FISCAL NOTE

Date Requested: February 13, 2017
Time Requested: 01:40 PM
Agency: Health and Human Resources, WV Department of
CBD Number: Version: Bill Number: Resolution Number:
2059 Introduced HB2376
CBD Subject: Health


FUND(S):

0403 - DIV OF HUMAN SERVICES GENERAL ADMINISTRATION FUND/8722 - CONS FEDERAL FUNDS DIV HUMAN SERVICES GEN ADMN FD

Sources of Revenue:

General Fund,Special Fund,Other Fund Federal

Legislation creates:

Neither Program nor Fund



Fiscal Note Summary


Effect this measure will have on costs and revenues of state government.


The purpose of this bill is to provide that the Bureau for Medical Services be renamed the Department of Medical Services with the Commissioner of the Bureau for Medical Services becoming the Secretary of the Department of Medical Services. The bill provides that the Department continue to operate as currently configured as the Bureau for Medical Services with the structure of the Department of the Health and Human Resources for administrative support, interagency cooperation and program support. The bill; removes the Human Rights Commission, the Division of Human Services, Bureau for Public Health, Office of Emergency Medical Services and the Emergency Medical Service Advisory Council, Health Care Authority, Commission on Mental Retardation, Women's Commission and The Child Support Enforcement Division from administration by the Department of Administration. It also provides that the Bureau for Public Health, The Bureau for Child Support Enforcement, The Bureau of Children and Families, The Office of the Inspector General, The Health Care Authority, The State Commission on Intellectual Disability, The Women's Commission, The Commission for the Deaf and Hard of Hearing; and The James H. “Tiger” Morton Catastrophic Illness Commission are to be administered as a part of the Department of Health and Human Resources. The bill provides that the Bureau of Medical Services and The Children's Health Insurance Agency are incorporated in and administered as a part of the Department of Medical Services. Finally, the bill makes technical changes in various chapters of the code to reflect the creation of the Department of Medical Services. The Department of Health and Human Resources (DHHR) is an integrated agency: financially, administratively, technologically, operationally, and philosophically. Most importantly, DHHR is linked by the population it serves. The nature of the services provided and clients served necessitate interaction of staff, systems, policy, and law. Functionally, the ties that bind DHHR cannot be undone without tremendous resources or significant bureaucratic complication being exacted on clients and stakeholders. DHHR has established administrative support (systems and staff), ie payroll, accounting, budget, grants management, personnel, information technology, etc., that could potentially continue to provide support to the new Agency, however, the fact that agencies would be separate would create challenges to the efficiency realized from the current structure. Because of the inefficiency, it is questionable that this would continue realistically without additional costs. If the new Department truly was separate from the DHHR, account code structure would be separate, creating the need for completely separate organizational units. This will impact letters of credit as well as access and authorization that would now cross separate organization units. If as a result the new separate agency determines it will perform these functions, not only will there be an additional cost to the state, but a significant loss of revenue to support the DHHR. The allocation to Medicaid for central agency support costs is approximately $2.1M. DHHR has a cost allocation plan that facilitates the sharing of costs, i.e. county offices that serve clients from multiple programs so that all benefitting programs provide funding to support the current structure within the Department. However, creating two separate organizations adds administrative burden and delayed cash flow for the agencies. The ability to directly draw Medicaid to help support these expenses will be gone. Using agreements to facilitate the ongoing support vs being able to directly draw federal funds creates a cash flow timing issue due to the time that would transpire for the billing/reimbursement to take place. The amount of funds that are utilized to support staff throughout the Department is too large to have to wait for reimbursement and would likely result in failure to meet payroll. Historically, approximately $20-25 million a month is expended to support shared costs for the Department with approximately $7-10 million attributable to Medicaid. Without immediate access to draw these funds to support incurred costs, this will result in a cash flow issue trying to cover current expenditures for payroll and operational costs for the $7-10 million attributable to Medicaid. Additionally, the Department would have to alter its plan to account for the new Agency, get it submitted and approved prior to draw down of any federal dollars to support these costs. A review of the State Plans for Medicaid and CHIP would need to be performed and, if necessary, amended to reflect the new Department of Medicaid. All of this would take considerable time and resources to accomplish. Medicaid shares the eligibility system and some payments are currently processed through other systems as well, i.e. CHET. Additionally, the MMIS processes payments for other bureaus, thereby creating even more of a need for transfer of funding to support. In terms of service delivery, even though the current configuration of eligibility determination and assistance to clients with multiple benefit needs would be maintained, clients would still have to navigate between multiple agencies. The current structure comprehensively and collaboratively approaches both physical and mental health needs, coordinating health and medical preparedness and response activities related to disasters, public health emergencies, preventive health and treatment, etc. Inclusion of the Medicaid Agency within the DHHR provides a