Agencies late to get Medicaid proposals

Files show drafts in works months with nursing home consultants in loop

Months before the state proposed rules limiting inhome Medicaid assistance for the elderly and disabled, consultants hired by a nursing home association were helping to craft the details.

“Here are the waiver drafts for your review,” Rachel Bunch, director of the Arkansas Health Care Association, said in a March 16 email to top officials with the state Department of Human Services.

Attached were proposed amendments to the federal waivers authorizing the ARChoices program, which offers in-home care to 8,800 elderly or disabled Arkansans, and Medicaid assistance for 1,200 residents of assisted-living facilities.

Over the next few months, Bunch and the association’s consultants traded revised drafts of the waiver amendments and proposed rules with Human Services Department officials, with both the officials and consultants offering suggestions for changes.

Not until Oct. 8, when the rules were posted to the state Medicaid program website, did agencies that provide the in-home care, advocates for the poor and elderly, and other members of the public, get to see them.

Some providers and advocates say the process allowed the nursing home industry to craft rules that will help it at the expense of consumers and other providers.

“I think the nursing home association has as much right

to be involved in proposed changes to DHS rules as anyone,” said Herb Sanderson, the AARP’s Arkansas director. “What I take exception with is, apparently they were involved and nobody else was.”

The proposed changes would reduce the rates paid to assisted-living facilities by nearly 22 percent and set annual, per-person caps on the in-home help provided to participants in the ARChoices program.

Although the cuts are part of a state plan to curb the growth of Medicaid spending, some advocates and providers say the reductions will cause more disabled and elderly people to end up in nursing homes, where the cost of their care will be higher.

The rules, which would take effect Jan. 1, cleared the House and Senate public health committees last week and will go the Legislative Council’s Administrative Rules and Regulations Subcommittee for approval Tuesday.

The nursing home association’s involvement stemmed from a deal it struck with Gov. Asa Hutchinson in 2016 as an alternative to the state hiring managed-care companies to handle Medicaid benefits for the elderly and disabled.

The group pledged to reduce Medicaid spending on nursing homes, assisted-living facilities and in-home care by $250 million over five years.

To assist with the effort, it hired Kip Piper, president of the Health Results Group in Washington, D.C., and Ann Rasenberger, president of Care Management Strategies in Columbia, Md.

“Kip and Ann have worked really hard on these and have done an excellent job,” Bunch wrote to Human Services Department officials on May 5 as she sent them a draft of the proposed waiver amendments, provider manuals reflecting the proposed revisions, and other proposed regulations.

Bunch noted in an interview that the state has already implemented parts of the nursing home association’s plan that affected its own members. That includes eliminating a temporary, enhanced rate that had been paid to a nursing home when a new owner takes it over, tightening restrictions on when new nursing homes can be built and capping Medicaid reimbursement for liability insurance at $2,500 per bed.

It’s a “misconception” her group wants to take business from other providers, she said.

She noted nursing homes are penalized by Medicare for excessive readmissions, giving them a financial incentive to support home-based care.

“Arkansas is very fortunate to be able to offer a broad variety of services to the citizens who rely on Medicaid in the community for their care,” she said. As the state’s elderly population grows, she said, “we want to have programs that are sustainable, so that the whole long-term care continuum can work together.”

The association’s consultants also provided Human Services Department officials with slide presentations and handouts to use in meetings with home-care and assisted-living providers, according to department emails obtained through the Arkansas Freedom of Information Act by the Arkansas Residential Assisted Living Association.

The department received “questions and feedback” during those sessions, which included a Web seminar in May and five meetings around the state in June, that “helped us shape and refine the final package,” Human Services Department spokesman Marci Manley said in an email to the Arkansas Democrat-Gazette.

She said the informal discussions were the culmination of the meetings that Mark White had with providers after he started work in February as deputy director of the department’s Aging, Adult and Behavioral Health Services Division.

