ARRM's Daily Dispatch

Are You Preparing Your CWS Distribution Report?

It’s been awhile since I’ve written anything here about the Disability Waiver Rate System (DWRS) or related topics, but I’ve started to get some questions from providers about the Competitive Workforce Factor (CWF) distribution report requirements, so I thought I would provide some information.

First, a little background. When the legislation that included the CWF passed in 2019, it included some broad language about a distribution report that providers would have to prepare by December 31, 2020. At that time, the Minnesota Department of Human Services (DHS) advised that guidance would be provided in early 2020 to give providers the information needed in a timely manner. Well, something else happened in early 2020 known as a global pandemic, and timelines got a little messed up. But, on July 29, DHS released a bulletin with more specific information about the distribution reports.

First, it’s important to remember that the intended audience for these reports is the direct support staff employed by each provider organization, and the staff must have access to the reports for at least one calendar year. Providers must also make their reports available to DHS upon request; DHS will notify providers if their report is selected for review. DHS does NOT say that they will review a certain number of reports, and it is not clear what would trigger a review. My sense from conversations with DHS Disability Services Division staff is that they are not intending to systematically review reports unless questions or concerns are raised about them. But that is not an official DHS position.

Which providers must create distribution reports? Any provider that received revenue in 2020 through DWRS framework services that included the CWF. Providers that received revenue for customized living and/or 24-hour customized living as the ONLY framework services are exempted.

What should a distribution report include? There are 3 elements that must be included.

First, a description of the CWF in language that makes sense to the direct support staff. (DHS provides suggested language on their website, but providers may use their own).

Second, the report should include an estimated dollar amount from the CWF for services expected to be delivered in 2021. This is important: not actual CWF dollars received in 2020, but an estimate for 2021. Rate exceptions are excluded from this estimate.

Third, the report has to describe the SPECIFIC ways in which the revenue will be used by the provider organization. Some examples of how revenues may be used include maintaining or increasing direct support wages and/or benefits, or actions taken by the provider to support direct care workers during COVID-19 disruptions. It is possible that the changes outlined in this section may have been implemented prior to the release of the report (i.e., earlier in 2020).

Who can I contact if I have questions? The DHS rates email box is always a good place to go with questions on issues like this. They are generally pretty responsive. Or, you can direct general questions to me and I will answer as best I can or try to find an answer.

There are a few other items to note. Earlier this week, DHS released the DWRS component value rates for 2021. They can be found here. A few highlights:

• New services and service names from Waiver Reimagine are reflected
• Hourly wages are now shown as base rate plus new rate with CWF
• Asleep wages for direct support are increased from $10.00 to $10.08 in corporate residential settings, and from $3.60 to $3.63 for family residential settings

Work on the Waiver Reimagine waiver reconfiguration project is continuing, and DHS is holding some virtual events to gather feedback from stakeholders. More information is available on the Waiver Reimagine webpage.

In 2019, ARRM supported passage of a study and legislative report on value-based payment models. Work on this study by DHS was also pushed back due to COVID-19, but DHS will be sending a survey to stakeholders any time and holding feedback sessions over the next 45 days or so. We will be including information on this in our regular emails when we receive it. Also, our Alternative Payment Model Workgroup will be leading an educational session as part of the virtual Business and Finance Forum on November 17. We hope this will be an affordable and accessible opportunity for many of you to learn more about this topic.

-Ken Bence, Director of Research, Analysis and Policy

Competitive Workforce Factor: What's the Latest?

In mid-December, DHS received approval from CMS to implement all the waiver amendments DHS had proposed, including the Competitive Workforce Factor (CWF) that the Legislature passed in the 2019 special session (MN Statute 256B.4914, Subd. 5(b-h)). As a reminder, the CWF, which went into effect on January 1, 2020 is a 4.7% adjustment to the direct care staff wage component of the Disability Waiver Rate System (DWRS). The addition of this new factor adds another layer of complication to the rate calculations upon service renewal for individuals on a disability waiver. For all new and renewing service authorizations that go into effect on or after January 1, the following changes will be applied:

• End of banding: all individuals who were on historic or banded rates since the implementation of the DWRS in 2014 will be on the framework rate calculated by the Rate Management System going forward
• Increase in state minimum wage: the wage component for asleep staff in residential settings will increase from $9.86 to $10.00 per hour due to the increase in the state’s minimum wage
• New Competitive Workforce Factor: As described above, this new factor adds a 4.7% adjustment to the hourly wage for awake direct care staff. This factor does not apply to asleep, supervisory, or nursing staff wages.

