TITLE 1.ADMINISTRATION

Part 12. COMMISSION ON STATE EMERGENCY COMMUNICATIONS

Chapter 251. REGIONAL PLANS--STANDARDS

1 TAC §251.2

The Commission on State Emergency Communications (CSEC) adopts an amendment to §251.2, concerning guidelines for changing or extending 9-1-1 service arrangements, without changes to the proposed text as published in the May 7, 2004, issue of the Texas Register (29 TexReg 4343).

This action is adopted as part of Rule Review of Chapter 251, pursuant to Government Code, Section 2001.039. The rule continues to be essential to the CSEC's operations and per statutory authority.

CSEC adopts the rule with amendments to this rule to streamline reporting requirements for the regional planning commissions (RPCs). The associated instructions for reporting are being proposed as a new proposed Program Policy Statement, a more formal version of the agency's former Program Policies and Procedures.

No comments were received regarding adoption of the amendment.

The amendment is adopted under Health and Safety Code, Chapter 771, §§771.051, 771.055, 771.056; and Title 1 Texas Administrative Code, Part 12, Chapter 251, Regional Plan Standards, which provide the Commission on State Emergency Communications with the authority to plan, develop, fund, and provide provisions for the enhancement of effective and efficient 9-1-1 service.

This agency hereby certifies that the adoption has been reviewed by legal counsel and found to be a valid exercise of the agency's legal authority.

Filed with the Office of the Secretary of State on June 28, 2004.

TRD-200404275

Paul Mallett

Executive Director

Commission on State Emergency Communications

Effective date: July 18, 2004

Proposal publication date: May 7, 2004

For further information, please call: (512) 305-6933


1 TAC §251.5

The Commission on State Emergency Communications (CSEC) adopts an amendment to §251.5, concerning the use of 9-1-1 funds for equipment management and disposition, without changes to the proposed text as published in the May 7, 2004, issue of the Texas Register (29 TexReg 4345).

This action is adopted as part of Rule Review of Chapter 251, pursuant to Government Code, Section 2001.039. The rule continues to be essential to the CSEC's operations and per statutory authority.

CSEC adopts the rule with amendments to ensure consistency with Texas Uniform Grant Management Standards (UGMS). Reporting forms attached to the previous version of this rule have been revised and are now included in a new proposed Program Policy Statement, a more formal version of the agency's former Program Policies and Procedures.

The following comments were received regarding adoption of the amendment.

Comments received from the Texas Association of Regional Councils' (TARC) 9-1-1 Coordinators' Committee to 251.5 related to the required annual certification of assets and notices of equipment disposal are being addressed in the proposed PPS-014, Asset Inventory Reporting , which will be presented for Commission action at the July 15th meeting.

The amendment is adopted under Health and Safety Code, Chapter 771, §§771.051, 771.055, 771.056, 771.071, 771.0711, 771.072, 771.075, 771.078, 771.079; and Title 1 Texas Administrative Code, Part 12, Chapter 251, Regional Plan Standards, which provide the Commission on State Emergency Communications with the authority to plan, develop, fund, and provide provisions for the enhancement of effective and efficient 9-1-1 service.

This agency hereby certifies that the adoption has been reviewed by legal counsel and found to be a valid exercise of the agency's legal authority.

Filed with the Office of the Secretary of State on June 28, 2004.

TRD-200404276

Paul Mallett

Executive Director

Commission on State Emergency Communications

Effective date: July 18, 2004

Proposal publication date: May 7, 2004

For further information, please call: (512) 305-6933


1 TAC §251.7

The Commission on State Emergency Communications (CSEC) adopts an amendment to §251.7, concerning the inclusion of third-party software applications into the 9-1-1 integrated workstation environment, without changes to the proposed text as published in the May 7, 2004, issue of the Texas Register (29 TexReg 4353).

This action is adopted as part of Rule Review of Chapter 251, pursuant to Government Code, Section 2001.039. The rule continues to be essential to the CSEC's operations and per statutory authority.

CSEC adopts the rule with substantive revision to the rule to add a requirement that mapping of telephone number (TN) data is tested for accuracy prior to "going live" with Mapped ALI at a PSAP.

The following comments were received regarding adoption of the amendment.

Comments received from the Texas Association of Regional Councils' (TARC) 9-1-1 Coordinators' Committee to 251.7, Guidelines for Implementing Integrated Services related to documentation of testing for integrated services, are being addressed in the proposed PPS-015, 9-1-1 System Survey, which will be presented for Commission action at the July 15th meeting.

