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DSL Memo Series 2002-24
ACTION MEMO

December 20, 2002

STATE OF WISCONSIN
Department of Health and Family Services
Division of Supportive Living

To:
Area Administrators/Assistant Area Administrators
Bureau Directors
County Departments of Community Programs Directors
County Departments of Developmental Disabilities
Services Directors
County Departments of Human Services Directors
County Departments of Social Services Directors
Licensing Chiefs/Section Chiefs
Tribal Chairpersons/Human Services Facilitators

From: 
Sinikka McCabe, Administrator

Re: COMMUNITY-BASED MEDICAID ADMINISTRATIVE CLAIMING (CBMAC)

Note: Whenever Medicaid is referenced in this letter it includes Medicaid, Badgercare, HealthCheck and SeniorCare.

Document Summary

The Wisconsin Department of Health and Family Services (DHFS) is preparing to implement a Community-Based Medicaid Administrative Claiming (CBMAC) program. DHFS will be implementing the CBMAC program using a Random Moment Sampling (RMS) process to identify Medicaid reimbursable administrative activities performed by county Department of Human Services, Social Services, and Community Programs staff and local contract providers for Developmental Disabilities, Elderly and Disabled, Mental Health, and Substance Abuse Services. Over the past several months, regional meetings were held with county human service directors explaining this project and the shared benefits between state and counties of implementing it. This memo is intended to provide counties with the information necessary to participate in the CBMAC program. Counties that want to begin participation in the first quarter of 2003, must return an attached agreement to DHFS by January 10, 2003.

State Medicaid Agencies by law are required to perform certain functions to properly and efficiently administer the State’s Medicaid plan including Medicaid outreach, facilitating applications for Medicaid referral, coordination and monitoring of Medicaid services, and program planning and interagency coordination related to Medicaid services.

These Medicaid administrative functions may be delegated by the State to public or quasi-public community based providers (i.e., county staff and contract providers) to assist the Medicaid agency in achieving these objectives. Community-Based Medicaid Administrative Claiming (CBMAC) is a mechanism whereby states are eligible to claim federal Medicaid funds/reimbursement for qualifying Medicaid administrative activities performed by these entities.

The counties perform these activities and many of the activities are funded 100 percent with state Community Aids, county match and/or county tax levy funding. However, portions of the costs of these activities are eligible for federal Medicaid reimbursement. Therefore, the State is in the process of increasing the state Medicaid recoveries for county administrative costs by adding a voluntary random moment time study (RMTS) for the counties and federal claiming to administrative activities related to Developmental Disabilities, Elderly and Disabled, Mental Health, and Substance Abuse Services.

Wisconsin counties are responsible for providing mental health, elderly, disability, alcohol and drug abuse and developmental disability services to eligible county clients. Counties are expending large amounts of state and local funding, supporting county and Medicaid administrative services that are presently uncompensated or unmatched by federal matching programs.

The administrative expenditures appropriate for reimbursement by Medicaid are those that are in support of the objectives of the Wisconsin Medicaid program. Allowable administrative activities ensure that: 1) individuals are enrolled in Medicaid; 2) qualified providers exist to provide services; and 3) coordinated, comprehensive services are provided in the least restrictive setting. Activities include:

• Medicaid outreach;
• Facilitating an application for Medicaid;
• Medicaid program planning, development, training, monitoring and quality assurance;
• Medicaid administrative case management activities not reimbursed through targeted case management services; and
• Medicaid specific training for staff.

The Department submitted to the Legislative Joint Committee on Finance as part of its expenditure plan for Income Augmentation Funds a request to allocate $3,011,594 as incentive payments to counties to participate in the CBMAC program. At this time no action was taken by the Legislature’s Joint Committee on Finance on the Department's request.

The Department’s biennial budget request for FY 2003-05 includes a proposal to share 50 percent of the net revenues claimed through the CBMAC program with the counties. The process being proposed is similar to the Child Welfare/Social Services Random Moment Time Study that counties presently participate in.

To obtain Medicaid federal funding, there are three key components or program participation requirements: Time Reporting Monthly, Financial Data Collection and Medicaid Eligibility Rate. Each of these requirements is discussed below.

