Iowa-2019-HF295-Introduced

H.F. 295 Section 1. DUALLY ELIGIBLE MEDICARE AND MEDICAID 1 BENEFICIARIES RECEIVING HOSPICE BENEFIT IN A NURSING FACILITY 2 —— ELIMINATION OF PASS-THROUGH PAYMENT. 3 1. The department of human services shall request federal 4 approval from the centers for Medicare and Medicaid services of 5 the United States department of health and human services for 6 a section 1115 demonstration waiver to allow for the payment 7 of the nursing facility room and board expenses for a dually 8 eligible Medicare and Medicaid member receiving the Medicare 9 hospice benefit, to allow Medicaid managed care organizations 10 and the Medicaid fee-for-service payment system to reimburse 11 the nursing facility directly for the room and board expenses 12 at ninety-five percent of the base rate rather than indirectly 13 as a pass-through payment from the hospice services provider. 14 The department of human services shall report receipt of 15 such approval to the chairpersons and ranking members of 16 the appropriations committees of the house and senate, the 17 co-chairpersons and ranking members of the joint appropriations 18 subcommittee on health and human services, and the legislative 19 services agency. 20 2. The department of human services shall adopt rules 21 pursuant to chapter 17A to administer this section and 22 specifically to allow Medicaid managed care organizations and 23 the department’s fee-for-service Medicaid payment system to 24 reimburse a nursing facility directly for the room and board 25 expenses at ninety-five percent of the base rate as provided in 26 this section. 27 EXPLANATION 28 The inclusion of this explanation does not constitute agreement with 29 the explanation’s substance by the members of the general assembly. 30 This bill requires the department of human services (DHS) 31 to request federal approval from the centers for Medicare and 32 Medicaid services of the United States department of health and 33 human services for a section 1115 demonstration waiver to allow 34 for the payment of the nursing facility room and board expenses 35 -1- LSB 2055YH (3) 88 pf/rh 1/ 3

H.F. 295 for a dually eligible Medicare and Medicaid member receiving 1 the Medicare hospice benefit, to allow Medicaid managed care 2 organizations (MCOs) and the Medicaid fee-for-service (FFS) 3 payment system to reimburse the nursing facility directly for 4 the room and board expenses at 95 percent of the base rate 5 rather than indirectly as a pass-through payment from the 6 hospice services provider. The bill requires DHS to report 7 receipt of such approval to the chairpersons and ranking 8 members of the appropriations committees of the house and 9 senate, the co-chairpersons and ranking members of the joint 10 appropriations subcommittee on health and human services, 11 and the legislative services agency. The bill requires DHS 12 to adopt administrative rules to administer the bill and 13 specifically to allow Medicaid MCOs and the department’s 14 FFS Medicaid payment system to reimburse a nursing facility 15 directly for the room and board expenses at 95 percent of the 16 base rate as provided in the bill. 17 Currently, the Medicare hospice benefit covers the costs of 18 palliative care for an individual who is terminally ill in the 19 individual’s home or in a nursing facility. Medicare does not 20 have a long-term custodial nursing facility benefit, so if an 21 individual elects the Medicare hospice benefit in a nursing 22 facility, the individual’s room and board are not covered by 23 Medicare and the individual or a third-party payor must pay for 24 the costs of the room and board. For those individuals dually 25 eligible for Medicare and Medicaid who elect the Medicare 26 hospice benefit, Medicare is financially responsible for the 27 hospice care and the Medicaid program is the third-party payor 28 responsible for the nursing facility room and board expense. 29 For the nursing facility room and board care, the Medicaid 30 program must provide for payment in an amount equal to at least 31 95 percent of the Medicaid daily nursing facility base rate 32 (the rate the state Medicaid program pays for nursing facility 33 services furnished to an individual who has not elected to 34 receive hospice care). Historically, the Medicaid program 35 -2- LSB 2055YH (3) 88 pf/rh 2/ 3

H.F. 295 has paid the hospice provider for the nursing facility room 1 and board expenses of dually eligible individuals who elect 2 the hospice benefit, and the hospice provider has then passed 3 this payment on to the nursing facility under a contract with 4 the nursing facility. Current practice is for most hospice 5 providers to pay 100 percent of the nursing facility base rate 6 to the nursing facility. 7 Pursuant to 2018 Iowa Acts, chapter 1038, DHS was directed to 8 review the hospice benefit for dually eligible individuals in 9 a nursing facility and report options for elimination of the 10 pass-through payments to the chairperson and ranking members 11 of the joint appropriations subcommittee on health and human 12 services, the legislative service agency, and the legislative 13 caucus staffs on or before October 1, 2018. DHS submitted the 14 report that included four options. The bill reflects option 15 1 of the report which is budget neutral and would require DHS 16 to request federal approval to allow Medicaid managed care 17 organizations and the Medicaid fee-for-service payment system 18 to pay the nursing facility directly for the nursing facility 19 room and board costs, and eliminate the pass-through payment 20 utilizing the hospice provider. 21 -3- LSB 2055YH (3) 88 pf/rh 3/ 3