Another provision of the legislation that created the CWF was a new requirement for providers to “identify additional revenues from the competitive workforce factor and prepare a written distribution plan for the revenues,” which, by December 31, 2020, must be made “available and accessible to all direct care staff for a minimum of one calendar year.” The plan must also be submitted to DHS upon request. By design, there is no additional guidance in the statute as far as requirements for these distribution plans, because DHS and the legislature intended to provide a great deal of flexibility for providers. This high degree of flexibility, however, can also be confusing because providers don’t know if the plans they create will satisfy the expectations. Through our involvement with the DWRS Advisory Committee, ARRM has been working with DHS to establish some parameters to guide providers as they prepare their distribution plans. Information is still evolving, but here’s what we know at this point:

• There are two elements that must be part of each distribution plan:
  • Providers shall identify additional revenues received from the CWF, isolated from any other rate changes due to the end of banding, changes in an individual’s units of service, or rate exceptions
  • Providers shall identify whether additional revenues are used to support staff compensation (wages, benefits, etc.), and if so, how
• Providers may not actually realize a net increase in revenue when the other rate changes mentioned above are factored in, and if they are unable to make changes in staff compensation, that needs to be explained
• Changes to staff compensation can be implemented at any time based on business needs

DHS intends to issue official guidance later this year, most likely in the late spring or early summer. The DWRS Advisory Committee, which meets every other month on the odd-numbered months, will be a primary venue for stakeholder input

ARRM will continue to monitor and participate in the development of the official guidance. If you are interested in joining the next DWRS Advisory Committee meeting on March 19, contact Ken Bence for more information. Also, if you think your organization might need some help with isolating and calculating the revenue attributed to the CWF, see the information and pricing structure for customized consultations on ARRM’s Competitive Workforce Factor web page.

Other Scheduled Rate Adjustments

As if all the Competitive Workforce Factor information wasn’t enough, the Legislature also passed some other new language in 2019 that will impact rates calculated by DWRS in the future. Both the update to the base wage index (MN Statute 256B.4914, Subd. 5(i)) and the inflationary adjustment to certain component values based on the Consumer Price Index (MN Statute 256B.4914, Subd. 5(k)), which will take place on July 1, 2022, will now be based on data that is available from the Bureau of Labor Statistics “30 months and one day prior to the scheduled update,” rather than the most recently available data. That translates to data that was available on December 31, 2019 – which means we can calculate the adjustments now. So let’s break it down.

Base Wage Index Amounts
There are 25 staff types enumerated in the statute, each with a wage value based on formulas that involve standard occupational classification codes (SOC) from the Bureau of Labor Statistics. The staff types, along with their current and new wage component values, can be found here. In short, the updates will amount to an aggregate wage component increase of about 11.4%, effective July 1, 2022.

Inflationary Adjustments
The inflationary adjustments on July 1, 2022, based on the percentage change in the CPI-U since the date of the previous update on July 1, 2017, will apply only to the client programming and supports and transportation component values in the rate structure. In corporate and family residential services, these components are specific dollar amounts, while in day services, unit-based services without programming except respite, and unit-based services with programming, the client programming and supports component is a percentage of the sum of direct staffing costs, employee-related expenses and program supports. The transportation component values in day services, when applicable, are based on a schedule that reflects the type of vehicle, mileage traveled, and whether the rides are individual or shared.

The CPI-U information available from the Bureau of Labor Statistics on December 31, 2019 was from November, 2019 and reported an aggregate increase of 4.8% between July 1, 2017 and November 30, 2019. In residential services, the component values to which this adjustment applies amount to approximately 5% of the total daily rate, so in other words, about a 0.25% overall increase to a daily rate. In unit-based services, the impact will vary based on the mix of services used by each individual.

So, where did I lose you in this complex walk through rate adjustments that won’t even go into effect for 2 years, assuming the Legislature doesn’t change or repeal them in the meantime. Remember, if you need help, we have assistance available through our customized consultation service, as mentioned above.

--Ken Bence, Director of Research, Analysis and Policy

DHS Pushes Back Daily Billing Requirement

Earlier this week, the Minnesota Department of Human Services made the decision to push back its new requirement for providers to bill daily for services provided to March 5, 2018. Home and Community Based Service providers should continue to bill as they have been until that date.

When this requirement takes effect it will mark a major change for many ARRM members and have significant impact. Billings that are not submitted correctly will be rejected for payment.

Due to impact of this change, ARRM has been working closely with DHS to ensure the department has prepared proper notice for providers and the necessary training to ease the transition process. The association has arranged for an initial training webinar, exclusive and free to ARRM members, on January 19, 2018 at 10:00 a.m. ARRM members are strongly encouraged to take advantage of this opportunity. More information on the webinar will be shared in the New Year.