Time Reporting

The time reporting process, CBMAC Random Moment Sample (RMS), measures the work effort of all county and contracted full time direct service staff that may perform Medicaid administrative activities by sampling and analyzing the work efforts (activities) of randomly selected staff within the participant group. It employs a technique of polling employees at random moments over a given time period and then calculating the results of the polling to determine the percentage of time spent by staff on CBMAC eligible activities. The polling will be performed via phone calls to randomly selected staff participating in the CBMAC RMS. The number of samples per worker will depend on the number of eligible workers participating in the RMS. It is anticipated that responding to the call will take approximately two minutes per call and that a worker would receive a maximum of 4-5 calls per quarter for a total of 2,500 random moments per quarter. This method provides a statistically valid means of determining the work effort eligible for CBMAC reimbursement.

Counties would be responsible for assigning a CBMAC Random Moment Sample (RMS) Coordinator, who would identify staff and contract personnel to participate in the RMS, and train participants. The State will administer and apply the RMS results.

Monthly Financial Data Collection

To calculate Medicaid administrative costs and to assure that there is no duplication of federal funds for the same services, monthly reporting of Administrative Management Support and Overhead (AMSO) by the counties using the CARS system is required. A new profile will be added to the CARS system and will be used to identify all costs allocable to county and contractor staff included in the RMS sample population. Allowable costs include all costs attributed to the participants included in the time study sample population, costs of non-sampled supervisory and clerical staff that provide 100 percent direct support to the participants, direct costs that relate solely to expenditures of the participants identified by the county, and attributable indirect costs. Through the CARS system, federal funds that support staff through the time study will be offset.

The financial reporting process and the time reporting ensures that federal funds and unallowable costs are excluded from the claim calculation model. As state policies and practices change, the financial reporting process can be easily amended to address changes.

Medicaid Eligibility Rate

A county-specific Medicaid Eligibility Ratio (MER) will be applied to those Medicaid administrative activities that require a prorating of the Medicaid-eligible population to the claim calculation process. Applying the MER in the claim calculation process removes the burden of the sample participant to determine the Medicaid-eligibility status of a client when completing the time study and thus increases reporting accuracy and integrity of the claim.

County Department of Human Services, Social Service, and Community Programs who voluntarily participate in the Community-Based Medicaid Administrative Claiming (CBMAC) process must agree to all of the following:

1. Perform Medicaid Title XIX outreach and administrative services.
2. Provide personnel to submit rosters, distribute instructions, provide training, and assist with quality assurance and submission of the requested information.
3. Assure that participating staffs attend the required training prior to the inclusion in the CBMAC RMS sample.
4. Participate in CBMAC time studies using random moment sampling and attend ongoing training as required.
5. Prepare and submit monthly expenditure reports through CARS following instructions provided by DHFS.
6. Submit monthly financial information through the CARS reporting system in the format requested by DHFS to provide documentation of the use of local tax levy or community aid funds for matching federal funds.
7. Maintain documentation related to Medicaid Administrative claiming for a minimum of five (5) years after the date the financial expenditure costs are reported.

The Department of Health and Family Services (directly and/or through its agents) agrees to:

1. Conduct and complete the quarterly telephone survey for the RMS time study.
2. Complete a full analysis of all data acquired from the county by the methodology developed and approved by the Division of Cost Allocation (DCA) and verify the contribution from the county for Medicaid reimbursement through this program.
3. Provide appropriate training materials and initial and ongoing training for the use of the CBMAC methodology developed and approved by DCA to the county.
4. Provide and maintain financial reporting instructions to the county.
5. Provide initial and ongoing financial reporting training to the county regarding compilation of expenditure data for reporting through CARS.
6. Provide technical assistance to the county to support participation in the CBMAC program.

7. Provide and maintain a toll-free number to facilitate responses to queries from the county.
8. Make payment to the county after receiving federal revenue by either check or by direct deposit to the designated financial institution based on the share or proportion of new revenue the state is authorized by state policy or statue to distribute to counties.

The Department has entered into an agreement with MAXIMUS, Inc. to assist with the administration of CBMAC that includes providing training to the counties, operating the Random Moment Sample system, and assisting with the preparation of the federal claims.

