TITLE 1. ADMINISTRATION

PART 15. TEXAS HEALTH AND HUMAN SERVICES COMMISSION

CHAPTER 355. REIMBURSEMENT RATES

SUBCHAPTER J. PURCHASED HEALTH SERVICES

DIVISION 4. MEDICAID HOSPITAL SERVICES

1 TAC §355.8061

The Texas Health and Human Service Commission (HHSC) adopts amended §355.8061, concerning Outpatient Hospital Reimbursement. The amended rule is adopted without changes to the proposed text published in the November 4, 2016, issue of the Texas Register (41 TexReg 8695).

BACKGROUND AND JUSTIFICATION

Section 355.8061 describes the reimbursement methodology for outpatient hospital services, including outpatient hospital imaging. Under this methodology, outpatient hospital imaging services for all hospitals except rural hospitals are reimbursed a percentage of the Medicare fee schedule, with reimbursements capped at 125 percent of the Medicaid adult acute care fee for a similar service. For the purpose of this rule, rural hospitals are defined as hospitals located in a county with 60,000 or fewer persons according to the 2010 U.S. Census as well as Medicare-designated Rural Referral Centers, Sole Community Hospitals, and Critical Access Hospitals.

Prior to September 1, 2015, rural hospital outpatient imaging services were reimbursed under the same methodology as non-rural hospital outpatient imaging services. Effective September 1, 2015, the 2016 - 2017 General Appropriations Act (Article II, Health and Human Services Commission, House Bill 1, 84th Legislature, Regular Session, 2015, Special Provisions Relating to all Health and Human Services Agencies, Section 58) directed HHSC to expend additional funds to provide modifications to Medicaid outpatient provider reimbursements for rural hospitals to ensure access to critical services. To comply with Section 58, among other actions, §355.8061 was amended to set rural hospital outpatient imaging services reimbursements equal to non-rural hospital reimbursements plus various add-on payments. This change was estimated to increase rural hospital outpatient imaging reimbursements by approximately $1.4 million all funds per annum.

HHSC reviews fees for imaging services at least once every two years by comparing existing Texas Medicaid fees to fees paid under Medicare. The most recent review of these fees indicated that Medicare fees for imaging services are lower now than they were when Medicaid fees were last adjusted. As a result, under HHSC's existing imaging services reimbursement methodologies, imaging fees should be reduced for acute care services which would, in turn, result in reductions to any hospital outpatient imaging service fee where the current fee is greater than 125 percent of the new acute care fee. Such reductions would reduce rural hospital outpatient imaging services reimbursements by approximately $1.0 million all funds per annum, largely negating the increase in the fees funded through Section 58 of the appropriations special provisions.

In order to preserve the increased rural hospital outpatient imaging funding authorized under Section 58, the amended rule establishes a new reimbursement methodology for rural hospital outpatient imaging services. Under the new methodology, rural hospital imaging fees will be based on a percentage of the Medicare Outpatient Prospective Payment System (OPPS) fee schedule, which will de-link the rural hospital fees from the acute care and non-rural hospital fees. This change will allow HHSC to exclude rural hospital outpatient imaging fees from reductions to acute care and non-rural hospital imaging fees.

COMMENTS

The 30-day comment period ended December 5, 2016. During this period, HHSC did not receive any comments regarding the amended rule.

STATUTORY AUTHORITY

The amended rule is adopted under Texas Government Code §531.033, which authorizes the Executive Commissioner of HHSC to adopt rules necessary to carry out HHSC's duties; Texas Human Resources Code §32.021 and Texas Government Code §531.021(a), which provide HHSC with the authority to administer the federal medical assistance (Medicaid) program in Texas; and Texas Government Code §531.021(b), which establishes HHSC as the agency responsible for adopting reasonable rules governing the determination of fees, charges, and rates for medical assistance payments under the Texas Human Resources Code, Chapter 32.

The agency certifies that legal counsel has reviewed the adoption and found it to be a valid exercise of the agency's legal authority.

Filed with the Office of the Secretary of State on January 11, 2017.

TRD-201700146

Karen Ray

Chief Counsel

Texas Health and Human Services Commission

Effective date: January 31, 2017

Proposal publication date: November 4, 2016

For further information, please call: (512) 462-6239