means for effective collaboration among agencies to reduce administrative overhead. Fragmentation of Safety Net services and funding will necessarily reduce both the efficiency and the effectiveness of integrated service delivery, especially in light of decreases in federal funding. The current structure maintains focus on client needs and service delivery – operating as a united organization continuously striving to improve performance and manage costs through innovation, creativity and deployment of technology based solutions. Each Bureau within the DHHR has various working relationships with other Bureaus within the DHHR and these relationships serve an essential and complimentary role in the provision of services to the citizens of West Virginia. However, Medicaid is the most intertwined DHHR bureau and has significant financial connectivity to all other DHHR bureaus and entities. A few examples of this interconnectivity are as follows: 1. The Bureau for Medical Services oversees West Virginia Medicaid and the Bureau for Children and Families (BCF) takes Medicaid and Children's Health Insurance Program (CHIP) applications and determines eligibility for these populations. 2. The Office of the Inspector General provides quality assurance reviews of BCF’s family assistance, investigation when customer fraud is reported, and grievance hearings for BCF customers that believe they have been denied an entitlement. 3. The BHHF is partnering with the Bureau of Medical Services (BMS) on multiple initiatives, such as the WV Screening Brief Intervention and Referral to Treatment (SBIRT) project which is an initiative that integrates behavioral health and primary care services in community based settings; the Medicaid Emergency Psychiatric Demonstration (MEPD) project which enables free standing psychiatric hospitals to bill Medicaid; and, Take Me Home West Virginia, which allows for people with disabilities and individuals age 65 or older to move from an institutional setting into the community. 4. The BHHF operates state psychiatric hospitals and nursing homes that are funded in part by the Bureau for Medical Services (BMS) and licensed through the Office of Health Facilities Licensure and Certification (OHFLAC). Discharge planning for individuals for whom the Department is responsible is a collaborative process involving the Bureau for Children and Families (BCF) Adult Guardian, a case manager from the hospital, and BHHF grantees and others from the community. 5. While individuals with intellectual/developmental disabilities (IDD) who are deemed eligible for the Intellectual & Developmental Disabilities Waiver program through the Bureau for Medical Services (BMS) are waiting for their placement to become available, there are opportunities that exist with the BHHF to help them access a single eligibility process for all other DHHR programs for which they may be eligible. The BHHF staff help determine other services they may be eligible for and offer assistance with referrals as needed. Services include but are not limited to the IDD Supports Grant Program, Unmet Needs Program, and Family Support Program (BHHF); Children with Special Healthcare Needs, Birth to Three Program, health care screenings (Bureau for Public Health); Children's Health Insurance Program (CHIP); Non-Emergency Medical transportation, child care resources (Bureau for Children and Families); Traumatic Brain Injury Waiver, Aged and Disabled Waiver; Personal Care (Bureau for Medical Services). 6. Youth leaving the foster care system and transitioning to adulthood may receive independent living services including housing through the BCF, behavioral health services and supports through the BHHF and community behavioral health providers, and healthcare through the BMS, if eligible. Working relationships of each Bureau are in place to assist with these services. 7. The Bureau for Medical Services oversees West Virginia Medicaid and the Bureau for Children and Families (BCF) takes Medicaid applications and determines eligibility for this population. The BCSE provides information regarding any existing insurance coverage and where appropriate will establish and enforce medical support obligations. 8. The Health Statistics Center’s (HSC) records document all major life events (birth, death, marriage, divorce) for both legal and health information purposes and fetal death (stillbirth, miscarriage) and induced termination of pregnancy for health information. Data gathered by HSC is used by offices within the Bureau for statistical purposes. Work is integrated between the Bureau for Medical Services and Bureau for Behavioral Health and Health Facilities. 9. Medicaid utilizes other bureaus within DHHR to carry out requirements of the Medicaid program, i.e. BPH nurses for the Breast and Cervical Cancer services, OHFLAC for Nurse Aid Training, BPH staff for the Early Periodic Screening and Diagnostic Testing (EPSDT). 10. Funding, Rate Setting, reimbursement, and cost settlements for multiple programs such as Birth to Three, Child Care Residential, nursing homes, etc. are interrelated to maximize federal funding. This ongoing collaboration that occurs provides the Department the ability to respond quickly to emerging health and safety issues and conditions, serve clients efficiently and maintain compliance with stringent and varied Federal regulations. Separating would further inhibit communication, result in significant cost to the public, both from poor coordination of services and added bureaucracy, and impede the ability to coordinate care and achieve programmatic goals and efficiencies.



Fiscal Note Detail


Effect of Proposal Fiscal Year
2017
Increase/Decrease
(use"-")
2018
Increase/Decrease
(use"-")
Fiscal Year
(Upon Full
Implementation)
1. Estmated Total Cost 0 2,174,937 2,174,937
Personal Services 0 748,178 748,178
Current Expenses 0 1,426,759 1,426,759
Repairs and Alterations 0 0 0
Assets 0 0 0
Other 0 0 0
2. Estimated Total Revenues 0 0 0


Explanation of above estimates (including long-range effect):






Memorandum






    Person submitting Fiscal Note: Bill J. Crouch
    Email Address: dhhrbudgetoffice@wv.gov