The amendment is adopted under Health and Safety Code, Chapter 771, §§771.051, 771.055 and 771.056; and Title 1 Texas Administrative Code, Part 12, Chapter 251, Regional Plan Standards, which provide the Commission on State Emergency Communications with the authority to plan, develop, fund, and provide provisions for the enhancement of effective and efficient 9-1-1 service.

This agency hereby certifies that the adoption has been reviewed by legal counsel and found to be a valid exercise of the agency's legal authority.

Filed with the Office of the Secretary of State on June 28, 2004.

TRD-200404277

Paul Mallett

Executive Director

Commission on State Emergency Communications

Effective date: July 18, 2004

Proposal publication date: May 7, 2004

For further information, please call: (512) 305-6933


1 TAC §251.8

The Commission on State Emergency Communications (CSEC) adopts an amendment §251.8, concerning proposed guidelines for the procurement of equipment services with 9-1-1 funds, without changes to the proposed text as published in the May 7, 2004, issue of the Texas Register (29 TexReg 4355).

This action is adopted as part of Rule Review of Chapter 251, pursuant to Government Code, Section 2001.039. The rule continues to be essential to the CSEC's operations and per statutory authority.

CSEC adopts the rule with amendments made to ensure consistency with Texas Uniform Grant Management Standards (UGMS).

No comments were received regarding adoption of the amendment.

The amendment is adopted under Health and Safety Code, Chapter 771, §§771.051, 771.071, 771.0711, 771.072, 771.075; and Title 1 Texas Administrative Code, Part 12, Chapter 251, Regional Plan Standards, which provide the Commission on State Emergency Communications with the authority to plan, develop, fund, and provide provisions for the enhancement of effective and efficient 9-1-1 service.

This agency hereby certifies that the adoption has been reviewed by legal counsel and found to be a valid exercise of the agency's legal authority.

Filed with the Office of the Secretary of State on June 28, 2004.

TRD-200404278

Paul Mallett

Executive Director

Commission on State Emergency Communications

Effective date: July 18, 2004

Proposal publication date: May 7, 2004

For further information, please call: (512) 305-6933


Part 15. TEXAS HEALTH AND HUMAN SERVICES COMMISSION

Chapter 355. MEDICAID REIMBURSEMENT RATES

Subchapter A. COST DETERMINATION PROCESS

1 TAC §355.112

The Texas Health and Human Services Commission (HHSC) adopts an amendment to §355.112, with changes to the proposed text published in the April 30, 2004, issue of the Texas Register (29 TexReg 4037).

The primary purpose of the amendment was to expand the definition of an attendant in the Residential Care (RC) and Community Based Alternatives Assisted Living/Residential Care (CBA AL/RC) programs to include drivers as attendants. This amended definition accurately reflects the fact that attendants also function as drivers in the majority of RC and CBA AL/RC facilities. While serving as drivers, attendants provide assistance with activities of daily living such as doctor and hospital visits, shopping, and outdoor activities. The amendment also corrected references to the CBA AL/RC Program so they are consistent throughout the rule.

HHSC received no comments regarding adoption of the amendment.

HHSC, however, has initiated a minor editorial change to the text of §355.112(b)(4) to clarify and improve the accuracy of the section.

The amendment is adopted under the Government Code, §531.033, which authorizes the commissioner of HHSC to adopt rules necessary to carry out the commission's duties, and §531.021(b), which establishes HHSC as the agency responsible for adopting reasonable rules governing the determination of fees, charges, and rates for medical assistance payments under Human Resources Code, Chapter 32.

The amendment affects the Government Code, §§531.033 and 531.021(b).

§355.112.Attendant Compensation Rate Enhancement.

(a) Eligible programs. Providers contracted in the Primary Home Care, including Family Care (PHC/FC); Day Activity and Health Services (DAHS); Residential Care (RC); Community Living Assistance and Support Services (CLASS)--Direct Service Agency; Community Based Alternatives (CBA)--Home and Community Support Services (HCSS); Deaf-Blind Multiple Disabilities Waiver (DBMD); and CBA--Assisted Living/Residential Care (AL/RC) programs, are eligible to participate in the attendant compensation rate enhancement.

(b) Definition of attendant. An attendant is the unlicensed caregiver providing direct assistance to the clients with Activities of Daily Living (ADL) and Instrumental Activities of Daily Living (IADL).

(1) In the case of DAHS, RC, and CBA AL/RC programs, the attendant may perform some nonattendant functions. In such cases, the attendant must perform attendant functions at least 80% of his or her total time worked. Staff in these settings not providing attendant services at least 80% of their total time worked are not considered attendants. Time studies must be performed in accordance with §355.105(b)(2)(B)(i) for staff in the DAHS, RC, and CBA AL/RC programs that are not full-time attendants but perform attendant functions to determine if a staff member meets this 80% requirement. Failure to perform the time studies for these staff will result in the staff not being considered to be attendants.

