02-26904. Notice of Hearing: Reconsideration of Disapproval of Alaska State Plan Amendment 01-009

AGENCY:

Centers for Medicare & Medicaid Services (CMS), HHS.

ACTION:

Notice of hearing.

SUMMARY:

This notice announces an administrative hearing on October 24, 2002, at 10 a.m., Seattle Regional Office; 2201 Sixth Avenue; Room 1206; Seattle, Washington 98121, to reconsider our decision to disapprove Alaska State Plan Amendment (SPA) 01-009.

CLOSING DATE:

Requests to participate in the hearing as a party must be received by the presiding officer by November 7, 2002.

FOR FURTHER INFORMATION CONTACT:

Kathleen Scully-Hayes, Presiding Officer, Centers for Medicare & Medicaid Services, 2520 Lord Baltimore Drive, Suite L, Baltimore, Maryland 21244-2670, Telephone: [phone].

SUPPLEMENTARY INFORMATION:

This notice announces an administrative hearing to reconsider our decision to disapprove Alaska State Plan Amendment (SPA) 01-009. Alaska submitted SPA 01-009 on December 27, 2001.

The issue is whether the State's proposed rates are in compliance with the provisions of section 1902(a)(30)(A) of the Social Security Act (the Act), which requires that payments under the plan be “consistent with efficiency, economy and quality of care.”

The proposed SPA would increase the Medicaid payment rate for inpatient and outpatient services at facilities paid as Indian Health Service (IHS) facilities (including tribal facilities operated under contracts or compacts pursuant to Public Law 93-638). The IHS sets Medicaid billing rates for inpatient and outpatient services furnished by Alaska IHS facilities, which are announced in the Federal Register. Alaska's proposed rates would substantially exceed the IHS published rates, and Alaska provided no analysis of why it would be consistent with efficiency, economy, and quality of care to pay rates higher than the rate authorized by IHS. Absent any such analysis, the CMS found that the proposed rates were not consistent with efficiency, economy, and quality of care as required under section 1902(a)(30)(A) of the Act. Therefore, based on the reasoning set forth above, and after consultation with the Secretary as required under 42 CFR 430.15(c)(2), CMS disapproved Alaska SPA 01-009.

Section 1116 of the Act and 42 CFR, part 430, establish Department procedures that provide an administrative hearing for reconsideration of a disapproval of a state plan or plan amendment. The CMS is required to publish a copy of the notice to a state Medicaid agency that informs the agency of the time and place of the hearing and the issues to be considered. If we subsequently notify the agency of additional issues that will be considered at the hearing, we will also publish that notice.

Any individual or group that wants to participate in the hearing as a party must petition the presiding officer within 15 days after publication of this notice, in accordance with the requirements contained at 42 CFR 430.76(b)(2). Any interested person or organization that wants to participate as amicus curiae must petition the presiding officer before the hearing begins in accordance with the requirements contained at 42 CFR 430.76(c). If the hearing is later rescheduled, the presiding officer will notify all participants.

The notice to Alaska announcing an administrative hearing to reconsider the disapproval of its SPA reads as follows:

Mr. Robert Labbe,

Director, Division of Medical Assistance, Department of Health and Social Services, P.O. Box 110601, Juneau, AK 99811-0601.

Dear Mr. Labbe: I am responding to your request for reconsideration of the decision to disapprove Alaska State Plan Amendment (SPA) 01-009. Alaska submitted SPA 01-009 on December 27, 2001. This SPA would increase the Medicaid payment rate for inpatient and outpatient services at facilities paid as Indian Health Service (IHS) facilities (including tribal facilities operated under contracts or compacts pursuant to Public Law 93-638). The IHS sets Medicaid billing rates for inpatient and outpatient services furnished by Alaska IHS facilities, which are announced in the Federal Register. Alaska's proposed rates would substantially exceed the IHS published rates, and Alaska provided no analysis of why it would be consistent with efficiency, economy, and quality of care to pay rates higher than the rate authorized by IHS. Absent any such analysis, CMS found that the proposed rates were not consistent with efficiency, economy, and quality of care as required under section 1902(a)(30)(A) of the Act. Therefore, based on the reasoning set forth above, and after consultation with the Secretary as required under 42 CFR 430.15(c)(2), CMS disapproved Alaska SPA 01-009.

I am scheduling a hearing on your request for reconsideration to be held at 10:00 a.m., October 24, 2002, Seattle Regional Office; 2201 Sixth Avenue; Room 1206; Seattle, Washington 98121, to reconsider our decision to disapprove Alaska SPA 01-009.

If this date is not acceptable, we would be glad to set another date that is mutually agreeable to the parties. The hearing will be governed by the procedures prescribed at 42 CFR, part 430.

I am designating Ms. Kathleen Scully-Hayes as the presiding officer. If these arrangements present any problems, please contact the presiding officer. In order to facilitate any communication which may be necessary between the parties to the hearing, please notify the presiding officer to indicate acceptability of the hearing date that has been scheduled and provide names of the individuals who will represent the State at the hearing. The presiding officer may be reached at [phone].

   Sincerely,

Thomas A. Scully.

Authority: Section 1116 of the Social Security Act (42 U.S.C. 1316); 42 CFR 430.18)

(Catalog of Federal Domestic Assistance Program No. 13.714, Medicaid Assistance Program)

Dated: October 11, 2002.

Thomas A. Scully,

Administrator, Centers for Medicare & Medicaid Services.