Providers have had many questions regarding the future of New York’s CDPAP in the wake of the Albany County Supreme Court’s decision, striking down the PMPM. This article will strive to address some of those questions. First, there appears to be conflation between the Court’s decision and the “credentialing” process regarding fiscal intermediaries. To be clear, the Court’s decision striking down the DOH’s PMPM formula only dealt with how fiscal intermediaries are reimbursed—The State has yet to publish the process for becoming a fiscal intermediary or continuing to provide fiscal intermediary services. (The State is woefully behind its specified deadline to publish its application and standards for becoming or continuing to serve as a fiscal intermediary. While it is possible that the State will postpone the effective date of the new credentialing process, there is also a possibility that the State, once it receives hundreds of fiscal intermediary applications, will rush through the applications and decide the applications by December 31, 2019.
To dispel the rumors, however, the CDPAP program is far from “safe.” While the Court’s recent decision resolves a question regarding the reimbursement methodology, the Court’s decision does nothing regarding fiscal intermediaries’ ability to stay in business once the DOH publishes its new “credentialing” standards and application for such credentials. All fiscal intermediaries who wish to continue providing services, or any entity that wishes to become authorized to provide fiscal intermediary services, will have to apply through the new process.
The second question that has been raised by many providers relates to the MLTCs’ rate reductions despite the Court’s decision. Here, again, there is some confusion. The Court’s decision states that the PMPM methodology was improperly issued by the DOH. The Court’s decision does nothing to bind MLTCs who are free to demand a reduction in rates. As previously reported through my LinkedIn alerts, the State Budget Director has been clear that the State will seek to reign in Medicaid spending. There is a $2.9 billion Medicaid deficit that the State has to address in the upcoming budget season (which kicks off in January, 2020). Moreover, in the last fiscal year, approximately $1.4 billion in Medicaid payments were delayed to the MLTCs, all due to unexpected Medicaid spending and improper State budgeting. Therefore, it is not surprising that the MLTCs are reducing and controlling spending on home care services, and will continue trying to do so, because they are getting and are expected to continue getting less from the State for Medicaid programs. Home care providers, including fiscal intermediaries, will need to plan for these tightening market conditions and government spending when planning and budgeting their resources.
Lastly, the Court’s decision is not the final say on how fiscal intermediaries will be reimbursed for their services—the battle is far from over. The Department of Health may seek to codify through regulations a PMPM reimbursement methodology. Again, the budget discussions kick off in January, 2020 and there may be discussions about controlling fiscal intermediary spending through a law or regulation. To the extent that this is done, it will be extremely difficult to challenge through litigation any reimbursement changes that are codified through law or regulation. In addition, having lost the PMPM battle but facing the same pressures to control spending associated with fiscal intermediary services, the DOH may be under even greater pressure to disapprove applications for fiscal intermediary “credentialing.” Thus, once the DOH finally publishes its RFP for fiscal intermediary applications, and once those applications are submitted, the DOH may be under greater pressure (since it has lost the PMPM argument) to deny a large number of fiscal intermediary applications.