PROPOSED RULES
SOCIAL AND HEALTH SERVICES
(Medical Assistance Administration)
Original Notice.
Preproposal statement of inquiry was filed as WSR 99-06-084.
Title of Rule: WAC 388-550-4500 Payment method--RCC.
Purpose: To update rule content to reflect current department policy. To comply with the Governor's Executive Order 97-02. This rule was originally filed under WSR 99-09-091 as a proposed rule, but due to an error, the text for this rule that was included in the filing did not contain any changes from the existing rule text. The department has withdrawn this rule from the WSR 99-09-091 filing and is refiling.
Statutory Authority for Adoption: RCW 74.08.090, 42 U.S.C. 1395x(v), 42 C.F.R. 447.271, 42 C.F.R. 447.11303, and 42 C.F.R. 447.2652.
Statute Being Implemented: RCW 74.08.090, 42 U.S.C. 1395x(v), 42 C.F.R. 447.271, 42 C.F.R. 447.11303, and 42 C.F.R. 447.2652.
Summary: These amendments update the method by which the department calculates hospital ratio of costs-to-charges (RCC).
Reasons Supporting Proposal: To comply with the Governor's Executive Order 97-02. To update rule content to reflect current department policy.
Name of Agency Personnel Responsible for Drafting, Implementation and Enforcement: Alan McMullen, DOS/MAA, 623 8th Avenue S.E., Olympia, WA 98501, (360) 586-6698.
Name of Proponent: Department of Social and Health Services, Medical Assistance Administration, governmental.
Rule is not necessitated by federal law, federal or state court decision.
Explanation of Rule, its Purpose, and Anticipated Effects: Reflects updated methods that the department uses to calculate hospital ratio of costs-to-charges (RCC).
The purpose of the proposed amendments are to improve staff efficiency and customer compliance by reflecting current policy in rule, as well as clarify, consolidate, and reorganize the rule.
The anticipated effect is that the purpose stated above will be achieved.
Proposal Changes the Following Existing Rules: Amends WAC 388-550-4500 to update the rule to reflect current department policy in calculating hospital ratio of costs-to-charges (RCC).
No small business economic impact statement has been prepared under chapter 19.85 RCW. The department has analyzed the proposed amendments and concludes that no new costs will be imposed on the small businesses affected by them.
RCW 34.05.328 does not apply to this rule adoption. The rules do not fit the definition of a significant legislative rule.
Hearing Location: Lacey Government Center (behind Tokyo Bento Restaurant), 1009 College Street S.E., Room 104-B, Lacey, WA 98503, on July 27, 1999, at 10:00 a.m.
Assistance for Persons with Disabilities: Contact Paige Wall by July 16, 1999, phone (360) 664-6094, TTY (360) 664-6178, e-mail wallpg@dshs.wa.gov.
Submit Written Comments to: Identify WAC Numbers, Paige Wall, Rules Coordinator, Rules and Policies Assistance Unit, P.O. Box 45850, Olympia, WA 98504-5850, fax (360) 664-6185, by July 27, 1999.
Date of Intended Adoption: July 28, 1999.
June 8, 1999
Marie Myerchin-Redifer, Manager
Rules and Policies Assistance Unit
2597.1(1)(a) MAA calculates a hospital's ratio of costs-to-charges (RCC) by dividing adjusted allowable operating costs by adjusted patient revenues associated with these allowable costs.
(b) MAA bases these figures on the annual Medicare cost report data provided by the hospital.
(c) MAA updates hospitals' RCC rates annually with the submittal of new HCFA 2552
Medicare cost report data. Prior to computing the ((ratio)) RCC, MAA excludes increases in
operating costs or total rate-setting revenue attributable to a change in ownership.
(((2))) (d) MAA limits a hospital's RCC to one hundred percent of its allowable charges. ((MAA recoups payments made to a hospital in excess of its customary charges to the general
public.
(3) MAA establishes the basic hospital payment by multiplying the hospital's assigned))
(2) For hospital inpatient services, the hospital RCC payment is determined by
multiplying the hospital’s specific RCC rate by the allowed charges for medically necessary
services((. MAA deducts client)), less any client responsibility (spend-down) ((or)) and
third-party liability (TPL) ((as identified on the billing invoice or by MAA from the basic
payment to determine the actual payment due from MAA for that hospital admission)).
(((4))) (3) MAA uses the RCC payment method to ((reimburse)) pay:
(a) MAA peer group A hospitals;
(b) Other DRG-exempt hospitals identified in WAC 388-550-4300; and
(c) ((Any hospital for)) DRG-exempt services described in WAC 388-550-4400.
(((5))) (4) MAA ((deems the RCC for in-state and border area hospitals lacking sufficient
HCFA 2552 Medicare cost report data the weighted average of the RCC rates for in-state
hospitals)) uses the Washington in-state average RCC to pay for Washington in-state and border
area hospitals that are exempted from the DRG payment method and do not have a HCFA 2552
Medicare cost report.
(((6))) (5) MAA calculates ((an outpatient ratio of costs-to-charges by dividing the
projected costs by the projected charge multiplied by the average RCC.
(a) In no case may the outpatient adjustment factor exceed 1.0.
(b) The outpatient adjustment factor is updated annually effective November 1)) the hospital’s specific outpatient RCC by multiplying the hospital specific inpatient RCC by the outpatient adjustment factor. The outpatient adjustment factor:
(a) Is the projected costs divided by the projected charges multiplied by the in-state average RCC.
(b) Is limited at 1.00.
(c) Is updated as determined by the legislature.
[Statutory Authority: RCW 74.08.090, 42 USC 1395 x(v), 42 CFR 447.271, 447.11303, and 447.2652. 99-06-046, § 388-550-4500, filed 2/26/99, effective 3/29/99. Statutory Authority: RCW 74.08.090, 74.09.730, 74.04.050, 70.01.010, 74.09.200, [74.09.]500, [74.09.]530 and 43.20B.020. 98-01-124, § 388-550-4500, filed 12/18/97, effective 1/18/98.]