introduced a companion Senate bill (S. 2578).  This legislation would delay application of proposed changes to Medicaid payment rules for case management and targeted case management services.

The Centers for Medicare and Medicaid Services (CMS) awarded Money Follows the Person (MFP) demonstration grants to 31 states in 2007.  MFP supports individuals in institutions to move to the community, and Targeted Case Management is a critical tool CILs and other organizations use to implement Money Follows the Person locally. Now CMS is using the DRA of 2005 to justify cutting Targeted Case Management.  Advocates know this new regulation will only make it more difficult to transition people out of nursing homes! For a summary on the effect of Targeted Case Management regarding Money Follows the Person, see the summary below.

It is critical to call your elected members of Congress, your Governor, and State Medicaid Directors. CMS intends to implement the rule regardless of how many letters we send them directly, so we must now target members of Congress to urge a legislative fix. CMS has gone over-and-above the intent of Deficit Reduction Act cuts and they are using the Targeted Case Management rule change to do policy-making under the radar.  We must stop them in their tracks! Please call, fax, email, or write your Congressional Representatives and state elected officials asking them to help stop the out-of-control devastation to individuals and families being attempted by the current Administration by supporting H.R. 5173 & S. 2578!

For further information, please contact Judy Roy at bhamilc1@bellsouth.net or Elizabeth Leef, NCIL Policy Analyst at elizabeth@ncil.org or 202-207-0334 ext 1015.

Money Follows the Person Demonstration: Targeted Case Management Services – Impact of the DRA Interim Regulations

Prepared by Robert Mollica
National Academy for State Health Policy
Revised 1/11/2008

Background

The Centers for Medicare and Medicaid Services awarded Money Follows the Person (MFP) demonstration grants to 31 states in 2007. Supporting individuals in institutions to move to the community is a critical component of MFP programs. Transition coordination, relocation coordination, supports coordination and case management are terms often used to describe this complex activity. Several states have elected to provide targeted case management services and other are considering this option for transition coordination activities under MFP. Other states plan to cover case management as an administrative activity.

The Deficit Reduction Act of 2005 (DRA) revised the scope and activities that can be covered under case management.  Interim Final Regulations (IFR) implementing the new provisions were published in the Federal Register on Tuesday, December 6, 2007 (pages 68077-68093). The comment period ends February 4, 2008 and the regulations will be effective March 3, 2008. The IFR contains several key changes that:

• Describe specific components and requirements for case management;
  
  
• Limit the pre-transition period during which case management may be provided for individuals relocating from an institution;
  
  
• Requires that case management be provided by community case management providers for individuals who transition;
  
  
• Limit payment to a single case manager; and
  
  
• Exclude activities included in the definition of case management from activities that may be claimed as an activity necessary for the proper and efficient administration of the Medicaid state plan.

Potential impact

The regulations may have a significant impact on states with single entry point systems or in 1915 (c) waiver programs in which case managers complete an assessment, determine functional eligibility for waiver services, prepare a care plan, authorize waiver services, monitor the care plan and complete reassessments.

As a state plan or targeted case management service:

• Case managers are responsible for developing a care plan but they cannot authorize services in the plan.
  
  
• Case managers do not seem to have the authority to determine functional eligibility.
  
  
• Transition case management may be ineffective helping consumers relocate from institutions if the transition cannot be completed within 60 days.
  
  
• States with single entry point system and states that use case managers to perform all case management functions for 1915 (c) waivers may have to unbundle the process for accessing services by allowing community case management agencies to complete the assessment and care plan and designate state staff to determine eligibility, approve the care plan and authorize services.
  
  
• States that cover case management as an administrative activity may not allow them to:
  
  
• Conduct a comprehensive assessment;
  
  
• Implement a complete care plan;
  
  
• Allow state staff to conduct tasks included as case management activities;
  
  
• Limit providers to state agency staff.

Case management and targeted case management provisions

Definition and general requirements

• Case management and targeted case management is defined as “services which will assist individuals, eligible under the plan, in gaining access to needed medical, social, educational and other services.” Case management may be furnished to nursing home residents who are preparing to move to the community.

• Case management for beneficiaries who transition from an institution to the community can only be provided by and reimbursed to a community case management provider.

• Medicaid recipients must be given a choice of case management providers who meet the state’s qualifications. However, with regard to target groups that consist entirely of persons with developmental disabilities, or individuals with chronic mental illness, the state may limit the providers of case management to ensure that case managers are capable of ensuring that needed services are actually delivered to these vulnerable populations.

• Comment – “Community” is not defined. It is not clear if the intent is to exclude payments to staff in institution who may perform discharge planning and these activities is therefore limited to community based organizations. If the intent is to exclude payments to institutional staff, are staff from state agency field offices considered “community case management providers?”
  