***UPDATE***

 Everyone on the ARRM email list will receive the webinar log-in information directly via email the week of January 15. If you do not receive the information by January 18, please check with your company administrator that you are on your organization's roster for receiving emails from ARRM and email [email protected] to receive the webinar information.

New DWRS Component Values

The ARRM Financial Resource Committee put together the following chart for members to provide information on the new DWRS component values that went into effect on July 1, 2017 as a result of the automatic inflationary increase.

	1/1/14	7/1/17	$ Change	% Change
Daytime Staffing	$12.41	$13.53	$1.12	9.02%
Overnight Sleep Staffing	$7.66	$8.35	$0.69	9.01%
Remote Staffing	$12.41	$13.53	$1.12	9.02%
Supervision Percent	11.00%	11.00%
Supervision Wage	$17.43	$19.15	$1.72	9.87%
Custom Deaf or Heard of Hearing	$2.50	$2.50
RN	$30.82	$31.04	$0.22	0.71%
LPN	$18.64	$20.51	$1.87	10.03%
Relief Staffing	8.71%	8.71%
Taxes & Workers Comp	11.56%	11.56%
Other Benefits	12.04%	12.04%
Standard Vehicle	$1,680.00	$1,742.62	$62.62	3.73%
Adapted Vehicle With Lift	$3,000.00	$3,111.81	$111.81	3.73%
Programming & Supports	$2,179.00	$2,260.21	$81.21	3.73%
Standard General & Admin Support	13.25%	13.25%
Program Support	1.30%	1.30%
Utilization and Absence	3.90%	3.90%

 If members have questions about these changes and how they impact providers, please contact Barb Turner.

DHS Website Updated with Adult Foster Care RMS Worksheet

In April of this year DHS established business rules for shared staffing. Following this, in July new DWRS Frameworks for Adult Foster Care/SLS were posted on the DHS website. This new framework calculates shared staffing differently than in the prior framework on the Direct Staffing tab. The new methodology is set to ensure that the additional cost of awake overnight staff is shared by only those needing awake overnight staff.

The updated 6790C, which corresponds with this new calculation, is now posted on the DSH website.

As a reminder, DHS has training videos online. They have added videos related to shared staffing and determining the proper RMS inputs.

Please find related links below.

Shared Staffing Business Rules

Quick Reference Guide on Business Rules for Residential Staffing

Information on using the new worksheets

Quick Reference Guide on Residential Staffing Hours

Updated DHS-6790C form – Foster Care/SLS Daily worksheet

6790C

RMS Training Modules (section 203 for shared staffing)

RMS Training Modules

-- Luana Slayton, Chief Fiscal Analyst

New RMS Worksheet for Shared Overnight Staffing

The DWRS frameworks and RMS worksheets have been updated to show a slightly different calculation for sharing of asleep and awake overnight staff. This new calculation has been applied to the Foster Care/SLS frameworks for Corporate and Family.

The new methodology is set to ensure that the additional cost of awake overnight is shared by only those needing awake overnight.

The updated 6790 has not yet been posted, but has been developed. When we hear from DHS that the new 6790 is posted, we will send a communication to ARRM members.

-- Luana Slayton, Chief Fiscal Analyst

ALERT: DHS opens public comment period on DWRS regional variations

DHS has released two proposed options to implement the regional adjustment factor to rates in the Disability Waiver Rate System (DWRS).

The rate adjustments - based on cost differences among regions of the state - would begin January 1, 2016 as service authorizations are approved.  Current rates for existing clients would continue to be protected by banding until an individual reaches his or her final rate or when banding ends.

DHS has opened a comment period through July 31st on its two options and other considerations regarding regional cost differences related to provider rates.  One option would cap rate changes resulting from regional variations at three percent up or down; the other would have no caps.  

ARRM’s Payment Methodology Subcommittee reviewed DHS’s options last week and set up a group of seven metro and Greater Minnesota members to prepare ARRM’s response, which will also be discussed at the ARRM Board meeting next week.   Clearly, all the varying cost drivers among regions – and pockets within those regions – cannot be fully addressed based on the limited data used in developing the options.  

Those data, prepared by Truven Health Analytics, only included wages by regions, with some regional subsets.  But no matter how detailed in cost factors and sub-regions, the end result will create some rate “winners” and some “losers.” Indeed, members of the subcommittee agreed, the underlying problem for all providers is inadequate funding for the system as a whole.