(2) Attendants do not include the director, administrator, assistant director, assistant administrator, clerical and secretarial staff, professional staff, other administrative staff, licensed staff, attendant supervisors, cooks and kitchen staff, maintenance and groundskeeping staff, activity director, and laundry and housekeeping staff. In the case of PHC/FC, CLASS, CBA HCSS, and DBMD staff other than attendants may deliver attendant services and be considered an attendant if they must perform attendant services that cannot be delivered by another attendant to prevent a break in service.

(3) An attendant also includes a driver in the DAHS, RC, and CBA AL/RC programs.

(4) An attendant also includes medication aides in the RC and CBA AL/RC programs.

(c) Attendant compensation cost center. This cost center will include employee compensation, contract labor costs, and personal vehicle mileage reimbursement for attendants as defined in subsection (b) of this section.

(1) Attendant compensation is the allowable compensation for attendants defined in §355.103(b)(1) of this title (relating to Specifications for Allowable and Unallowable Costs) and required to be reported as either salaries and/or wages, including payroll taxes and workers' compensation, or employee benefits. Benefits required by §355.103(b)(1)(A)(iii) of this title (relating to Specifications for Allowable and Unallowable Costs) to be reported as costs applicable to specific cost report line items, except as noted in paragraph (3) of this subsection, are not to be included in this cost center.

(2) Contract labor refers to personnel for whom the contracted provider is not responsible for the payment of payroll taxes, such as FICA, Medicare, and federal and state unemployment insurance, and who perform tasks routinely performed by employees where allowed by program rules. Allowable contract labor costs are defined in §355.103(b)(2)(C) of this title (relating to Specifications for Allowable and Unallowable Costs).

(3) Mileage reimbursement paid to the attendant for the use of his or her personal vehicle and which is not subject to payroll taxes is considered compensation for this cost center.

(d) Rate year. The rate year begins on the first day of September and ends on the last day of August of the following year.

(e) Open enrollment. Open enrollment begins on the first day of July and ends on the last day of that same July preceding the rate year for which payments are being determined, unless the Texas Health and Human Services Commission (HHSC) notified providers before the first day of July that open enrollment has been postponed or cancelled. Should conditions warrant, HHSC may conduct additional enrollment periods during a rate year.

(f) Enrollment contract amendment. An initial enrollment contract amendment is required from each provider choosing to participate in the attendant compensation rate enhancement. On the initial enrollment contract amendment, the provider must specify for each contract a desire to participate or not to participate. The participating provider must specify for each program the desire to have all participating contracts be considered as a group or as individuals for purposes related to the attendant compensation rate enhancement. For the PHC/FC program, the participating provider must also specify if he wishes to have either priority 1, nonpriority, or both priority 1 and nonpriority services participating in the attendant compensation rate enhancement. If the PHC/FC provider selects to have their contracts participating as a group, then the provider must select to have either priority 1, nonpriority, or both priority 1 and nonpriority services participate for the entire group of contracts. For providers delivering services to both RC and CBA AL/RC clients in the same facility, participation includes both the RC and CBA AL/RC programs. After initial enrollment, participating and nonparticipating providers may request to modify their enrollment status during any open enrollment period. A nonparticipant can request to become a participant; a participant can request to become a nonparticipant; a participant can request to change its participation level; a provider whose participating contracts are being considered as a group can request to have them considered as individuals; and a provider whose participating contracts are being considered as individuals can request to have them considered as a group. Requests to modify a provider's enrollment status during an open enrollment period must be received by HHSC Rate Analysis by the last day of the open enrollment period as per subsection (e) of this section. If the last day of open enrollment is on a weekend day, state holiday, or national holiday, the next business day will be considered the last day requests will be accepted. Providers from which HHSC Rate Analysis has not received an acceptable request to modify their enrollment by the last day of the open enrollment period will continue at the level of participation and group or individual status in effect during the open enrollment period within available funds. To be acceptable, an enrollment contract amendment must be completed according to instructions, signed by an authorized signatory as per the Texas Department of Human Services (DHS) Corporate Board of Directors Resolution applicable to the provider's contract or ownership type, and legible.