  States that contract with counties, Area Agencies on Aging or other entities to serve HCBS waiver participants may have to unbundle activities which will fragment access to services.
  
  

Time period for case management for individuals who transition from an institution

The new regulations establish limits on the period for which case management costs may be claimed based on the length of stay:

• Case management costs may be claimed for the last 60 consecutive days (or a shorter period specified by the state) of a covered, long term, institutional stay of 180 days or longer.

• Case management costs may be claimed for the last 14 days of a covered institutional stay of less than 180 consecutive days.
  
  
  • Comment – Prior to the new regulations, case management services could be furnished during the last 180 consecutive days of a Medicaid eligible person's institutional stay. States could specify a shorter time period or other conditions under which targeted case management services may be provided. This limitation does not recognize that housing is a major barrier to transitioning individuals to community settings which often requires much longer than 60 days to arrange.
    
    
  • Prior to the regulations, costs for transition case management for individuals who did not move to the community could be covered as an administrative cost. This option is no longer available and it appears that the costs for these activities cannot be reimbursed by Medicaid.

Claiming and billing

• The regulations do not allow states to include case management in a bundled rate. CMS states that a unit rate of 15 minutes or less is the most efficient and economical basis for establishing a rate.

• The new rules set conditions for reimbursement. Federal reimbursement cannot be paid until:

• The individual leaves the institution; and
• Is enrolled in community services.

• Comment – The explanation section of the regulations adds a third condition that requires that the person is receiving medically necessary services in a community setting. This condition is not stated in the regulation and would not be required.
  
  

Case management tasks

Role of the case manager

• Case management activities must be provided by a single case management provider.

• Case management activities include completing a comprehensive assessment; developing a care plan; referral and related activities; and monitoring and follow up.

• The case manager is responsible for a unified care planning process “to ensure accountability and coordination in assisting individuals in gaining access to service to address all component of assessed need. Fragmenting the service would reduce the quality of case management; the point of case management is to address the complexities of coordinated service delivery for individuals with medical needs.”

• The explanation section states that comprehensive assessment is required to minimize the need for coverage under multiple case management plans and multiple case managers to reduce duplication and inefficiencies.
  
  
  • Comment – The case manager seems to have limited authority to approve or authorize services included in the care plan. The rule also appears to prohibit case managers from authorizing other services under the plan. The Medicaid agency cannot delegate decisions about the “medical necessity” of other services. It is not clear if this provision applies only to State plan services or all Medicaid services, and if the later, it could prevent MFP case managers from authorizing transition services or home and community based waiver services. Case managers are responsible for developing a care plan based on a comprehensive assessment but it appears the care plan will have to be authorized by others.
    

Comprehensive Assessment

• Case managers must complete an assessment and periodic reassessment of an eligible individual to determine service needs by taking a client history, identifying an individual’s needs, strengths and preferences and completing related documentation, and if needed, gathering information from other sources.

• The assessment must be comprehensive and address all needs of the individual.

• Because the assessment is comprehensive, it is intended to minimize the need for individuals to receive multiple assessments from multiple case managers and programs and likely reduce service duplication and inefficiencies.

• Comment – The regulations may conflict with other sections of the regulations that do not allow case managers to act as a “gatekeeper” or authorize Medicaid services. Therefore, when individuals are referred to Medicaid programs or service providers, they may be required to complete a separate assessment, determine level of care or medical necessity, develop a care plan and issue a service authorization. Further, the comprehensive assessment instrument may not be compatible with the instrument used to carry out program specific activities.

Care plan

• Development and periodic revision of a specific care plan based on the information collected through a one-to-one assessment.

• The assessment specifies the goals and actions to address the individual’s medical, social, educational, and other service needs.
  
  
  • Comment - Depending on the content of the care plan, the case manager may not be able to control implementation of the care plan if they cannot approve or authorize services. The care plan might describe general activities such as refer for personal care services but the specific number of  hours of service and the tasks that may be needed could be beyond the influence of the case manager.
    
    
    

Referral and related activities

• Case management activities include referral and related activities (scheduling appointments but not including transportation, escort or child care) to help an individual obtain needed services. 
  
  
  

Monitoring and follow up

• The regulations also require monitoring and follow-up activities including activities and contacts to ensure the care plan is effectively implemented and adequately addresses the individual’s needs.

• Monitoring activities determine whether services are furnished in accordance with the plan of care, whether services in the care plan are adequate, and whether changes are made in the plan of care as necessary.

• The frequency of monitoring is specified by the state but must be done at least annually.

• Comment – If an individual is “enrolled in community services” and receives 1915 (c) waiver services that provide case management to participants, the SPA might specify that the monitoring activity will terminate when, or within a specified period after, the individual begins receiving community services.

If the case manager has no authority to authorize services, it will be difficult to ensure that the care plan is carried out.     

Other requirements

• Individuals must have a free choice of providers.

• Case management cannot restrict access to other Medicaid services.