Asked if ARChoices beneficiaries were invited to the meetings, Lainey Morrow, another department spokesman, said in an email that they “were welcome to attend each training session.”

She said the nursing home consultants provided “technical and drafting assistance,” but that the “final versions of the rules were crafted and approved by DHS staff.”

“All of the policy decisions were made by DHS,” she said, including “final decisions” on establishing cost caps for ARChoices participants and determining how high to set the caps.

“These rules were written to ensure a sustainable path forward for the ARChoices program, which has shown significant growth in the number of beneficiaries served,” Morrow said. “Our primary goal has [been] and remains to ensure individuals can be served in the most appropriate environment to meet their health and safety needs and to stay in their home as long as safely possible.”

The proposal would cap ARChoices benefits at $30,000 a year for recipients with the greatest needs — those who require total or extensive assistance with moving from one place to another, eating and using the bathroom.

Enrollees requiring assistance with only two of those activities would be eligible for up to $20,000 of care. The annual cost for those with less extensive needs would be capped at $5,000 each.

Enrollees who are currently receiving more than $30,000 would be allowed to continue receiving their current level of care in 2019 and 95 percent of that amount in 2020.

The state would also scrap an algorithm currently used to assign recipients to “resource utilization groups” based on their medical diagnoses and answers to questions about their needs.

Instead, the hours would be calculated based on an estimate of how many minutes of assistance the recipient needs with tasks such as dressing, eating and bathing.

White said the nursing home association wasn’t involved in the proposal to cut rates for assisted-living facilities. That stemmed from an actuarial study commissioned by the department, he said.

The plan is part of a state effort to slow the growth of Medicaid spending by $835 million from the fiscal year that started July 1, 2017, through fiscal 2021.

Hutchinson set the goal, which was endorsed by a legislative task force, in 2015 as a way to help pay for the cost of expanding Medicaid to cover adults with incomes of up to 138 percent of the poverty level.

Luke Mattingly, chief executive of Carelink, the central Arkansas Area Agency on Aging, said he attended meetings earlier this year in which the Human Services Department or nursing home association provided updates on the savings plan, but he didn’t find there to be “an effective feedback loop.”

“It was much more, ‘This is how it’s going to be,’” he said. “Not, ‘What do you think about this and how can we make this better?’”

He said he’s worried that the cost caps will result in inadequate levels of care and that the reimbursement to providers won’t be enough to cover the cost of implementing new requirements, such as expanded background checks for care aides. His agency serves 247 ARChoices recipients in Pulaski, Faulkner, Saline, Lonoke, Prairie and Monroe counties.

The involvement of the nursing home industry is also a concern, he said.

“It would seem that there’s a conflict of interest there, and certainly that group is an extremely strong lobby within the state of Arkansas,” he said.

Tammy Dobbs, a 59-yearold ARChoices recipient with cerebral palsy who lives in Cherokee Village, said she first heard about the changes about a month ago, from her attorney with Legal Aid of Arkansas.

Challenges by the Jonesboro-based organization have prevented the state from reducing her allotted hours of in-home help with tasks such as dressing and bathing, but she said she’s concerned about how the proposed changes could affect her.

“If I don’t make the maximum [number of hours], I will have to do without a lot,” she said. “Bathing and eating and things like that would have to be scheduled just right, or some of them will just have to be done without.”

State officials did make changes in response to public comments after the proposed rules were published in October. Those included scrapping a proposed prohibition on employees of home-care agencies caring for relatives and phasing in the rate cut for assisted-living facilities over a year.

Melanie Gloster, director of the Home Care Association of Arkansas, which represents 86 home-care and home health agencies, said the nursing home association’s involvement was valuable in preventing the state from turning to managed care, which could result in more severe cuts in rates and services.

The short amount of time providers had to study hundreds of pages of proposed rules resulted in confusion that the Human Services Department has been helping to clear up, she said. Providers are working with the department on how to implement the rules and “minimize the impact on people receiving services,” she said.