Given that the adjustments will be based the existing dollars in the system – budget neutrality – and any adjustment would move dollars among regions, ARRM will seek positions that fairly address concerns of all members across the state.  

Individual ARRM members may also comment on the regional adjustments and the two options.  

The above link provides additional links to the two options, Truven’s analysis (called Minnesota Regional Variation Analysis Final Report Jan. 30, 2015), and where to send your comments.

ARRM will provide more information as the issue develops.

-- Bruce Nelson, CEO

ARRM meets with DHS to discuss concerns

ARRM requested a meeting this week with DHS staff to discuss numerous concerns, primarily related to the new rate setting system.  The intent of the meeting was to not only share information with DHS on problems but to request some concrete action steps. 

Some of the issues addressed in the meeting included:

• Prorating of leave days so that providers could not bill for all days of service from January 1, 2014- March 31, 2014
• Misunderstanding, misinformation, or lack of information at the county level
• Lack of clarity/direction on shared staffing
• Lack of direction to counties on nursing hours
• Problems that are resulting in individuals not getting services
• Delays in SAs or errors in SAs that result in providers not being able to bill
• The appearance that there are not systems in place to address what appear to be systemic problems across many counties
• Inconsistency with information from the Help Desk

The list is not all inclusive, and there was agreement that not all issues can be dealt with at the same time. Following the meeting, DHS staff agreed to meet to develop some action steps. 

There was agreement to take the following immediate action steps:

• DHS will assure that all counties have the correct information so that SA's that had units adjusted for the period of January 1, 2014 - March 31, 2014 will be corrected if needed.
• There will be more direct communication to counties and a system implemented that will keep us informed on what is being shared with counties.
• DHS will make the issues of shared staffing and nursing a top priority with the intent to begin working with the Minnesota Department of Health on the nursing issue following the end of the legislative session. 
• DHS will do look into issues that result in providers being unable to bill for services in a timely manner.

ARRM will continue to work with DHS to assure that they remain informed on issues and that continued progress is made to resolve problems that are identified.

You may contact Barb Turner [email protected] with questions.

--Barb Turner, COO

Summary of DWRS provisions adopted by the MN Senate

The DWRS Coalition’s Disability Waiver Rate Setting (DWRS) bill moved through the Senate committee process and was negotiated with DHS with surviving or modified sections now in the Senate Omnibus Finance Bill.  That bill, which includes all new state government funding, is now in a House/Senate conference committee.  We expect the House to approve the Senate DWRS provisions.

The following are outcomes of provisions that the ARRM Board of Directors identified as priorities for our membership. 

You can also  Download DWRS section summary prepared by Kevin Goodno, with Fredrikson & Byron, who represents MOHR. The DWRS Coalition includes ARRM, MOHR, MnDACA, the Disability Law Center, The Arc Minnesota, the Mental Health Legislative Network and Courage Center.

Outcomes of ARRM’s priority issues:

Recouping dollars that were lost in converting from the old to the new system, primarily as a result of miscalculating “leave days” and making policy decisions during the conversion process, during which every dollar spent in 2013 should carry over to 2014.

• Outcome:  DHS must review all changes to rates in effect Dec. 1, 2013 to verify that an equivalent level of spending and service authorizations occurred in the new system.  This process is to be completed by Dec. 31, 2014, with rate adjustments paid to providers for recipient rates that were reduced during the conversion process.  This will assure provide equivalent annual spending in 2014 and 2013.  Then, during the banding period, historical rates can be adjusted to cover changes in needs.

Nursing hours:  The Coalition bill’s definition for nursing kept nursing payments in the waiver rate rather than costlier options, such as private duty nursing.

• Outcome:  In negotiations the Coalition didn’t win this point for inclusion in the compromise language, but it didn’t lose.  For the time being, the status quo remains in effect with DHS advising counties that nursing is an appropriate service and taking action if counties deny or reduce the service.  To find a final resolution, DHS will put together a task force with the Health Department and other stakeholders to define incidental nursing, determine when more that 245D oversight is needed, and oversight standards.  The primary gum in the works is that while there was an agreement with the Minnesota Department of Health regarding nursing for individuals under the DD waiver - there is no such agreement for the BI and CADI waivers.

Shared staffing:  The Coalition’s bill included language to remedy situations where counties are authorizing different numbers of weekly hours for individuals, but expecting each individual to cover only 25 percent of the costs – forcing providers to subsidize some services.

• Outcome:  The agreed-to language should fix this problem by allocating hours proportionately based on actual need of each individual.

Overnight staffing:  Payments are insufficient when, for example, only one person needs awake staff and rates for the other clients are tied to sleep time rates. 

