Hearing. The Texas Health and Human Services Commission (HHSC) will conduct a public hearing to receive public comment on proposed amendments to the administrative rule at Title 1 Texas Administrative Code (TAC) §355.8052. This section governs the payment methodology for Medicaid inpatient hospital reimbursement. HHSC will also receive comments during the public hearing on proposed rates developed as a result of these proposed rule amendments.

The hearing will be held in compliance with Texas Government Code §2001.029, which provides an opportunity for a public hearing, when requested, before adoption of a rule. The hearing will also be held in compliance with Human Resources Code §32.0282 and Title 1 of the TAC, §355.201(e) - (f), which require public notice and hearings when Medicaid reimbursement rates are proposed or adjusted.

Proposal. HHSC proposes to amend current §355.8052 to update the Medicaid inpatient hospital reimbursement methodology.  The 82nd Legislature amended the Government Code to add Chapter 536: Medicaid and Child Health Plan Programs: Quality-Based Outcomes and Payments. As amended, the Government Code requires HHSC, to the extent possible, to convert hospital reimbursement systems in Medicaid programs to a diagnosis-related groups (DRG) methodology that will allow HHSC to more accurately classify specific patient populations and account for severity of patient illness and mortality risk. HHSC is proposing to transition from the use of Medicare Severity Diagnosis Related Groups to the 3MTM All Patient Refined Diagnosis Related Groups (APR-DRG) for hospital inpatient reimbursement.

The APR-DRGs, through expanded diagnosis and procedure codes, will more appropriately reimburse Medicaid hospitals for the cost of providing Medicaid services. For state fiscal year 2013, the transition to the APR-DRG will require the statewide standard dollar amount (SDA) and existing add-ons to be rebased using fiscal year 2010 claims data to ensure that reimbursement to hospitals remains within available funds.  The proposed rates will be effective Sept. 1, 2012, and were determined in accordance with the rate setting methodologies listed below under “Methodology and Justification.”

Methodology and Justification. The payment rates were calculated in accordance with the proposed amended rule at 1 TAC §355.8052, which describes the reimbursement methodology for Medicaid Inpatient Hospital Services.  Note that the proposed amendment of §355.8052 was published in the June 15, 2012, issue of the Texas Register (37 TexReg 4295) with a Sept. 1, 2012, effective date.

Briefing Package.  A briefing package describing the proposed payment rates will be available at http://www.hhsc.state.tx.us/rad/rate-packets.shtml on or after July 16, 2012.  Those interested also may obtain a copy of the briefing package before the hearing by contacting Esther Brown by telephone at 512-491-1445; by fax at 512-491-1998; or by email at Esther.Brown@hhsc.state.tx.us.  The briefing package also will be available at the public hearing. 

Written Comments.  Written comments regarding the proposed payment rates may be submitted instead of, or in addition to, oral testimony until 5 p.m. the day of the hearing. Written comments may be sent by U.S. mail, overnight mail, special delivery mail, hand delivery, fax, or email:

U.S. Mail
Attention:  Esther Brown
HHSC Rate Analysis, Mail Code H-400
P.O. Box 85200
Austin, Texas 78708-5200

Overnight mail, special delivery mail or hand delivery
Attention:  Esther Brown
HHSC Rate Analysis, Mail Code H-400
Braker Center, Building H
11209 Metric Blvd.
Austin, Texas 78758-4021

Phone number for package delivery:  512-491-1445

Fax
Attention:  Esther Brown at 512-491-1998

E-mail
Esther.Brown@hhsc.state.tx.us