E8-30820. Notice of Hearing: Reconsideration of Disapproval of Montana State Plan Amendment (SPA) 08-003

AGENCY:

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

ACTION:

Notice of hearing.

SUMMARY:

This notice announces an administrative hearing to be held on January 27, 2009, at the CMS Denver Regional Office, 1600 Broadway, Suite 700, Denver, Colorado 80202 to reconsider CMS' decision to disapprove Montana SPA 08-003.

Closing Date: Requests to participate in the hearing as a party must be received by the presiding officer by January 13, 2009.

FOR FURTHER INFORMATION CONTACT:

Benjamin Cohen, Presiding Officer, CMS, 2520 Lord Baltimore Drive, Suite L, Baltimore, Maryland 21244, Telephone: [phone].

SUPPLEMENTARY INFORMATION:

This notice announces an administrative hearing to reconsider CMS' decision to disapprove Montana SPA 08-003 which was submitted on December 27, 2007, and disapproved on September 23, 2008. The SPA proposed to modify the reimbursement methodology for licensed denturist services and dental services effective October 1, 2007.

Section 1902(a)(30)(A) of the Social Security Act (the Act) requires that States have methods and procedures to ensure payments are consistent with economy, efficiency, and quality of care. The overall requirement in section 1902(a) of the Act for a State plan, and the specific requirement at section 1902(a)(30)(A) of the Act for methods and procedures related to payment, are implemented by Federal regulations at 42 CFR 430.10 and 42 CFR 447.252(b), which require that the State plan include a comprehensive description of the methods and standards used to set payment rates, and provide a basis for Federal financial participation (FFP). To be comprehensive, payment methodologies should be understandable, clear, and unambiguous. In addition, since the plan is the basis for FFP, it is important that the plan language provide an auditable basis for determining if payment was appropriate.

Montana SPA 08-003 proposed to reimburse denturist and dental services on a fee-for-service basis by multiplying a nationally recognized relative value unit for each service by a State specific conversion factor. CMS requested the State to include the exact conversion factor in the reimbursement methodology in order to meet the requirements of a comprehensive reimbursement methodology in accordance with Federal regulations at 42 CFR 430.10 and 447.252(b). Including the conversion rate would ensure that payment calculations were verifiable and auditable. Absent that detail, CMS requested that the State include sufficient information so that providers and CMS would know the initial rate for each service (either directly or through reference to a fee schedule) and have notice of any subsequent changes to each rate. The State declined to include such information in the SPA. Therefore, CMS was unable to approve the SPA because it does not comply with section 1902(a)(30)(A) of the Act as implemented by Federal regulations at 42 CFR 430.10 and 447.252(b).

Based on the above, and after consultation with the Secretary of the Department of Health and Human Services as required under Federal regulations at 42 CFR 430.15(c)(2), CMS disapproved Montana Medicaid SPA 08-003.

The hearing will involve the following issues:

• Whether Montana's proposed methodologies for payment of dental and denturist services, meet the requirements of section 1902(a)(30)(A) of the Social Security Act and Federal regulations at 42 CFR 430.10 and 42 CFR 447.252(b), which require that the State plan include a comprehensive description of the methods and standards used to set payment rates, and provide a basis for FFP, when the proposed plan did not specify the amount or methodology to determine a key variable that would determine the rate (a “conversion factor”); and
• Whether CMS incorrectly disapproved SPA 08-003 on September 23, 2008, by means of a hardcopy, date-stamped, signed letter from the CMS Acting Administrator, with a courtesy electronic copy of the signed letter e-mailed to Montana on September 24, 2008.

Section 1116 of the Act and Federal regulations at 42 CFR Part 430, establish Department procedures that provide an administrative hearing for reconsideration of a disapproval of a State plan or plan amendment. 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 Montana announcing an administrative hearing to reconsider the disapproval of its SPA reads as follows:

Ms. Mary E. Dalton,

Acting Medicaid Director,

Montana DPHHS,

Helena, MT 59604-4210.

Dear Ms. Dalton:

I am responding to your request for reconsideration of the decision to disapprove the Montana State plan amendment (SPA) 08-003, which was submitted on December 27, 2007, and disapproved on September 23, 2008. The SPA proposed to modify the reimbursement methodology for licensed denturist services and dental services effective October 1, 2007.

The issues to be considered at the hearing are:

• Whether Montana's proposed methodologies for payment of dental and denturist services, meet the requirements of section 1902(a)(30)(A) of the Social Security Act and Federal regulations at 42 CFR 430.10 and 42 CFR 447.252(b), which require that the State plan include a comprehensive description of the methods and standards used to set payment rates, and provide a basis for Federal financial participation, when the proposed plan did not specify the amount or methodology to determine a key variable that would determine the rate (a “conversion factor”); and
• Whether CMS incorrectly disapproved SPA 08-003 on September 23, 2008, by means of a hardcopy, date-stamped, signed letter from the CMS Acting Administrator, with a courtesy electronic copy of the signed letter e-mailed to Montana on September 24, 2008.

I am scheduling a hearing on your request for reconsideration to be held on January 27, 2009, at the CMS Denver Regional Office, 1600 Broadway, Suite 700, Denver, Colorado 80202, in order to reconsider the decision to disapprove SPA 08-003. 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 by Federal regulations at 42 CFR Part 430.

I am designating Mr. Benjamin Cohen as the presiding officer. If these arrangements present any problems, please contact the presiding officer at [phone]. 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.

Sincerely,

Kerry Weems,

Acting Administrator.

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: December 22, 2008.

Kerry Weems,

Acting Administrator, Centers for Medicare & Medicaid Services.