Texas Administrative Code › Title 1 - ADMINISTRATION › Part 15 - TEXAS HEALTH AND HUMAN SERVICES COMMISSION › Chapter 355 - REIMBURSEMENT RATES › Subchapter F - REIMBURSEMENT METHODOLOGY FOR PROGRAMS SERVING PERSONS WITH MENTAL ILLNESS OR INTELLECTUAL OR DEVELOPMENTAL DISABILITY › Section 355.761 - Reimbursement Methodology for Institutions for Mental Diseases (IMD)

Current through Reg. 49, No. 28; July 12, 2024
(a) The Health and Human Services Commission
				  (HHSC) determines IMD reimbursement biennially. A statewide prospective
				  reimbursement will be available to all eligible IMD providers for reimbursable
				  IMD services. This reimbursement is inclusive of all costs allowable under
				  Medicare payment principles.
(b)
				  Initial reimbursement period. The initial reimbursement period is defined as
				  November 16, 1994-April 30, 1996. The reimbursement for this period is
				  determined from Medicare cost reports for state-operated hospitals, which
				  provided IMD services between September 1, 1993, and August 31, 1994. The
				  Medicare cost reports are reviewed by HHSC to assure that the costs used for
				  calculating each hospital's average per diem cost for IMD services are
				  allowable under Medicare payment principles and are only those costs incurred
				  by the hospital for care and treatment provided to persons 65 years and older
				  and occupying a Medicare-certified bed. Using these Medicare cost reports, each
				  hospital's average per diem cost for IMD services is calculated. HHSC adjusts
				  each hospital's average per diem cost for IMD services to the initial
				  reimbursement period by applying a cost-of-living index. The cost-of-living
				  index used is the Centers for Medicare and Medicaid Services (CMS) Market
				  Basket Forecast Excluded Hospital Input Price Index (as reported in the Dallas
				  Regional Medical Services Letter Number 95-015). Due to the length of the
				  initial reimbursement period, the percentages by which the average per diem
				  costs are adjusted are prorated by taking 1/12 of the forecast for calendar
				  year 1994 plus 2/12 of the forecast for calendar year 1995 plus 4/12 of the
				  forecast for calendar year 1996. After adjusting the average per diem cost for
				  each hospital, the average per diem costs for all of the hospitals are arrayed
				  from high to low. The median (50th percentile) average per diem cost is
				  selected as the prospective reimbursement for the initial reimbursement period.
				  If the 50th percentile falls between IMD providers, then the immediately higher
				  average per diem cost will be selected as the reimbursement.
(c) The reimbursement period begins on
				  September 1 and ends on August 31 of the following year.
(1) Annually, each IMD provider is required
				  to submit to HHSC a copy of its Medicare cost report for its most recent fiscal
				  year ending prior to September 1. Cost reports must be received by HHSC no
				  later than 90 days following the end of the IMD provider's fiscal year. Each
				  IMD provider is required to identify in its cost report as a subunit (IMD unit)
				  those Medicare-certified units on which reimbursable IMD services were
				  provided. The Medicare cost reports are reviewed by HHSC to assure that the
				  costs to be used for calculating each IMD provider's average per diem cost for
				  IMD services are allowable under Medicare payment principles and are only those
				  costs incurred for care and treatment provided to persons 65 years of age and
				  older and occupying a Medicare-certified bed.
(2) Upon completion of the reviews of cost
				  reports, and prior to calculating average per diem costs for each IMD provider,
				  cost reports and prior payment histories are reviewed. To ensure the integrity
				  of the data and avoid bias in the resulting reimbursement due to low volume and
				  other inefficiencies, cost reports of IMD providers will be eliminated from the
				  database for any one of the following reasons:
(A) being in operation fewer than 90 calendar
				  days during the previous cost reporting period;
(B) having an occupancy rate on its IMD units
				  of less than 90% for 50% or more of the days covered during the previous cost
				  reporting period; or
(C)
				  individually accounting for fewer than 5.0% of the total days of care
				  reimbursed by Medicaid as IMD services during the previous cost reporting
				  period.
(3) Using the
				  Medicare cost reports in the database, HHSC calculates for each IMD provider an
				  average per diem cost for IMD services. Each IMD provider's average per diem
				  cost is adjusted to the future reimbursement period by applying a
				  cost-of-living index. The cost-of-living index used is the Centers for Medicare
				  and Medicaid Services (CMS) Market Basket Forecast Excluded Hospital Input
				  Price Index (as reported to the States in the Dallas Regional Medical Services
				  Letter for the federal fiscal quarter ending in December of the year preceding
				  the next reimbursement period). The percentage used for adjustments to each IMD
				  provider's average per diem cost is prorated, using 1/3 of the forecast for the
				  calendar year in which the reimbursement period begins (September through
				  December) plus 2/3 of the forecast for the next calendar year (January through
				  August).
(4) After adjusting the
				  average per diem cost for each IMD provider, the average per diem costs of all
				  IMD providers remaining in the database are arrayed from high to low. The
				  median (50th percentile) average per diem cost is selected as the prospective
				  reimbursement for the future reimbursement period. If the 50th percentile falls
				  between IMD providers, then the immediately higher average per diem cost will
				  be selected as the reimbursement. The prospective reimbursement rate is
				  compared to the Support, Maintenance and Treatment (SMT) rate. All IMD
				  providers will be paid the lower of the prospective rate or SMT rate for each
				  day during the next reimbursement period that IMD services are provided to an
				  eligible individual.