HAR §17-1739-78. Requests for rate reconsideration

(a) Acute care providers shall have the right to request a rate reconsideration if one of the following conditions has occurred since the base year: (1) Extraordinary circumstances including but not limited to acts of God, changes in life and safety code requirements, changes in licensure law, rules or regulations, significant changes in case mix or the nature of service, or addition of new services occurring subsequent to the base year. Mere inflation of costs, absent extraordinary UNOFFICIAL 1739-29 circumstances, shall not be a ground for rate reconsideration; (2) Reduction in medicaid average length of stay within a facility which produced a decrease in the average cost per discharge but an increase in the average cost per day. This paragraph shall not include reductions in average length of stay resulting from a change in case mix. The rate reconsideration relief provided under this section shall be the lesser of actual growth in the cost per day since the base year or seventy-five per cent of the reduction in the average cost per discharge (inflated) since the base year divided by the current average length of stay. In no case shall the add-on exceed the actual ancillary and room and board costs of the facility; and (3) The addition of an approved intern and resident teaching program. This is the only circumstance that is eligible for a rate reconsideration request by a new provider. (b) A provider may also obtain a rate reconsideration if it provides an atypically high percentage of special care, determined as follows. In order to obtain the relief, the provider must meet each of the tests and follow each of the procedures defined below: (1) One or more of the facility's per diem rates is affected by the ceiling in its classification for that type of service; (2) The percentage of the facility's base year medicaid special care days over total base year medicaid days (excluding days that are reported in the nursery cost center on the cost report) is greater than one hundred fifty per cent of the same average for all other facilities in its classification. The data to perform the comparison shall be obtained from the base year medicaid cost reports; (3) The facility's average per diem costs for both general inpatient routine service and special care, excluding capital related costs and medical education costs, are no greater than one hundred twenty per cent of the weighted average for all other facilities in the same classification. The data to perform UNOFFICIAL 1739-30 the comparison shall be obtained from the base year medicaid cost reports; (4) The provider must analyze its base year costs and vary its special care percentage to determine its break-even point. This analysis shall be performed for each PPS rate that was affected by a component ceiling; (5) The provider must compute its special care percentage based upon the most recent information available; (6) The provider must certify to the department in conjunction with its rate reconsideration request that, based upon its most recently filed cost report, the percentage defined in section 17-1739-78(b)(2) continues to exceed one hundred fifty per cent of the average for all other facilities in its classification during the base year. The certification shall be based upon a cost report classification method that is consistent with the method that the facility used in the base year medicaid cost report; and (7) The provider must submit the results of all of the foregoing analyses and calculations, along with its certification, to the department as part of its rate reconsideration request. For each rate category in which the most recent special care percentage exceeds the break-even point, the provider shall have the applicable PPS rate increased by the amount that it was reduced due to the application of the component ceilings. For each rate category in which the most recent special care percentage is equal to or less than the break-even point, the provider shall receive no increase in its PPS rates. (c) Requests for reconsideration shall be submitted in writing to the department and shall set forth the reasons for the requests. Each request shall be accompanied by sufficient documentation to enable the department to act upon the requests. Documentation shall include the data necessary to demonstrate that the circumstances for which reconsideration is requested meet the requirements noted above. Documentation shall include: UNOFFICIAL 1739-31 (1) A presentation of data to demonstrate reasons for the hospital's request for rate reconsideration; and (2) If the reconsideration request is based on changes in patient mix, then the facility must document the change using diagnosis related group case-mix index or other well- established case-mix measures, accompanied by a showing of cost implications. (d) A request for reconsideration shall be submitted within sixty days after the prospective rate is provided to the facility by the department or at other times throughout the year if the department determines that extraordinary circumstances occurred. The addition of an approved intern and resident teaching program shall be one example of that type of extraordinary circumstance that justifies a mid-year rate reconsideration request. (e) The provider shall be notified of the department's discretionary decision in writing within a reasonable time after receipt of the written request. (f) Pending the department's discretionary decision on a request for rate reconsideration, the facility shall be paid the prospective payment rate initially determined by the department. If the reconsideration request is granted, the resultant new prospective payment rate shall be effective no earlier than the first date of the prospective rate year. (g) A provider may appeal the department's decision on the rate reconsideration. The appeal shall be filed in accordance with the requirements of chapter 17-1736. (h) Rate reconsiderations granted under this section shall be effective for the remainder of the prospective rate year. If the facility believes its experience justifies continuation of the rate in subsequent rate years, it shall submit information to update the documentation specified in subsection (c) within sixty days of notice of the facility's rate for each subsequent rate year. The department shall review the documentation and notify the facility of its determination as described in subsection (e). The department may, at its discretion, grant a rate adjustment which is automatically renewable until the base year is recalculated. [Eff 11/13/95 ] (Auth: HRS §346-59) (Imp: 42 C.F.R. §447.252)