IGT TAP October 13, :00 p.m. - 3:00 p.m. Meeting Minutes

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CHARLIE CRIST GOVERNOR Better Health Care for all Floridians IGT TAP October 13, 2010 1:00 p.m. - 3:00 p.m. Meeting Minutes ELIZABETH DUDEK SECRETARY IGT TAP Members Present 1. Kevin Kearns 2.

Chris Paterson (phone) Agency Staff Present 1. Michele Morgan 2. Melanie Brown-Woofter 3. Phil Williams 4. Edwin Stephens 1. Shannon Bagenholm Non-Members Participating by Telephone 1.

1 CHARLIE CRIST GOVERNOR Better Health Care for all Floridians IGT TAP October 13, :00 p.m. - 3:00 p.m. Meeting Minutes ELIZABETH DUDEK SECRETARY IGT TAP Members Present 1. Kevin Kearns 2. Tom Wilfong 3. Michael Good 4. David Verinder (phone) 5. Scott Davis (phone) 6. Margaret Brennan (phone) 7. Mary Lou Tighe (phone) 8. Mark Knight (phone) 9. Chris Paterson (phone) Agency Staff Present 1. Michele Morgan 2. Melanie Brown-Woofter 3. Phil Williams 4. Edwin Stephens 1. Shannon Bagenholm Non-Members Participating by Telephone 1. Elaine peters 2. Scott Davis 3. Lori A. Hundley 4. Jan J. Gorrie 5. Anita B. Hicks 6. Randy Lewis 7. Jeff Harris 8. Sara Fitzgerald 9. Mary Beth Dyer Non-Members Participating in Person 1. Christine Sexton 2. Sam Rehtork 3. Jenny Roberson 4. Eric Prutsman 5. Lindy Kennedy Mah an Dri ve, MS# Tallahassee, Fl ori da Visit AHCA online at

2 6. John Owens 7. Terry Meek 8. Tony Carvalho 9. Mary Beth Dyer I. Welcome/Opening Comments Michele Morgan, Bureau Chief for Medicaid Program Analysis, opened the meeting at 1:00p.m. II. Approval of August 23, 2010 and September 22, 2010 IGT TAP Meeting Minutes: The meeting minutes from the August 23, 2010 and September 22, 2010 IGT TAP meetings were unanimously approved. III. Discussion of Draft Panel Report No draft report for review at this meeting Panel will focus on data modeling and review of requested models to include in final report Subsequent meeting will include a draft report and data models as requested of the Agency or prepared by IGT TAP members and brought to the meeting IV. Review of Data Model Spreadsheet Panel reviewed IGT spreadsheet with state wide updates added to the spreadsheet handed out at the September 22 meeting. State wide update on hospitals that have been specifically flagged that can purchase a rate buy back or cost limit exemption outside the LIP model. Agency does not currently calculate a rebased or buy back rate for these hospitals. Currently using the January 2010 rate/non exempt rate. Total Days: State FY 09/10 every day they will be paid on fee for service basis. Running models with state-wide data moved the anticipated date of getting those models done until the next meeting October 27, For data completion, Agency is using the January 2010 rate for the non exempt rate. This established the rebasing and buy back values. Panel members asked for next meeting to include same spreadsheet with the headings labeled. Purpose of this demonstration (spreadsheet) is to show how much it would cost to fund exemption and buy back for the volume of days there are now. Total IGTs that we have received for state wide issue exemptions and LIP is $753.3 million. This sheet is identifying the pot of necessary money if we wanted to fund this. The mandatory managed care expansion is only going to tough the mandatory days: the difference between mandatory days and voluntary days as compared to the total days is populations that are not going to go into managed care without some much larger authority.

3 Depending on how the authority is granted or what we are directed to do: with regard to the managed care expansion models that went through the legislature last year, there was direction that we would only have IGTs fund. 1) New growth (Any increase in the population that is currently in managed care - That increase in what it cost to fund exemptions and buybacks would no longer be funded by general revenue where it is today) and; 2) New populations. The transition of any of these days in this spread sheet from fee for service to managed care would be funded with IGTs. 1 st scenario: Taking the current population in capitated managed care, the exemption levels and buy back levels funded currently are already built into the managed care line and funded by GR, and next year that amount will increase. 2 nd scenario: the legislature identifies that we only fund the expansion population, meaning that we only take the money that is transitioning from the fee for service and going into managed care. 3 rd scenario: is that the legislature instructs that the IGTs have to fund all exemptions and buy backs for the managed care, that would include all the expansion population meaning the 70% of the mandatory days and everyone that is currently in managed care. The weighting of how much you get of a supplemental payment is going to be based upon utilization from encounter data from the participating and qualifying hospitals. The contracting criteria was to identify which health plans qualify to get the supplemental payments. The contracting is not a requirement. Scott Davis noted that in trying to separate the issue of return on IGT, it is up to the provider to negotiate a sufficient rate with the plan so whatever they are getting paid back is enough to cover what they are putting up. The only way to get a rate negotiated that would cover that level of payment is to have an agreement with the plan. I do not see how a non contracted plan could be one a provider would say is ok to get some of this money, because that plan has some of their patients - unless there is a contract. Michele Morgan noted that we have a distribution method on how we do; the cleanest and most fair way is to look at the utilization those health plans have and update it every six months and adjust the rate as needed. For securing the funding source, what will it take for the counties and the hospitals to be willing to fund the level that has historically been seen through their hospitals and facilities? What are the basic criteria the counties need to put up the money? Once we know what their criteria is what will it take to make them play ball. We need to let the counties speak up. The 15% is really coming from the federal portion. The difference between the 15% is what can be used to exempt the buyback rate; it is taking from the federal dollars Before we get to the models, if the hospital industries and counties do not believe they are willing to budge off the return; if we make a model that assumes you get a certain amount back or you don t get your IGT back, or make a methodology that assumes you get it all back and CMS comes back and says, no that s not reasonable then we need to find out know where is the county s and the hospital s threshold? Tom Wilfong noted that if you don t build the pot of money in the methodology even if they contract with that but they re based on actual utilization they may not get the