(g) New contracts. For the purposes of this section, for each rate year a new contract is defined as a contract delivering its first day of service to a DHS client on or after the first day of the open enrollment period, as defined in subsection (e) of this section, for that rate year. Contracts that underwent a contract assignment are not considered new contracts. For purposes of this subsection, an acceptable contract amendment is defined as a legible enrollment contract amendment that has been completed according to instructions, signed by an authorized signator as per the DHS Corporate Board of Directors Resolution applicable to the provider's contract or ownership type, and received by HHSC Rate Analysis within 30 days of the date of notification to the provider that such an enrollment contract amendment must be submitted. If the 30th day is on a weekend day, state holiday, or national holiday, the next business day will be considered the last day requests will be accepted. The granting of newly requested rate enhancement increments as outlined in subsection (p) of this section is limited to available funds. New contracts will receive the nonparticipant attendant compensation rate as specified in subsection (m) until:

(1) for new contractors specifying the desire not to participate on an acceptable enrollment contract amendment, the attendant compensation rate component is as specified in subsection (m) of this section.

(2) for new contractors specifying the desire to participate on an acceptable enrollment contract amendment, the attendant compensation rate component is adjusted as specified in subsections (l) and (n) of this section retroactive to the first day of their contract.

(3) for new contracts from which an acceptable enrollment contract amendment is not received, the attendant compensation rate component is as specified in subsection (m) of this section.

(h) Attendant Compensation Report submittal requirements. Attendant Compensation Reports must be submitted by participating contracted providers as follows.

(1) Contracted providers participating for the full rate year. Contracted providers participating for the full rate year must provide annual Attendant Compensation Reports as follows:

(A) Participating contracted providers will provide HHSC Rate Analysis, in a method specified by HHSC Rate Analysis, an annual Attendant Compensation Report reflecting the activities of the provider while delivering contracted services from the first day of the rate year through the last day of the rate year. This report must be submitted for each participating contract if the provider requested participation individually for each contract; or, if the provider requested participation as a group, the report must be submitted as a single aggregate report covering all contracts participating at the end of the rate year within one program of the provider. A participating contract that has been terminated in accordance with subsection (v) of this section or that has undergone a contract assignment in accordance with subsection (w) of this section will be considered to have participated on an individual basis for compliance with reporting requirements for the owner prior to the termination or contract assignment. This report will be used as the basis for determining compliance with the spending requirements and recoupment amounts as described in subsection (s) of this section. Contracted providers failing to submit an acceptable annual Attendant Compensation Report within 60 days of the end of the rate year will be placed on vendor hold until such time as an acceptable report is received and processed by HHSC Rate Analysis.

(B) Contracts whose cost report year, as defined in §355.105(b)(5) of this title (relating to General Reporting and Documentation Requirements, Methods and Procedures), coincides with the state of Texas fiscal year, are exempt from the requirement to submit a separate annual Attendant Compensation Report. For these contracts, their cost report will be considered their annual Attendant Compensation Report.

(2) Contracted providers participating for less than a full year. Contracted providers participating for less than a full year must provide Attendant Compensation Reports as follows:

(A) A participating provider whose contract is terminated either voluntarily or involuntarily before the end of the rate year must submit an Attendant Compensation Report covering the period from the beginning of the rate year to the date recognized by DHS as the contract termination date. This report will be used as the basis for determining recoupment as described in subsection (s) of this section.

(B) In cases where a participating provider changes ownership through a contract assignment, the owner prior to the change of ownership must submit an Attendant Compensation Report, covering the period from the beginning of the rate year to the effective date of the contract assignment as determined by DHS. The owner, after the change of ownership, must submit an Attendant Compensation Report within 60 days of the end of the rate year, covering the period from the effective date of the contract assignment as determined by DHS to the end of the rate year. This report will be used as the basis for determining recoupment as described in subsection (s) of this section.

(C) A participating provider who is excluded from participation as per subsection (u) of this section must submit an Attendant Compensation Report within 60 days from the date of notification of the exclusion, covering the period from the beginning of the rate year to the date of exclusion as determined by HHSC Rate Analysis. This report will be used as the basis for determining recoupment as described in subsection (s) of this section.

(D) A participating provider who voluntarily withdraws from participation as per subsection (x) of this section must submit an Attendant Compensation Report within 60 days from the date of withdrawal as determined by HHSC, covering the period from the beginning of the rate year through the date of withdrawal as determined by HHSC. This report will be used as the basis for determining recoupment as described in subsection (s) of this section.

(E) A participating provider who is a new contractor as per subsection (g) of this section must submit an Attendant Compensation Report within 60 days of the end of the rate year, covering the period from the first day of the contract as determined by DHS through the end of the rate year. This report will be used as the basis for determining recoupment as described in subsection (s) of this section.

