DMAS Announces Interim Rates

VHCA (6/6/2008)

Virginia nursing facilities participating in the Medicaid program should be receiving their new interim payment rates within the next few days.  The calculation of these rates are based upon the most recent settled cost report as of May 27, 2008.  Beginning today, providers may access a copy of their new rate calculation schedule in their GoFileRoom outgoing general correspondence file folder.

Due to the rebasing of the direct and indirect operating cost ceilings, the Department of Medical Assistance Services (DMAS) has calculated revised interim daily payment rates for all Medicaid participating facilities.  These new rates are effective for dates of service on or after July 1, 2008 and incorporate the 2008 cost inflator of 2.8 percent as well as a 1.329 percent reduction in the operating rate as a result of the General Assembly’s budget cut.

As announced by VHCA two weeks ago, the new cost ceilings are based on facility cost data as reported in fiscal year 2005 Medicaid cost reports.  The direct care ceiling is 117 percent of the day-weighted peer group median and the indirect ceiling is 107 percent of the day-weighted peer group median.  The cost ceilings have been adjusted for inflation to the provider’s current rate period.  The updated cost ceilings are available here.

Providers should keep in mind that these are interim rates.  Final rates for the time period starting July 1, 2008 through the end of the provider’s fiscal year will be based on the settled cost report on which rates for the period are based.  For example, rates for the period July 1, 2008 through December 31, 2008 for a December 31 year-end provider will be based upon cost contained within the settled fiscal year 2007 cost report.

DMAS has provided VHCA with a file containing interim July 1, 2008 rates.  Based upon preliminary analysis using 2006 cost report data containing the most recent facility-specific Medicaid days by provider available, the weighted average statewide Medicaid rate in effect as of July 1st is $141.91. 

Providers with questions about their interim rate calculation should contact Jim Branham (804.225.4587) or Jim Worrell (804.786.1009) at DMAS.