FY 1999-2000 COMMUNITY HEALTH BUDGET - H.B. 4299 (C-1): CONFERENCE REPORT

FY 1998-99 Year-to-Date Gross Appropriation $7,483,537,800
Changes from FY 1998-99 Year-to-Date:
Items Included by the Senate and House
1. Medicaid Match Rate Change. The Senate and House recognized $133,086,000 GF/GP in savings from an increase in the Federal Medicaid match rate from 52.72% to 55.11%. 0
2. Qualified Health Plans Rate Increase. The Senate and House included funding for a 4% increase in rates paid to Qualified Health Plans. 48,803,700
3. Economic Adjustments. The Senate and House made standard economic adjustments. 23,199,200
Conference Agreement on Items of Difference
4. Healthy Michigan Fund (HMF). The Conference Committee eliminated a number of one-time projects; continued other existing projects, and funded a number of new projects with available balances from the HMF. (2,357,200)
5. Community Mental Health Funding. The Conference Committee added funding to reflect increased Medicaid earnings, full-year funding for a wage pass-through, and increased funding to eliminate a shortfall caused by Medicaid mental health managed care capitation rates being set too high to be supported by available appropriations. 146,115,400
6. Office of Services to the Aging. The Conference Committee used Tobacco Settlement revenue to establish a Long Term Care Advisor line and to expand Senior Respite Services. 8,100,000
7. Medicaid Base Funding. The Conference Committee increased funding to reflect the projected FY 1999-2000 Medicaid base and projected earnings from Medicaid special financing. 234,446,800
8. Medicaid Non-Capitated Fee Increases. The Conference Committee included a 3.1% increase for hospitals, 4.0% for other non-capitated providers, funding for a Rural Hospital Initiative, a $30 per month increase in the Adult Foster Care Personal Care Services rate, an 11% increase in Home Health visit rates, and increased funding for Dental Services. 62,455,900
9. Long Term Care Funding Increases. The Conference Committee included a 4.0% increase for Nursing Homes, a $0.75 per hour wage/benefits pass-through, an increase in the Nursing Home Personal Needs Allowance from $30 per month to $60 per month, and a one-time Long-Term Care Innovation Grants Program. 98,791,800
10. New Senior Prescription Program. The Conference Committee included funding for the Elder Prescription Insurance Coverage (EPIC) program, which would cover prescription costs for seniors with incomes up to 200% of poverty. 45,000,000
11. Other Adjustments. Other Adjustments by the Conference Committee result in a slight increase in funding. 4,612,100
Total Changes 669,167,400
FY 1999-2000 Conference Report Gross Appropriation $8,152,705,200
Amount Over/(Under) GF/GP Target: $0
FY 1999-2000 COMMUNITY HEALTH BUDGET - BOILERPLATE HIGHLIGHTS
Changes from FY 1998-99 Year-to-Date:
Items Included by the Senate and House
1. Medicaid Pharmacy Dispensing Fee. The House, Senate and Conference Report continued the pharmacy dispensing fee at the FY 1998-99 $3.72 level . (Sec. 1603)
Conference Agreement on Items of Difference
1. Community Mental Health (CMH). Several sections intended by the Senate to enhance legislative oversight of mental health services program spending and services were modified in the Conference Report to remove restrictions on the payment of purchase of state services funds to CMH boards and to report on CMH use of State mental health facilities and private hospitals. (Secs. 218, 235, 402, 407, 604)
2. Michigan Public Health Institute. Current year /House language is changed to require more information on projects, and copies of all State funded reports and publications; and new language requiring an external review of the research done by the Institute, and requiring State Auditor General audits of State funded projects is included in the Senate bill and the Conference Report. (Secs. 224, 225, 226)
3. Abstinence Program. The Conference Report modifies House and Senate language on Federal abstinence education funds to target ages 9-17 and give priority to organizations that do not provide contraceptives to minors. (Sec. 1106a)
4. Medicaid Pharmacy. The Conference Report requires continued implementation of an automated claims adjudication system, and a prospective drug utilization review system and disease management system (Sec. 1612).
5. Emergency Room Services. The Conference Report includes Senate language that prohibits health plans, as a condition of reimbursement, from preauthorizing diagnostic and stabilization medical services for Medicaid recipients in emergency rooms (ER). The Conference Report modifies the language to cover "screening" rather than "diagnostic" services. Language requiring the convening of a workgroup to recommend ER reimbursement rates, and to develop educational materials to assist Medicaid recipients in understanding appropriate ER use is also included in the Conference Report. (Sec. 1690)
6. Medicaid Uniform Billing. The Conference Report includes Senate language requiring the development by the Department, in conjunction with Medicaid providers, of a uniform Medicaid billing form, and specifies the treatment of bills with non-correctable errors, and penalties to be applied if bills are not paid on time or duplicate bills are submitted. (Sec. 1691)
7. Maternal and Infant Support (MSS/ISS) and Early and Periodic Screening, Diagnosis, and Treatment (EPSDT). The Conference Committee retains new Senate language on MSS/ISS and EPSDT services directing the development of standards and definitions for such services, prohibiting preauthorization of certain services, and modifies Senate language requiring reporting on services provision. Language is also included directing that MSS/ISS and EPSDT outreach funding be provided to qualified health plans to contract with local health departments to provide outreach services. (Secs. 1692, 1693)
8. Elder Prescription Insurance Coverage Program (EPIC). The Conference Committee modifies Senate language that creates a new program that would extend prescription coverage to individuals older than 64, under 200% of poverty, who are not insured for pharmaceuticals, and would require premiums. The modification specifies that the new program is not an entitlement and is limited by revenue and appropriations. (Sec. 1695)
9. Medicaid Fee-for-Service Provider Increases. The Conference Committee includes language specifying that increases for hospital services be distributed as a outpatient fee adjustor payment proportional to a hospital's Medicaid and indigent patient volume, with separate and equivalent adjustor pools for rural and urban hospitals. There is also language specifying that fee increases for physician services be distributed to primary care practitioners who serve a disproportionate share of Medicaid patients. (Secs. 1697, 1699)

Date Completed: 6-10-99 - Fiscal Analysts: P. Graham, S. Angelotti, J. Walker