1. To voluntarily participate in the January – March 2003 quarter, counties must sign the attached agreement and submit the agreement to the appropriate Area Administrator no later than January 10, 2003. If a county wishes to participate at a later date, the agreement must be signed 45 days prior to the beginning of the next quarter. For example, if a county wishes to participate beginning the April - June 2003 quarter, the agreement must be submitted to the Area Administrator by February 15, 2003.
2. To participate in the January – March 2003 quarter, a participating county must have at least two (2) representatives participate in the Train-the-Trainers session in January 2003. Those that should participate include the County RMS Coordinator, Financial Manager, Director/Deputy Director, and Mental Health, AODA, Long Term Care and Developmental Disabilities Program Managers/Supervisors.
3. Train-the-Trainers sessions will occur in January 2003. The tentative schedule of half-day sessions follows:

January 6-7 Northeast Region (Green Bay)
January 8-9 Northern Region (Mosinee)
January 13-14 Southern Region (Madison)
January 15-16 Southeastern Region (Waukesha)
January 17 Milwaukee
January 21-22 Western Region (Eau Claire)
January 23 Northwest Counties (Hayward)

An announcement was sent out from your Area Administration with the specifics and registration information.

Additional training will be provided on an as needed basis.

4. A participating county must train all RMS staff participants on responding to the telephone survey and the definitions of the activity codes.
5. Counties must electronically submit rosters of participants to MAXIMUS within 3 working days after participating in the January training and 20 days prior to the beginning of the next quarter, thereafter.

REGIONAL OFFICE CONTACT:
Area Administrator

CENTRAL OFFICE CONTACT:
Dennis Dombrowicki
DSL/AO
(608) 266-3057
dombrdh@dhfs.state.wi.us

Catherine Lorence
DMT/BFS Federal Funding Accountant
(608) 267-7846 
lorencm@dhfs.state.wi.us  

Attachment

ADMINISTRATIVE CLAIMING AGREEMENT

INTERAGENCY AGREEMENT

1. TERM. The term of this agreement is made and entered into for the period of _________________, 2003 through December 31, 2003.
2. The County agrees to:
   1. Perform Medicaid Title XIX outreach and administrative services.
   2. Provide personnel to submit rosters, distribute instructions, provide training, and assist with quality assurance and submission of the requested information.
   3. Assure that participating staff attend the required training prior to the inclusion in the CBMAC RMS sample.
   4. Participate in CBMAC time studies using random moment sampling and attend ongoing training as required.
   5. Prepare and submit monthly expenditure reports through CARS following instructions provided by DHFS.
   6. Submit monthly financial information through the CARS reporting system in the format requested by DHFS to provide documentation of the use of local tax levy or community aid funds for matching federal funds.
   7. Maintain documentation related to Medicaid Administrative claiming for a minimum of five (5) years after the date the financial expenditure costs are reported.
3. The Department of Health and Family Services (directly and/or through its agents) agrees to:
1. Conduct and complete the quarterly telephone survey for the RMS time study.
2. Complete a full analysis of all data acquired from the County by the methodology developed and approved by the Division of Cost Allocation (DCA) and verify the contribution from the County for Medicaid reimbursement through this program.
3. Provide appropriate training materials and initial and ongoing training for the use of the CBMAC methodology developed and approved by DCA to the County.
4. Provide and maintain financial reporting instructions to the County.
5. Provide initial and ongoing financial reporting training to the County regarding compilation of expenditure data for reporting through CARS.
6. Provide technical assistance to the County to support participation in the CBMAC program.
7. Provide and maintain a toll-free number to facilitate responses to queries from the County.
8. Make payment to the County after receiving federal revenue by either check or by direct deposit to the designated financial institution based on the share or proportion of new revenue the state is authorized by state policy or statue to distribute to counties.
4. AUDIT DISALLOWANCES. In the event that a state or federal audit discloses unallowable costs, recoupment of the County share of the disallowance will be treated as a reduction of subsequent payments of the County proportion of federal revenues received for CBMAC activities.
5. AUTHORIZATION. This agreement is contingent upon authorization of Wisconsin and United States law and any material amendment or repeal of same affecting relevant funding to, or authority of, the Department shall serve to terminate this agreement except as further agreed by the parties hereto.
6. TERMINATION OF THIS AGREEMENT. This agreement may be canceled by either party by providing written notice thereof at least ninety (90) days in advance of the effective date of the termination.
7. AMENDMENT. The parties agree that any amendments to this agreement shall be by mutual agreement and shall be in writing.