Section 7 AAC 145.700 - Health clinic payment rates(a) Except for services listed in (e) of this section, and as otherwise provided in (I) of this section, the department will determine a rural health clinic's payment rate or a federally qualified health center's payment rate based on the health clinic's reasonable costs. Reasonable costs must be determined by using the same methodology used under 42 U.S.C. 1395I(a)(3) and 42 C.F.R. 413.1 - 413.157. Costs must be related to furnishing medically necessary and appropriate services to Medicaid-eligible patients in accordance with 7 AAC 140.215. Costs may not include the cost of providing prescription drugs. The department will consider only costs that are related to providing Medicaid-eligible services to Medicaid-eligible patients, and will exclude other costs. A health clinic may receive payment only for services provided to a patient of the clinic by an employee or a contract worker of the clinic. The department's payment for services provided by the health clinic will be paid to the health clinic.(b) Unless the department and a health clinic make an agreement for the department to pay the clinic at the rates calculated under (g) of this section, the department will pay the clinic in accordance with 42 U.S.C. 1396a(bb)(1) - (5), adopted by reference in 7 AAC 160.900. For state fiscal year 2018, the department will not adjust for inflation, the payment rate under this subsection.(c) If, consistent with the alternative payment methodology provisions of 42 U.S.C. 1396 a(bb)(6), adopted by reference in 7 AAC 160.900, the department and a health clinic make an agreement for the department to pay the clinic at the rate calculated under this subsection, the department will calculate a prospective payment rate as follows: (1) base rates will be calculated prospectively, (A) in an amount calculated on a per-visit basis and equal to 100 percent of the inflated average of the allowable costs (i) of the health clinic of furnishing services during the health clinic's fiscal years 1999 and 2000; and(ii) that are reasonable and related to the cost of furnishing those services; and(B) in accordance with the following formula: (i) the clinic's total allowable and reasonable cost of providing primary care and ambulatory services for fiscal year 1999 will be inflated by the number set out in the first quarter 1999 publication of DRI-WEFA's Healthcare Cost Review, Skilled Nursing Facility Total Market Basket, inflated to 2001;(ii) the clinic's total allowable and reasonable cost of providing primary care and ambulatory services for fiscal year 2000 will be inflated by the number set out in the first quarter 2000 publication of DRI-WEFA's Healthcare Cost Review, Skilled Nursing Facility Total Market Basket, inflated to 2001;(iii) to obtain the base per-visit rate, the sum of the numbers calculated in (i) and (ii) of this subparagraph will be divided by the total number of visits as calculated under 7 AAC 145.710;(iv) the base per visit rate obtained under (iii) of this subparagraph will be adjusted to take into account any increase or decrease in the scope of services during fiscal year 2001 that the department has approved under (f) of this section;(2) beginning with the health clinic fiscal year 2003, and for each health clinic fiscal year that follows, the payment rate as calculated in (1) of this subsection will be (A) increased in that fiscal year by using the first quarter publication of Global Insight's Health care Cost Review, Skilled Nursing Facility Total Market Basket for yearly adjustment factors applied to health clinics; and for state fiscal year 2018, the department will not adjust for inflation the payment rate under this subparagraph; and(B) adjusted for that fiscal year to take into account any change in the scope of services that the department has approved under (f) of this section, whether the change in the scope of services is proposed for that fiscal year or occurred in the preceding fiscal year;(3) the payment rate calculated under this subsection must result in a payment to the health clinic that is equal to or greater than the amount required to be paid to the clinic under 42 U.S.C. 1396 a(bb)(1) - (6), adopted by reference in 7 AAC 160.900; if the payment rate calculated under this subsection is less than that amount, the department will pay the health clinic under (b) of this section; for state fiscal year 2018, the department will not adjust for inflation the payment rate under (A) or (B) of this paragraph; to ensure compliance with this paragraph, the department will evaluate annually the (A) Medicare Economic Index as required by 42 U.S.C. 1396 a(bb)(3)(A), adopted by reference in 7 AAC 160.900; and(B) number set out in the first quarter publication of Global Insight's Health-Care Cost Review, Skilled Nursing Facility Total Market Basket;(4) the department will annually evaluate the payment rate calculated under this subsection to ensure it is within the payment limit set under 42 C.F.R. 447.300- 447.371, adopted by reference in 7 AAC 160.900.(d) For purposes of this section, the department will consider health clinic costs to be allowable costs if they are documented costs as described in 42 C.F.R. 405.2468, adopted by reference in 7 AAC 160.900, after all adjustments, cost disallowances, and reclassifications have been made, if those costs are reasonable in amount, if they are proper and necessary for the efficient delivery of health clinic services, and if they are not disallowed under AS 47.07, 7 AAC 105 - 7 AAC 160, or applicable federal statutes or regulations. Allowable costs do not include overhead costs not directly related to health clinic services, bad debts, charity care, contractual allowances, return on equity, income taxes, or services and supplies furnished to non-Medicaid recipients for free or without regard to the recipient's ability to pay.(e) In establishing a payment rate under this section, the department will not include services that are paid by a different payment rate methodology in 7 AAC 105 - 7 AAC 160. Services that are paid by a different payment rate methodology include (1) prescription drugs subject to the drug coverage limitations in 7 AAC 120.100 - 7 AAC 120.130 and paid in accordance with 7 AAC 145.400 - 7 AAC 145.410; and(2) labor and delivery services provided by a physician, a physician assistant, or an advanced practice registered nurse paid in accordance with 7 AAC 145.050.