(3) Other reports. HHSC may require other reports from all contracts as needed.

(4) Vendor hold. HHSC will place on hold the vendor payments for any contractor who does not submit an Attendant Compensation Report completed in accordance with all applicable rules and instructions by the due dates described in this subsection. This vendor hold will remain in effect until HHSC Rate Analysis receives an acceptable Attendant Compensation Report.

(A) Contractors participating at the end of the rate year who do not submit an Attendant Compensation Report in accordance with paragraphs (1), (2)(B), and (2)(E) of this subsection, completed in accordance with all applicable rules and instructions, within 60 days of the vendor hold being placed will become a nonparticipant retroactive to the first day of the reporting period until the first day of the month after all of the following conditions are met:

(i) the provider submits an acceptable annual Attendant Compensation Report;

(ii) the provider submits a separate Attendant Compensation Report from the beginning of the current rate year to the date they were disenrolled as a participant;

(iii) the provider repays to DHS funds that are identified for recoupment from subsection (s) of this section; and

(iv) HHSC Rate Analysis receives, in writing by certified mail, a request from the provider to be restored to the participant status.

(B) Contractors not participating at the end of the rate year who do not submit an Attendant Compensation Report in accordance with paragraph (2)(A) - (D) of this subsection, completed in accordance with all applicable rules and instructions, within 60 days of the vendor hold being placed will become nonparticipants from the beginning of the rate year to the date of ownership change, exclusion, or withdrawal.

(i) Attendant Compensation Report contents. Each Attendant Compensation Report will include any information required by HHSC to implement this attendant compensation rate enhancement.

(j) Completion of compensation reports. All Attendant Compensation Reports must be completed in accordance with the provisions of §§355.102 - 355.105 of this title (relating to General Principles of Allowable and Unallowable Costs, Specifications for Allowable and Unallowable Costs, Revenues, and General Reporting and Documentation Requirements, Methods, and Procedures) and may be reviewed or audited in accordance with §355.106 of this title (relating to Basic Objectives and Criteria for Audit and Desk Review of Cost Reports). Beginning with the rate year that starts September 1, 2002, all Attendant Compensation Reports must be completed by preparers who have attended the required cost report training for the applicable program under §355.102(d) of this title (relating to General Principles of Allowable and Unallowable Costs).

(k) Enrollment. Providers choosing to participate in the attendant compensation rate enhancement must submit to HHSC a signed enrollment contract amendment as described in subsection (f) of this section. Participation is determined separately for each program specified in subsection (a) of this section, except that for providers delivering services to both RC and CBA AL/RC clients in the same facility, participation includes both the RC and CBA AL/RC programs. For PHC/FC, participation is also determined separately for priority 1 and nonpriority services. Participation will remain in effect, subject to availability of funds, until the provider notifies HHSC, in accordance with subsection (x) of this section, that it no longer wishes to participate or until HHSC excludes the contract from participation for reasons outlined in subsection (u) of this section. Contracts voluntarily withdrawing from participation will have their participation end effective with the date of withdrawal as determined by HHSC. Contracts excluded from participation will have their participation end effective on the date determined by HHSC.

(l) Determination of attendant compensation rate component for participating contracts. For each of the programs identified in subsection (a) of this section, an attendant compensation rate component will be determined for participating contracts from subsection (k) of this section. The attendant compensation rate enhancement component will be determined by taking into consideration quality of care, labor market conditions, economic factors, and budget constraints. The attendant compensation rate enhancement component will be determined on a per-unit-of-service basis applicable to each program or service.

(m) Determination of attendant compensation rate component for nonparticipating contracts. For each of the programs identified in subsection (a) of this section, HHSC will calculate an attendant compensation rate component for nonparticipating contracts as follows.

(1) Determine for each contract included in the cost report data base used in determination of rates in effect on September 1, 1999, the attendant compensation cost center from subsection (c) of this section.

(2) Adjust the cost center data from paragraph (1) of this subsection in order to account for inflation utilizing the inflation factors used in the determination of the September 1, 1999 rates.

(3) For each contract included in the cost report database used to determine rates in effect on September 1, 1999, divide the result from paragraph (2) of this subsection by the corresponding units of service. Provider projected costs per unit of service are rank-ordered from low to high, along with the provider's corresponding units of service. For DAHS, the median cost per unit of service is selected. For all other programs, the units of service are summed until the median unit of service is reached. The corresponding projected cost per unit of service is the weighted median cost component. The result is multiplied by 1.044 for all programs in subsection (a) of this section except for RC and CBA AL/RC, which is multiplied by 1.07. The result is the attendant compensation rate component for nonparticipating contracts.

