HB1447 94TH GENERAL ASSEMBLY

LRB094 08802 RSP 39019 b

94TH GENERAL ASSEMBLY
State of Illinois
2005 and 2006
HB1447

Introduced 2/10/2005, by Rep. Lee A. Daniels - Raymond Poe - Patricia R. Bellock - Eileen Lyons

SYNOPSIS AS INTRODUCED:

20 ILCS 1705/54

from Ch. 91 1/2, par. 100-54

Amends the Mental Health and Developmental Disabilities Administrative Act. Provides that the Department may perform certain acts for the development of rates for the purchase of fee-for-service care. Adds persons with mental illness and substance abuse as persons the Department may develop the rates for. Provides that in setting rates the Department should consider market factors such as those published by the United States Department of Labor, Bureau of Labor Statistics. Authorizes the Department to contract with an independent consulting firm for certain studies of reimbursement rates to service providers. Provides that the Department shall establish and promulgate a policy that precludes applicability of income offsets in rate calculation or payment processes (now, establish and promulgate a policy regarding applicability of these offsets). Makes other changes. Effective July 1, 2005.

FISCAL NOTE ACT MAY APPLY

A BILL FOR

AN ACT concerning State government.

Be it enacted by the People of the State of Illinois, represented in the General Assembly:

Section 5. The Mental Health and Developmental Disabilities Administrative Act is amended by changing Section 54 as follows:

(20 ILCS 1705/54) (from Ch. 91 1/2, par. 100-54)

Sec. 54. Establishment of rates for purchase of services including fee-for-service.

(a) It is the purpose of this Section to establish procedures for the development, calculation, and communication of rates promulgated by the Department for the purchase of services including fee-for-service for persons with a developmental disability, mental illness and substance abuse, and persons with mental illness; to require the promulgation of rules which specify the treatment of costs for purposes of establishing rates for various purchase care program categories including fee-for-service; to require that rates be equitable, understandable, and established through an open, public process; and to require the delineation of where purchase care including fee-for-service, grant-in-aid, and other payment mechanisms are most appropriately utilized. The Department's rate-setting policy should stimulate the development of cost effective, evidence based, clinically appropriate, recovery oriented, community-based residential, and other support services for recipients according to an annual statement of purchase care goals and objectives.

(b) The Department shall establish rates in all instances where services are purchased by the Department for a specific recipient from a specific community service provider for which the Department has the responsibility for establishing payment rates. When determining rates, the Department shall take into consideration differences in the costs of doing business among the various geographic regions of the State and shall set rates that reflect those differences. In addition, the Department shall consider market factors such as those published by the United States Department of Labor, Bureau of Labor Statistics. The Department may, for various program categories, adopt rates that are set by other State agencies.

(c) The Department shall perform the following duties:

(1) Develop rate-setting methodologies for purchase care program and service categories including fee-for-service programs and services.

(2) Promulgate rules and regulations governing rate-setting, treatment of costs, treatment of occupancy, and payment and contracting processes for purchase care including fee-for-service.

(3) Collect cost and performance information from care providers in a form and format that is consistent with a fee-for-service methodology. The Department may stipulate forms, unit of service definitions, reporting procedures and reporting intervals.

(4) Calculate purchase of care, including fee-for-service, reimbursement rates for specific providers based on the promulgated rate methodology for that program or service category.

(5) Negotiate and implement purchase of care contracts, including fee-for-service contracts, with specific providers.

(6) Develop capacity grants and capacity grant contracts for services that require care availability, and coverage that is not correlated with volume of service and for financially supporting desired provision of care throughout the State. Develop an annual statement of purchase care goals and objectives detailing maximum units of service by program category to be purchased. The plan for each fiscal year shall be completed by May 1 of the previous fiscal year.

(7) The Department shall contract with an independent consulting firm for an annual study of the adequacy and appropriateness of Title XIX and State-only reimbursement rates to service providers. A complete study of reimbursement rates shall be completed no less frequently than once every 2 years. The Department shall report to the General Assembly no later than January 30, 2007 and each year thereafter. Conduct an annual review and prepare an annual report of rates and units of service purchased, comparing the annual purchase of care statement with actual services purchased, and the actual cost of providing those services. The report shall be made available by May 1.

(8) Establish and promulgate a process and criteria for appealing rates.

(9) Develop and promulgate standards and criteria by which provider performance shall be evaluated.

(10) Set rates based on published methodologies and subject to the availability of funds appropriated by the General Assembly.

(11) Establish and promulgate a policy that precludes regarding applicability of income offsets in rate calculation or payment processes.

(12) Develop criteria for selection of payment mechanisms to be employed in funding community services where fee-for-service is not appropriate.

(d) The Department may investigate and employ alternative rate setting approaches such as per member or per month or case rates and engage in demonstration projects. These approaches must be publicly articulated by the Department, identifying the purpose and scope of the alternative approach and evaluation to be conducted.

(e) (Blank).

(Source: P.A. 89-58, eff. 1-1-96; 89-507, eff. 7-1-97; 90-423, eff. 8-15-97.)

Section 99. Effective date. This Act takes effect July 1, 2005.