•  Outcome:  These situations were remedied by the same way as shared staffing – by allocating hours proportionately.

DHS’s system manual to provide counties with specific, consistent and complete guidance and instructions:  The current manual leaves many processes and definitions vague and thus to be interpreted differently by counties. 

• Outcome:  The Coalition’s language for making the manual more comprehensive was not agreed to and is not now in the bill.  At the same time, some of the definitions and processes are clarified in the bill and ARRM will compile a robust guide for members (and others) that will help members navigate the system and be informed when working with counties.

Monitoring technology:  Current law requires the DHS Monitoring Technology Review Panel to annually review and approve plans and rates pertaining to use of monitoring technology in residential settings; the Coalition’s bill removed the barrier of annually approving such rates and plans.

• Outcome:  This change was not agreed to by DHS.  ARRM continues to employ strategies with DHS and counties to facilitate the use of technology in adult foster care and allow people to move into more independent services and settings.

Residential transportation:  Rates have been insufficient when one or more – but not all – residents require an accessible van. 

• Outcome:  Allocations will be based on the person with the highest need so that such vans will now be paid for.

Exceptions:  The Coalition's bill added a category to allow for exceptions to a rate to pay for services that are not adequately reflected in the rate.

• Outcome:  This provision was dropped due to DHS’s fiscal note (added cost).  However, DHS said that if cost issues are linked to needs, the exception would likely be approved – noting that such exceptions have already been granted.

Keeping money in the system:  Provisions in the Coalition bill were targeted at ways to keep unspent allocated money from leaving the service system.  A substantial amount of money authorized to counties for services is unspent due to counties being fearful of being held liable for overspending.  At the same time, DHS does have the authority to reallocate unspent money among counties.

• Outcome:  For the first two years of implementation, counties will not be held liable for overspending their allocations until DHS has reallocated unspent monies. DHS is to develop a process and inform counties by July 1, 2014.

Provider and individual appeals:  The Coalition's bill reinforced the process for individual appeals and used the contested case process for providers.

• Outcomes:  Both provisions were dropped due to cost.  At the same time, individuals do have the authority to appeal reductions in services and providers likely have appeal protections under federal and state law – issues ARRM will investigate this summer.

-- Bruce Nelson with contributions from Don Priebe and Barb Turner

ARRM meets with DHS for updates on priority issues

ARRM has begun to participate in weekly meetings with DHS to stay on top of ongoing issues.  In the meeting held this week the following updates were obtained:

• Surety Bonds- DHS will be putting together an internal meeting sometime next week to discuss this issue and plans to get back to ARRM immediately after that meeting.  DHS confirmed that providers will not hear anything about implementation of the surety bond requirement until the concerns raised by ARRM have been considered.
• Involuntary/planned bed closure - DHS has requested information from counties regarding a number of issues including beds that have been closed since July 1, 2011, plans for bed closures, and plans for new development. This information is set to be submitted by August 15, 2013.  DHS will review the information and use it as it develops a plan for meeting the requirement for bed closures.  DHS hopes to share information regarding numbers before the end of August.
• In-home billing (DD waiver)- In the 2013 legislative session a repealer was passed that changes what can be billed for in-home services.  There is no longer the ability to bill for non-face to face time i.e. meeting time, planning time etc.  Some counties have begun revising service authorizations to reduce the number of units available.  When doing this counties should be adjusting the rate so that the total number of dollars available does not change.  DHS indicated that they plan to communicate with counties on this sometime next week.  If providers are working with counties who are reducing units and not increasing the per unit rate, they should first attempt to address this with the county.  If providers are not able to reach a satisfactory result they are encouraged to contact DHS Provider Relations at 651-431-2700 or 800-366-5411.
• Bulletin #13-25-04 regarding PERS - DHS clarified that the bulletin that was issued was intended to replace a previous bulletin that had expired.  It was not the intention of DHS to provide a new policy.  If providers are working with counties that have questions on this issue, they are encouraged to suggest that the county use the PolicyQuest or contact their RRS.  ARRM will have further discussion with DHS on technology issues when it meets with them again on August 20, 2013.
• MN-ITs - ARRM has been sharing with ARRM members the fact that DHS intends to continue to use, and potentially increase the use of, MN-ITS to communicate with providers.  ARRM has raised concerns with DHS on problems that providers have had with the MN-ITS system.  As a first step DHS will be offering a training that can be attended in person or via the web.  It will be held on August 30, 2013 from 1:30 p.m. to 3:30 p.m.  Information on registration will be sent to members at a later date. 

If you have questions about these or any other issues feel free to contact Barb Turner [email protected].

--Barb Turner, COO