(4) The attendant compensation rate component will remain constant over time, except for adjustments necessitated by increases in the minimum wage. In such cases, adjustments to the nonparticipating rates are limited to ensuring that these rates are adequate to cover mandated minimum wage levels.

(n) Determination of attendant compensation rate enhancements. HHSC will determine attendant compensation rate enhancement increments associated with each enhanced attendant compensation level. The attendant compensation rate enhancement increments will be determined by using data from sources such as cost reports, surveys, and/or other relevant sources. The attendant compensation rate enhancement increments will be determined by taking into consideration quality of care, labor market conditions, economic factors, and budget constraints. The attendant compensation rate enhancement increments will be determined on a per-unit-of-service basis applicable to each program or service.

(o) Enhanced attendant compensation. Participating contracts desiring to provide attendant compensation above the level included in subsection (l) of this section may request attendant compensation increments from an array of enhanced attendant compensation options and associated add-on payments determined in subsection (n) of this section during open enrollment. Participating providers who select to have all of their contracts participate in a program as a group must request a single attendant compensation increment for the entire group of contracts. PHC/FC providers participating as a group must select a single attendant compensation increment for their entire group of contracts for the priority 1 and/or nonpriority services they have selected for participation.

(p) Granting additional attendant compensation rate enhancement increments. HHSC divides all requests for attendant compensation rate enhancement increments into two groups: pre- existing rate enhancement increments which providers requested to carry over from the prior year and newly requested rate enhancement increments. Newly requested rate enhancement increments may be requested by providers who were nonparticipants in the prior year, by providers who were participants during the prior year desiring to be granted additional rate enhancement increments or by new contracts as described in subsection (g) of this section. Using the process described herein, HHSC first determines the distribution of carry-over rate enhancement increments. If funds are available after the distribution of carry-over rate enhancement increments, HHSC determines the distribution of newly requested rate enhancement increments as follows:

(1) HHSC determines projected units of service for contracts requesting each enhancement increment and multiplies this number by the enhancement rate add-on amount associated with that enhancement increment as determined in subsection (n) of this section.

(2) HHSC compares the sum of the products from paragraph (1) of this subsection to available funds.

(A) If the product is less than or equal to available funds, all requested enhancements are granted.

(B) If the product is greater than available funds, enhancements are granted beginning with the lowest level of enhancement and granting each successive level of enhancement until requested enhancements are granted within available funds. Based upon an examination of existing compensation levels and compensation needs, HHSC may grant certain enhancement options priority for distribution.

(q) Notification of granting of enhancements. Participating contracts are notified, in a manner determined by HHSC, as to the disposition of their request for additional attendant compensation rate enhancement increments.

(r) Total attendant compensation rate for participating contracts. Each participating contract will receive an attendant compensation rate equal to the attendant compensation rate component for participating contracts from subsection (l) of this section, plus any additional attendant compensation rate enhancement payments granted to the contract.

(s) Spending requirements for participating contracts. HHSC will determine from the Attendant Compensation Report, as specified in subsection (h) of this section and other appropriate data sources, the amount of attendant compensation spending per unit of service delivered. The provider's compliance with the spending requirement is determined based on the total attendant compensation spending as reported on the Attendant Compensation Report for each participating contract if the provider requested participation individually for each contract. A participating contract that has been terminated in accordance with subsection (v) of this section or that has undergone a contract assignment in accordance with subsection (w) of this section will be considered to have participated on an individual basis for compliance with the spending requirement for the owner prior to the termination or contract assignment. If the provider specified that he wished to have all participating contracts be considered as a group for purposes related to the attendant compensation rate enhancement, as specified in subsection (f) of this section, compliance with the spending requirement is based on the total attendant compensation as reported on the single aggregate Attendant Compensation Report described in subsection (h) of this section. Compliance with the spending requirement is determined separately for each program specified in subsection (a) of this section, except for providers delivering services to both RC and CBA AL/RC clients in the same facility whose compliance is determined by combining both programs. HHSC will calculate recoupment, if any, as follows.

(1) For the rate year beginning September 1, 2000, the attendant compensation spending per unit of service is multiplied by 1.09 to determine the adjusted attendant compensation per unit of service. For the rate years beginning September 1, 2001, and September 1, 2002, the attendant compensation spending per unit of service is multiplied by 1.07 to determine the adjusted attendant compensation per unit of service. For the rate year beginning September 1, 2003, and thereafter, the attendant compensation spending per unit of service is multiplied by 1.10 to determine the adjusted attendant compensation per unit of service.

