MEMORANDUM

TO:	FHCA Members
FROM:	J. Emmett Reed, CAE, FHCA Executive Director
RE:	AHCA/DOEA Medicaid Settlement
DATE:	September 28, 2009

Last week, a number of newspaper articles www.theledger.com/article/20090919/NEWS/909199990?Title=Recipients-of-Medicaid-Settle-State-Lawsuit reported on a settlement agreement by the Agency for Health Care Administration and the Department of Elder Affairs regarding a lawsuit that would allow Medicaid nursing home residents to have greater ability for transition from nursing homes to community-based programs.

To better understand the settlement agreement and in anticipation of your questions, FHCA spoke with key staff in the impacted state agencies, including legal counsel for both AHCA and DOEA. All of our discussions indicate that this settlement will not impact your reimbursement rates to provide care and services to Medicaid residents.

On Friday, members of FHCA's Board of Directors, along with representatives from Our Florida Promise, met by conference call with DOEA's General Counsel to hear more explanation about the settlement, how the state intends to implement it and how this will impact nursing home care in the future.

Dean Kowalchyk, DOEA General Counsel, spoke on behalf of DOEA Secretary Doug Beach and reported that negotiations with plaintiffs and legislative action resulted in a settlement agreement which abates the lawsuit for one year.

During the 2009 special session and then again during the 2009 regular session, the Florida Legislature, by proviso, stated that AHCA could transfer funds from the nursing home line item to Home and Community-Based waivers (HCB) to assist people with transition. While funds may be transferred from the nursing home line item, it in no way impacts your reimbursement rate. When the provision was adopted, DOEA began a transition process and both agencies pursued a transition plan.

The agreement specifies a spending goal of $27 million for transition, which, under Medicaid services, must be used for direct care services. Existing HCB Waiver programs will not be modified, except to include case management services.

Administration of the plan will include advising every nursing home resident of the program and making brochures and posters available to facilities. It will not be a requirement for facilities to hang posters, but they will be made available.

Mr. Kowalchyk noted that approximately 8000 residents were identified through the MDS check-off as desiring to be transitioned. Under Medicaid services, DOEA is charged with ensuring the health, safety and welfare of each of these individuals and as a result it will be determined that some of these individuals will not be able to transition due to the level of skilled nursing care they need.

Prior to the meeting with Mr. Kowalchyk, Tony Marshall of our staff and FHCA's legal consultant, Karen Goldsmith, met with AHCA's General Counsel, Justin Senior, to gather more information on this issue. Mr. Senior's comments reflected that of Mr. Kowalchyk in that the agency will not allow people to transition into the community if they are not going to be safe. The great majority of individuals identified will naturally transition back into the community and therefore, the number of individuals able to transition under this new program will be less than that identified through the MDS. Mr. Senior noted as Mr. Kowalchyk did that he did not believe the settlement would have a financial impact on nursing homes.

If you wish to read a copy of the settlement agreement, click here. In the meantime, FHCA will continue to monitor this issue and provide relevant information to members as it becomes available.