Rate Determination

(1) Rate Calculation. The Division willcalculate the rate bydetermining total reimbursable rate year costs, subtracting client resources and, if necessary, dividing by projected service units. (a) For programs having at least one year of historical cost, the Division will determine total reimbursable rate year costs by: 1. Adjusting the most recent available annual cost data using the principles set forthin114.5 CMR 4.04 2. Increasing adjusted historical costs, exclusiveoffixed costs as defined in 114.5 CMR 4.02, by a cost adjustment factor to project them to the rate year. The cost adjustment factor shall reflect appropriate projections of inflation indices and shall to the extent practicable be consistent with cost adjustment factors used in other Division regulations for similar providers. In appropriate circumstances the cost adjustment factor may be zero. 3. Adjusting forthe reasonable costs negotiated by the provider and purchasing governmental unit which relate to the following: a. Increases in operating costs due to compliance withchanges inthe laws or regulations concerning licensing or safety; b. Changes in operating costs due to negotiated changes in the program; or c. Unforeseen or unusual increases in operating costs which are beyond the control of the provider and which are not contemplated in the cost adjustment factor. (b) For programs not having at least one year of historical cost, the Division will determine total reimbursable rate year costs by adjusting budgeted costs using the principles set forth in 114.5 CMR 4.04 and including negotiated costs as allowed for established programs pursuant to 114.5 CMR 4.05(1)(a)3. 4.05: continued (2) Rate Calculation for Out-of-State Providers. The Division will calculate the rate based upon, at its discretion, the provisions of 114.5 CMR 4.05, the out-of-state provider’s current charge to the general public, or the rate established by an out-of-state governmental agency. (3) Requirements for Consultant Services. (a) Requirements of Rate Approval. Any governmental unit purchasingconsultant services from a provider under 114.5 CMR 4.00 shall file, or cause to be filed, a copy of the agreement for the provision of consultant services with the Division. In the absence of a written agreement, the governmental unit shall provide a description of the services being purchased, the name of the provider of such services, and the rate of payment which the governmental unit proposes to pay such provider. In the absence of a specific provider, the governmental unit shall provide a description of the services and the rate which it proposes to pay such provider. (b) Standard ofReview. If the Division determines that the consultant services are subject to its rate determination or approval authority but are not subject to rate determination under any other chapter of 114 CMR, it shall review the proposed rate of payment under 114.5 CMR 4.00. If the proposed rate of payment is reasonable for the consultant services provided, the rate shall be approved by the Division, in accordance with M.G.L. c. 118G. In reviewing the reasonableness of the proposed rate, the Division may refer to the prudent buyer concept, rates determined under the chapters of 114 CMR, rates determined under 801 CMR 4.07 and the payment Title Code Manual issued by the Division of Personnel Administration. (4) Rate Calculation where Information Is Insufficient. Ifthere is insufficient information to apply the provisions of114.5 CMR 4.05(1)(a) or (b) or 114.5 CMR 4.05(2), the Division inits discretionand with the consent of the provider and principal purchasing governmental unit, may certify a rate determined in anymanner consistent with the principles set forth in 114.5 CMR 4.00 and the Division’s authority under M.G.L. c. 118G. (5) Federally Determined Rate. The Division at its discretion may certify a rate equal to a rate established by an agency of the Federal Government, including, but not limited to, the Health Care Finance Administration(HCFA) or Indian Health Services. (6) Rate Limitations. (a) No rate approved under 114.5 CMR 4.00 shall exceed a program's established charge. (b) Except in the case of cost reimbursement, no purchasing governmental unit may pay less than the rate established by the Division. (7) Reimbursement as Full Payment. Each provider shall, as a condition of acceptance of payment made by one or more purchasing governmental units for care provided, accept the rate established by the Division as full payment and discharge of all obligations for the care so provided. There shall be no duplication or supplementation ofpayment from sources other than those expressly recognized or anticipated inthe computation of the rate. Any client resources or third party payments on behalf ofa publicly aided client, not expressly recognized oranticipated in the computation of the rate, shall reduce the obligation of the appropriate purchasing governmental unit for care rendered to that client.