(2) The adjusted attendant compensation per unit of service from paragraph (1) of this subsection will be subtracted from the accrued attendant compensation revenue to determine the amount to be recouped. If the adjusted attendant compensation per unit of service is greater than or equal to the accrued attendant compensation revenue per unit of service, there is no recoupment.

(3) The amount paid for attendant compensation per unit of service after adjustments for recoupment must not be less than the amount determined in subsection (m) of this section.

(t) Notification of recoupment. Providers will be notified in a manner specified by HHSC of the amount to be repaid to DHS. If a subsequent review or audit results in audit adjustments to the annual Attendant Compensation Report that changes the amount to be repaid, the provider will be notified in writing of the adjustments and the adjusted amount to be repaid to DHS. DHS will recoup any amount owed from a provider's vendor payment(s) following the date of the notification letter.

(u) Exclusion from participation. Effective with the rate year that begins September 1, 2002, if the Attendant Compensation Report described in subsection (h) of this section indicates that the participating provider did not meet their spending requirement as determined from subsection (s) of this section, HHSC will notify the provider of the noncompliance. If the subsequent compensation report from subsection (h) of this section indicates that the provider has not met their spending requirement, the contract will be excluded from participation in the attendant rate enhancement effective immediately upon notice of failure to meet the spending requirement. The contract will be excluded from participation in the attendant compensation rate enhancement and will remain a nonparticipant for the remainder of the rate year in which the determination was made plus an additional rate year. Providers whose contracts are participating as a group must meet the requirements of this subsection as a group or all the contracts of the group will be excluded.

(v) Contract terminations. For terminating participants, HHSC will place a vendor hold on the payments of the contracted provider until HHSC receives an acceptable Attendant Compensation Report, as specified in subsection (h)(2)(A) of this section, and funds identified for recoupment from subsection (s) of this section are repaid to DHS. DHS will recoup any amount owed from the provider's vendor payments that are being held. In cases where funds identified for recoupment cannot be repaid by the terminating provider's last vendor payment, the responsible entity from subsection (cc) of this section will be jointly and severally liable for any additional payment due to DHS. Failure to repay the amount due or submit an acceptable payment plan within 60 days of notification will result in placement of a vendor hold on all DHS contracts controlled by the responsible entity and will bar the responsible entity from enacting new contracts with DHS until repayment is made in full.

(w) Contract assignments. The following applies to contract assignments.

(1) Contracts participating under the prior legal entity will continue participation under the legal entity accepting the contract assignment. When the provider or legal entity accepting the contract assignment has their contracts participating as individuals, participation in the attendant compensation rate enhancement confers to the provider or legal entity accepting the contract assignment. When the provider or legal entity accepting the contract assignment has their contracts participating as a group, the contract will participate with the group of the legal entity accepting the contract assignment for purposes related to the attendant compensation rate enhancement. When the provider or legal entity accepting the contract assignment has no contracts participating, the individual or group status of participating contracts under the old owner will transfer to the new owner. When the provider or legal entity accepting the contract assignment has its contracts participating as individuals or has no contracts participating, the provider or legal entity may submit an enrollment contract amendment to modify the enrollment of the assigned contract. To be acceptable, an enrollment contract amendment must be completed according to instructions, signed by an authorized signatory as per the DHS Corporate Board of Directors Resolution applicable to the provider's contract or ownership type, and be legible.

(2) When the contract assignment is an ownership change from one legal entity to a different legal entity, HHSC will place a vendor hold on the payments of the existing contracted provider until HHSC receives an acceptable Attendant Compensation Report specified in subsection (h)(2)(B) of this section and until funds identified for recoupment from subsection (s) of this section are repaid to DHS. DHS will recoup any amount owed from the provider's vendor payments that are being held. In cases where funds identified for recoupment cannot be repaid by the existing contracted provider's vendor payments that are being held, the responsible entity from subsection (cc) of this section will be jointly and severally liable for any additional payment due to DHS. Failure to repay the amount due within 60 days of notification will result in placement of a vendor hold on all DHS contracts controlled by the responsible entity and will bar the responsible entity from enacting new contracts with DHS until repayment is made in full.

(x) Voluntary withdrawal. Participating contracts wishing to withdraw from the attendant compensation rate enhancement must notify HHSC Rate Analysis in writing by certified mail. The requests will be effective the first of the month following the receipt of the request. Contracts voluntarily withdrawing must remain nonparticipants for the remainder of the rate year. Providers whose contracts are participating as a group must request withdrawal of all the contracts in the group.