• Individuals cannot be required to accept case management as a condition for receiving Medicaid services.

• Case management activities cannot also be an integral component of another covered Medicaid services.

• The State Plan Amendment must include an assurance that case management activities are coordinated with and do not duplicate discharge planning tasks performed by institutional staff. The public notice acknowledges that case management activities for individuals who transition after a lengthy stay in an institution are beyond the scope of work for discharge planners.

• Case management cannot constitute the delivery of underlying medical, educational, social or other services to which an individual has been referred.

• Case managers may not authorize or deny other services under the state plan (nursing facility, personal care). Case managers may not function as a “gatekeeper” because it conflicts with the case manager’s role to help individuals “gain access” to needed services.

• Comment – It is not clear whether the “gatekeeping” restrictions apply only to Medicaid state plan services or also 1915 (c) waiver services and, if the latter, it could prevent a case manager/transition coordinator from authorizing transition services. In states that contract with Counties, Area Agencies on Aging, or other non-government entities, could the same person function as a provider of targeted case management and shift to a provider of waiver case management when the individual leaves the institution and begins receiving waiver services?
  
  
• The State Plan Amendment must describe the qualifications of case management providers and the rate methodology for reimbursing providers.
  
  

Target groups for targeted case management

• States must identify one or more target groups to receive services such as nursing home residents planning to move to the community.

• Separate state plan amendments must be submitted for each group that will receive TCM services.

• States may include limitations in comparability (TCM will not available in the same amount, scope and duration to all eligible recipients) and statewideness (TCM maybe limited to specific geographic areas of a state).
  
  

Case records

• Case records must be maintained that include the name of the individual; the dates of service; the name of the provider agency chosen by the individual; the nature, content and units of case management; whether the goals specified in the care plan were achieved; timelines for providing services and reassessment; the need for, or occurrence of, coordination with case managers of other programs.
  

Case management as an administrative activity

• The Interim Final Regulations limit a state’s ability to claim reimbursement for case management tasks as an administrative activity. Some activities are allowed “as a function necessary for the proper and efficient operation of the Medicaid State plan.” That provision has been qualified. Section 441.18(c)(5) of new regulations states that:

Activities that meet the definition of case management services …. cannot be claimed as administrative activities.

• Comment – The regulation distinguishes between case management activities as a state plan service and tasks that may also be considered case management that are necessary for the proper and efficient administration of the state plan and may therefore be covered as an administrative expense. Some states combine functions in both areas in a comprehensive case management program. It is not clear whether a case manager could function in two roles with activities claimed as a case management service and others as an administrative activity cost which would require allocating costs between the two types of coverage.

Case managers in some states perform some tasks (level of care, preadmission assessment, and prior authorization (of waiver services) that look like they can be covered as an administrative expense and others that are covered by the definition of case management. Could a state could set a rate for case management as a service and carve out the administrative portions? Would it be practical to do so?

 Unbundling tasks and assigning them to different organizations may require that some states to fragment access to home and community based services.

Assisting a beneficiary to access affordable housing is considered a case management activity which cannot be claimed as an administrative expense. However, accessing housing should be considered necessary for the efficient administration of the state plan if it means a person who can live in the community continues to live in a nursing facility without it. Efficient operation of the state plan should be considered to be met by allowing beneficiaries to access home and community based services in the most streamlined manner possible.

 The explanation of the regulations states that eligible administrative activities “are performed by state agency staff.” Some states provide case management through contracts with other state agencies or non-state entities to waiver service participants as an administrative activity. This clarification may affect state’s ability to continue this arrangement. Will a state be able to delegate tasks that implement, but do not change, Medicaid policy through interagency agreements or contracts with local organizations?

CMS should use the statement that the activities listed in the regulation are not all inclusive and allow states that define case management more broadly (assessment, functional eligibility, plan of care, service authorization, monitoring, follow up and reassessment) to continue to do so.

Comparing case management and eligible administrative activities

Case management

• Case management services means services furnished to assist individuals, eligible under the State plan who reside in a community setting or are transitioning to a community setting, in gaining access to needed medical, social, educational, and other services.
  
  
• Access to other services includes transportation and housing which may not be part of the state plan.

Administrative activities

• Activities performed by State agency staff and may involve facilitating access to and coordinating Medicaid program services:
  
  
• Medicaid eligibility determinations and re-determinations;
  
  
• Medicaid intake processing;
  
  
• Medicaid preadmission screening for inpatient care;
  
  
• Prior authorization for Medicaid services;
  
  
• Utilization review; and
  
  
• Medicaid outreach.
  
  
• These examples are not meant to be all-inclusive.  CMS may make determinations regarding whether these or other activities are necessary for the proper and efficient administration of the State plan.
  
  
• Administrative activities are performed by State agency staff.
  
  
• Administrative activities must be related to the state plan.