Medicaid Transformation Waiver
HHSC has received federal approval of a waiver that allows the state to expand Medicaid managed care while preserving hospital funding, provides incentive payments for health care improvements and directs more funding to hospitals that serve large numbers of uninsured patients.
Waiver Overview
The Texas Healthcare Transformation and Quality Improvement Program (the transformation waiver) allows the state to expand Medicaid managed care while preserving federal hospital funding historically received as Upper Payment Limit (UPL) payments—supplemental payments to make up the difference between what Medicaid pays for a service and what Medicare would pay for the same service. Replacing the UPL payment methodology are two funding pools – the Uncompensated Care and Delivery System Reform Incentive Payment (DSRIP) pools.
Uncompensated Care Pool Payments are designed to help offset the costs of uncompensated care provided by the hospital or other providers.
DSRIP Pool Payments are incentive payments to hospitals and other providers that develop programs or strategies to enhance access to health care, increase the quality of care, the cost-effectiveness of care provided and the health of the patients and families served.
Under the transformation waiver, eligibility to get Uncompensated Care or DSRIP payments will require participation in a regional healthcare partnership. Within a partnership, participants include governmental entities providing public funds known as intergovernmental transfers (IGT), Medicaid providers and other stakeholders. Participants will develop a regional plan identifying partners, community needs, the proposed projects, and funding distribution. Each partnership must have one anchoring entity, which acts as a primary point of contact for HHSC in the region and is responsible for seeking regional stakeholder engagement and coordinating development of a regional plan.
[Overview of Transformation Waiver Terminology]
Waiver Timeline
May 1, 2012 – All regional healthcare partnerships should be formed.
May 17, 2012 – Public hearing in Austin on final regional geography and anchors.
May 23, 2012 – Webinar / conference call on the draft Program Funding and Mechanics Protocol, HHSC’s draft DSRIP requirements.
June 7, 2012 – Public hearing on the Program Funding and Mechanics Protocol at 10 a.m. Central in the Brown Heatly Building Public Hearing Room at 4900 North Lamar Blvd., Austin, Texas. Details of the hearing will be posted on the HHSC Meetings and Events webpage.
Last week of June 2012 – Regional healthcare partnership planning summit in Austin to provide technical assistance on developing a regional plan. Due to limited space, online participation also will be available.
August 31, 2012 – HHSC must submit the finalized regions and DSRIP menu of projects and payment protocol to the federal Centers for Medicare and Medicaid Services (CMS).
September 1, 2012 – All regions must submit plans to HHSC.
October 31, 2012 – HHSC must submit final regional plans to CMS.
Outreach
May 23, 2012 Webinar / Conference Call, 3:30 p.m. - 5 p.m. Central – Overview Draft Program Funding and Mechanics Protocol
HHSC will review the draft Program Funding and Mechanics Protocol, the state’s working document for DSRIP requirements. For the webinar / conference call, participants can choose to login online or join only by phone. All participants will receive the same information and can participate in the questions-and-answers session.
To participate in the webinar:
- Go to www.webex.com
- Click on Attend Meeting
- Enter Meeting Number 805 606 709
- Call 1-866-861-7912
HHSC has hosted a series of webinars about a variety of topics, including regional healthcare partnership development and the DSRIP menu. Archived webinars
All questions concerning the transformation waiver can be submitted to TXHealthcareTransformation@hhsc.state.tx.us.
Background Resources
Regional Healthcare Partnerships Roles & Responsibilities
News Release on Waiver Approval
Federal Approval Letter and Documents (PDF)
Overview of Texas Health Care Transformation Waiver (PDF)
Budget Analysis (PDF)
Frequently Asked Questions
Former Upper Payment Limit Payments and Intergovernmental Transfers, Fiscal Year 2011
The following information is provided to aid development of regional healthcare partnerships by identifying the entities that provided intergovernmental transfers (IGT) and received Upper Payment Limit (UPL) payments in fiscal year 2011.
[Description of Data and Former UPL Program]
[UPL Payments with IGT in Fiscal Year 2011]
[Map of Participants in the Former UPL Program]
Tools and Guidelines for Regional Healthcare Partnership Participants
As outlined in the transformation waiver’s Special Terms and Conditions, in regional healthcare partnerships with a public hospital, the anchoring entity should be a public hospital. In partnerships without a public hospital, the following entities may serve as the anchor:
- A hospital district.
- A hospital authority.
- A county.
- A state university with a health science center or medical school.
Anchoring entities coordinate regional healthcare partnerships. They do not control participant IGT funding and cannot dictate conditions of another entity’s IGT plan. Each transferring entity with IGT funds determines how to use its own public funds within the parameters of the waiver requirements. Reimbursement for anchors’ allowable administrative expenses will require 50 percent match. HHSC is working with CMS to determine how an IGT entity can fund a performing provider in a different regional healthcare partnership based on certain principles, including that the total computable payment must stay with the recipient.
Overview of RHP Development Process
RHP Governance Overview (PDF) – Pending CMS approval.
RHP Principles (PDF)
Anchor list (PDF)
Preliminary RHP map (PDF) – May 11, 2012, map of preliminary regions based on RHP confirmation forms.
Planning Tools: Each regional healthcare partnership must submit a plan to HHSC by September 1, 2012. The following documents are intended to help with the planning process.
Community Data and Resources for Assessment of Needs (DOC)
IGT Guidelines (PDF)
Draft of Plan Template (PDF)
Hospitals by Proposed RHP (XLS)
HITECH Funding Available to Hospitals (DOC)
DRAFT DSRIP menu (XLS)
DSRIP Funding and Reporting Flow (PDF)
Draft Program Funding and Mechanics Protocol (PDF) – HHSC draft DSRIP requirements.
Program Funding and Mechanics Protocol Feedback Form (DOC) – Public comments are due to HHSC by May 30, 2012.
Proposed Rules
Proposed waiver reimbursement rules for hospitals and physician services are now available for viewing on the Texas Register website. The rules were published in the April 20, 2012, edition of the Texas Register, which began the 30-day comment period.
1 TAC §355.8066 (Hospital Specific Limit Methodology): The hospital specific limit methodology is used in the calculation of a hospital’s uncompensated-care waiver payments and disproportionate-share hospital program payments.
1 TAC §355.8201 (Waiver Payments to Hospitals)
1 TAC §355.8202 (Waiver Payments for Physician Services)
The preambles for each of the rules can be viewed by clicking on the “preamble” tab on the top left side of each posting.
1115 Transformation Waiver Workgroups
Executive Waiver Committee: This workgroup provides HHSC with feedback on the hospital finance component of the waiver. This feedback will help HHSC understand the potential impact of changes to hospital funding anticipated by the waiver and will help provide input on the feasibility of different implementation approaches for hospital funding under the waiver. HHSC also will seek broader public input as appropriate.
Executive Waiver Committee Members (PDF)
April 5, 2012 Meeting (PDF) Update on HHSC outreach, regional healthcare partnership development and the DSRIP menu.
Clinical Champions Workgroup: This workgroup will assist in the technical development of an initial draft DSRIP menu of projects, milestones and metrics. The members were nominated by healthcare associations and state universities. HHSC has contracted with the Texas Medical Foundation Quality Institute to facilitate the discussions and support the clinical and analytic bases for DSRIP development. HHSC expects to submit a final DSRIP menu to the federal Centers for Medicare and Medicaid Services by August 2012.
Members of this workgroup and their organizations are available. (PDF)