(y) Adjusting attendant compensation requirements. Providers that determine that they will not be able to meet their attendant compensation requirements may request to reduce their attendant compensation requirements and associated enhancement payment to a lower participation level by submitting a written request to HHSC Rate Analysis by certified mail. These requests will be effective the first of the month following the receipt of the request. Providers whose contracts are participating as a group must request the same reduction for all of the contracts in the group.

(z) All other rate components. All other rate components will continue to be calculated as specified in the program-specific reimbursement methodology and will be uniform for all providers.

(aa) Failure to document spending. Undocumented attendant compensation expenses will be disallowed and will not be used in the determination of the attendant compensation spending per unit of service in subsection (s) of this section.

(bb) Appeals. Subject matter of informal reviews and formal appeals is limited as per §355.110 of this title (relating to Informal Reviews and Formal Appeals).

(cc) Responsible entities. The contracted provider, owner, or legal entity which received the attendant compensation rate enhancement is responsible for the repayment of the recoupment amount.

(dd) Reinvestment. HHSC will reinvest recouped funds in the attendant compensation rate enhancement to the extent there are qualifying contracts.

(1) Identify qualifying contracts. Contracts that meet the following criteria during the most recently completed reporting period are qualifying contracts for reinvestment purposes.

(A) The contract was a participant in the attendant compensation rate enhancement.

(B) The contract's attendant compensation spending per unit of service was greater than the total attendant compensation rate per unit of service granted to the contract.

(C) HHSC Rate Analysis has received an acceptable Attendant Compensation Report completed in accordance with all applicable rules and instructions.

(2) Distribution of available reinvestment funds. Available funds are distributed as follows:

(A) HHSC determines units of service provided during the most recently completed reporting period by each qualifying contract and multiplies this number by the attendant compensation spending per unit of service minus the attendant compensation rate per unit of service for the reporting period.

(B) HHSC compares the sum of the products from subparagraph (A) of this paragraph to funds available for reinvestment.

(i) If the product is less than or equal to available funds, all enhancements for qualifying contracts are retroactively awarded for the reporting period.

(ii) If the product is greater than available funds, retroactive enhancements are granted beginning with the lowest level of enhancement and granting each successive level of enhancement until enhancements are granted within available funds.

(3) Non-qualification as pre-existing enhancements. Retroactively awarded enhancements do not qualify as pre-existing enhancements for enrollment purposes.

(4) Notification of reinvested enhancements. Qualifying facilities are notified of the award of reinvested enhancements in a manner determined by HHSC.

This agency hereby certifies that the adoption has been reviewed by legal counsel and found to be a valid exercise of the agency's legal authority.

Filed with the Office of the Secretary of State on June 24, 2004.

TRD-200404224

Steve Aragón

General Counsel

Texas Health and Human Services Commission

Effective date: July 14, 2004

Proposal publication date: April 30, 2004

For further information, please call: (512) 438-3734


Subchapter J. PURCHASED HEALTH SERVICES

4. MEDICAID HOSPITAL SERVICES

1 TAC §355.8069

The Health and Human Services Commission (HHSC) adopts the amendment to §355.8069, concerning the reimbursement methodology for supplemental payments to certain rural public hospitals. The amendment is adopted without change to the proposed text published in the January 30, 2004, issue of the Texas Register (29 TexReg 740).

The amendment to §355.8069 eliminates the aggregate limit on supplemental inpatient payments to non-state government-owned or operated rural public hospitals. The amendment will result in additional reimbursement to certain rural public hospitals, which will help maintain access to medically necessary services in rural counties.

During the public comment period, which included a public hearing on February 19, 2004, HHSC received comments from the Texas Organization of Rural and Community Hospitals and several health care providers.

The following comments were received during the comment period.

Comment: Concerning the rule in general, the comments received expressed support for the proposed amendment.

Response: HHSC acknowledges the comments and agrees with the commenters. No changes were made to the rule in response to these comments.

The amendment is adopted under the Texas Government Code, §531.033, which provides the commissioner of HHSC with broad rulemaking authority; the Human Resources Code, §32.021, and the Texas Government Code, §531.021(a), which provide HHSC with the authority to administer the federal medical assistance (Medicaid) program in Texas; and the Texas Government Code, §531.021(b), which provides HHSC with the authority to propose and adopt rules governing the determination of Medicaid reimbursements.

This agency hereby certifies that the adoption has been reviewed by legal counsel and found to be a valid exercise of the agency's legal authority.

Filed with the Office of the Secretary of State on June 22, 2004.

TRD-200404169

Steve Aragón

General Counsel

Texas Health and Human Services Commission

Effective date: July 12, 2004

Proposal publication date: January 30, 2004

For further information, please call: (512) 424-6576