(f) Changes in the scope of services that are provided by a health clinic will be used to adjust the per-visit rate for a health clinic. These adjustments will be made upon the written notification of the provider and approval by the department. The change in scope of services must have increased or decreased a health clinic's cost per visit by more than two and one-half percent. The change in the scope of services must be directly related to a new or terminated program or service, and may not include general increases or decreases in costs associated with programs that were already a part of an established rate. The department will examine a written request for a change in scope of services no more than 60 days after receipt to determine if the change satisfies the requirements of this subsection. The health clinic shall submit to the department a brief narrative describing the services that are to be added or deleted or that result in an increase or decrease in the scope of services. Additionally, a health clinic that proposes a change in the scope of services for future implementation must provide a one-year budget that specifies the change in the scope of services, shows the projected number of visits, and provides revenue and expense projections associated with the proposed change. If the department determines that a change in the scope of services has occurred, the per-visit rate will be adjusted. A final decision regarding the disposition of a request for a change in scope of services will be given to a clinic in writing. If the health clinic notifies the department (1) before implementing the change in the scope of services that a change will occur, any adjustment will be made to coincide with the implementation date of the change;(2) after implementing the change that an increase or decrease in the scope of services occurred, any adjustment will be made to coincide with the (A) date of notification, for the addition of a category of service; a post-implementation request for a rate adjustment must be received no later than 45 days after the change in scope of services occurred; or(B) implementation date of the change, for the deletion of a category of service or a change in the intensity of a service.(g) A health clinic that enrolls during or after health clinic fiscal year 2000, and that (1) submits cost data for a minimum of six months during the health clinic fiscal year 1999 and 2000 period, may request payment at a per-visit rate that is based on the submitted data;(2) does not submit cost data for a minimum of six months, will be paid a per-visit rate equal to the statewide weighted average of the total Medicaid per-visit payment rates made to health clinics; the base per-visit rate will be re-determined (A) after Medicare cost reports for health clinic fiscal years one and two are submitted and are reviewed by the department, and will be inflated in accordance with (c) of this section, except that the first two fiscal years of data that the clinic has available will be substituted for fiscal years 1999 and 2000; and(B) to allow payments for each succeeding health clinic fiscal year to be established by using the base per-visit rate set for the previous clinic fiscal year, and increasing that rate by the percentage increase in the number set out in the first quarter publication of Global Insight's Health-Care Cost Review, Skilled Nursing Facility Total Market Basket; adjustments for that clinic fiscal year will be made to take into account any increase or decrease in the scope of services that the department has approved under (f) of this section, whether the change in the scope of services is proposed for that fiscal year or occurred in the preceding fiscal year.(h) A health clinic may appeal, under 7 AAC 150.240, the final rate set by the department by submitting a written request to the commissioner, so that the commissioner receives the request no later than 30 days after the date that the final rate agreement letter is issued.(i) The amount, duration, and scope of primary care and ambulatory medical services provided by a health clinic are subject to the limits upon covered services under 7 AAC 105 - 7 AAC 160 as applied to other Medicaid recipients.(j) The department will pay a health clinic that is outside this state and that provides covered services to a Medicaid recipient eligible under 7 AAC 100 at the lesser of the (1) per-visit rate established by the agency responsible for Medicaid in the jurisdiction where the health clinic is located; or(2) the average per-visit rate established by the department for health clinics in this state.(k) In this section, (1) "ambulatory services" has the meaning given in 7 AAC 140.229;(2) "change in the scope of services" means (A) the addition of a category of service to, or the deletion of a category of service from, those categories of service that a rural health clinic or federally qualified health center provides; or(B) an increase or decrease in the intensity of a category of service provided by a rural health clinic or federally qualified health center that may be reasonably expected to span at least one year; in this subparagraph, "intensity" means the cost of a category of service due to a change in the level of medical care provided to the population served by the rural health clinic or federally qualified health center;(3) "medically necessary and appropriate" means (A) reasonably calculated to diagnose, correct, cure, alleviate, or prevent the worsening of medical conditions that endanger life, cause suffering or pain, result in illness or infirmity, threaten to cause or aggravate a disability, or cause physical deformity or malfunction; and(B) used because an equally effective more conservative or substantially less costly course of medical diagnosis or treatment is not available or suitable for the Medicaid recipient requesting the service; for purposes of this subparagraph, "course of treatment" includes mere observation or, if appropriate, no treatment at all.(l) This section does not apply to a federally qualified health center that elects to be reimbursed under 7 AAC 155.010(1).Eff. 2/1/2010, Register 193; am 10/1/2017, Register 223, October 2017; am 4/24/2020, Register 234, April 2020; am 11/1/2021, Register 240, January 2022Authority:AS 47.05.010
AS 47.07.030
AS 47.07.040
AS 47.07.070
AS 47.07.073