4 distribution from their days that gives them an appropriate split to be able to fund you guys at pay the claims at that level. Michele Morgan agreed with Tom. The two need to go hand in hand if we need to assume that the counties and hospitals will only play if they get a certain level of IGTs back then that needs to be built into the pot and then look at the distribution. Depending on how the counties and hospitals feel, if it has to be a direct link allocating based on utilization. If that health plan deals with six different hospitals, their utilization will be combined with all those hospitals that are qualified hospitals. Michele Morgan noted we need to know how to get better feedback and information from the counties and what it will take to get them to want to put up money. Michele Morgan added that the concern is whether or not they get back what they put up. If that is a deal breaker then we need to change gears. She is not certain if there is a methodology we could come to that will collect and distribute the money that will guarantee that within each county the money that comes through IGT will be paid back only through those participating providers. She does not know how to make a methodology that will pay the health plan & get that money back. Current authority for exemptions when making a payment to a health plan does not include managed care. We are working with CMS on renegotiating our wavier which currently does not allow for managed care to be a part of that Michele Morgan noted that we need to research how we could work towards achieving a way to bring LIP in as an avenue to find a way to help the counties feel comfortable about securing the money. How we could work toward achieving that without violating the regulations. Michele wants to stress the methodology that the payment for health plan does have to remain separate from the LIP. Receiving credit for IGTs put up for this, we may be able to keep that associated with Low Income Pool. Taking a direct link between the two is not allowable under the current authority. We would have to take the rate that was driven for the cost to exempt those counties and then we would have to gross up the amount of money it took to buy those back, and in addition to that the money that it took to fund any other county would far more exceed the volume of the days and the cost. Tom Wilfong stated that in order to bring in more federal dollars, one option is that AHCA could increase the rates of the plan to make sure to incorporate the amount of those IGTs they are putting up to make sure the plan will give back to the providers. Michele Morgan reiterated that the Agency will need to do more research on this. Michele Morgan noted the Federal CMS is looking for justification and historical spending. Historical spending in a fee for service or managed care environment is not going to support that level. To get those counties to put up the money for other counties and have a payback, The Agency needs to confirm the authority that is under LIP to see if that is possible because, not that it is impossible but unless there is something else not found previously, building a rate that will make up for that, CMS will not approve. Buybacks are assuming the rates get up to 100% or close to it; that s the amount of money that s funded and securing that money is not seen as a problem from the counties. If all those other criteria (getting their IGTs back or maintaining it in the county) is in consensus that by doing a distribution method, the direct benefit for the exemption

5 and the cost of the buyback will stay within those areas, it is how the IGT flows back or the benefit of putting up an IGT for someone else. This is the area that the Agency needs to fully research. Final spreadsheet changes: add letters and totals, the area and the county, add columns and better headings. Margaret Brennan stated that she has requested assistance from Heather Wildermuth with the Florida Association of Counties in obtaining feedback from counties. Ms Wildermuth will contact the counties directly to obtain their input. Feedback requested will include identification of potential concerns, comments and considerations on the TAP committee s discussion date. Feedback will also be solicited to determine if comments and concerns have changed from the previous meetings. Models: assume we will build in a certain kicker (15%); leave it up to the model requestor or designer whether or not they want to assume the IGT is paid back through outside or inside the capitation. General revenue will not be used. Margaret Brennan expressed concerns that it was mentioned during a presentation at the September 27 th IGT/TAP meeting that the counties were negatively impacted by the buyback. The presentation noted that the buyback increases the counties mandated inpatient rates for days eleven through forty five. We will discuss rate setting at the next meeting. Next meeting: We should have a draft of the narrative report that will have everything except for the actual details of the methodologies. We will work towards completing models. V. Closing Comments Upcoming meetings October 27, 2010 & November 16, 2010 VI. Adjournment Sarah Michele Morgan, October 27, 2010

IGT TAP Meeting 2727 Mahan Drive Conference Room A Tallahassee, FL August 23, :00 p.m. - 3:00 p.m.

IGT TAP Meeting 2727 Mahan Drive Conference Room A Tallahassee, FL August 23, :00 p.m. - 3:00 p.m. CHARLIE CRIST GOVERNOR Members Present 1. Mark T. Knight (phone) 2. David Verinder 3. Margret Brennan 4. Michael Good 5. Tom Wilfong 6. Terry Meek 7. Scott Davis 8. Mark T. Knight (phone) Members Absent