[Federal Register Volume 73, Number 250 (Tuesday, December 30, 2008)]
[Notices]
[Pages 79884-79885]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: E8-31019]


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DEPARTMENT OF HEALTH AND HUMAN SERVICES

Centers for Medicare & Medicaid Services


Notice of Hearing: Reconsideration of Disapproval of Washington 
State Plan Amendment (SPA) 08-002

AGENCY: Centers for Medicare & Medicaid Services (CMS), HHS.

ACTION: Notice of Hearing.

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SUMMARY: This notice announces an administrative hearing to be held on 
February 5, 2009, at the CMS Seattle Regional Office, 2201 Sixth 
Avenue, MS/RX-43, Seattle, Washington 98121 to reconsider CMS' decision 
to disapprove Washington SPA 08-002.
    Closing Date: Requests to participate in the hearing as a party 
must be received by the presiding officer by January 14, 2009.

FOR FURTHER INFORMATION CONTACT: Benjamin Cohen, Presiding Officer, 
CMS, 2520 Lord Baltimore Drive, Suite L, Baltimore, Maryland 21244, 
Telephone: (410) 786-3169.

SUPPLEMENTARY INFORMATION: This notice announces an administrative 
hearing to reconsider CMS' decision to disapprove Washington SPA 08-002 
which was submitted on January 7, 2007, and disapproved on September 
26, 2008. The SPA proposed to add a methodology to the State plan that 
would be used in the event that a contract with Regional Support 
Network to provide mental health services under a managed care delivery 
system to the State of Washington was not continued.
    Federal regulations at 42 CFR 430.20 and 447.205, are issued under 
the authority of general statutory requirements concerning methods of 
administration at section 1902(a)(4)(A) of the Social Security Act (the 
Act) and specific requirements at section 1902(a)(30)(A) concerning 
methods and procedures relating to payments to providers. These 
regulations require that public notice of changes in statewide methods 
and standards for setting payment rates be published in either a State 
register or the newspaper of widest circulation in the State (if there 
is not a city with a population of at least 50,000). In addition, they 
specify that the notice must be published before the effective date of 
the State plan.
    Washington did not provide public notice which complied with 
Federal regulations at 42 CFR 447.205. Although, beginning in December 
of 2007, the State held meetings with providers to inform them of what 
would be proposed via SPA 08-002, it did not provide the notice 
required by Federal regulations at 42 CFR 447.205 until February 20, 
2008. As a result, the State was informed the effective date of this 
plan could be no earlier than February 21, 2008. However, Washington 
failed to make this required change.
    Pursuant to Federal regulations at 42 CFR 430.10, which is 
authorized by section 1902(a)(4) of the Act and implements the general 
requirements of section 1902(a) of the Act for a State plan, a State 
plan must provide sufficient information to describe the nature and 
scope of the State program and to provide a basis for Federal financial 
participation. And, Federal regulations at 42 CFR 441.252(b), which 
implement in part provider payment provisions under section 
1902(a)(30)(A) of the Act, require that the State plan include a 
comprehensive description of the methods and standards used to set 
payment rates. The proposed SPA did not meet these requirements because 
the payment methodologies were not understandable and auditable. CMS 
requested further information about the factors Washington used to set 
its rates, and how the payment methodologies would be administered, but 
the State failed to provide sufficient responsive information to assure 
us that providers and auditors could determine whether correct payments 
had been made. Absent this information, CMS cannot determine that the 
requirements under section 1902(a) of the Act have been met.
    Based on the above, and after consultation with the Secretary of 
the Department of Health and Human Services as required under Federal 
regulations at 42 CFR 430.15(c)(2), CMS disapproved Washington SPA 08-
002.
    The hearing will involve the following issues:

     Whether the proposed effective date for the SPA was 
consistent with the limitations authorized under the requirements of 
sections 1902(a)(4)(A) and 1902(a)(30)(A) of the Act relating to 
methods of administration generally and methods and procedures for 
payment rates specifically, and the implementing regulations at 42 
CFR 430.20 and 42 CFR 447.205, which require advance public notice 
of changes in payment rates before a State plan amendment can become 
effective. The State's proposed effective date for the SPA was 
earlier than the date of the publication of the public notice that 
the State submitted in support of the SPA.
     Whether Washington provided adequate documentation to 
document the proposed payment rates and to demonstrate that the 
proposed rates were consistent with efficiency and economy as 
required by section 1902(a)(30)(A) of the Act. Specifically, the 
State proposed the use of actuarially developed rates that included 
a range of rates as opposed to a single dollar amount. The State 
indicated that the single dollar amount was developed from the above 
mentioned rate range, however, they were not able to provide either 
the dollar amount or the documentation regarding the construction of 
the single rate.

    Section 1116 of the Act and Federal regulations at 42 CFR Part 430, 
establish Department procedures that provide an administrative hearing 
for reconsideration of a disapproval of a State plan or plan amendment. 
CMS is required to publish a copy of the notice to a State Medicaid 
agency that informs the agency of the time and place of the hearing, 
and the issues to be considered. If we subsequently notify the agency 
of additional issues that will be considered

[[Page 79885]]

at the hearing, we will also publish that notice.
    Any individual or group that wants to participate in the hearing as 
a party must petition the presiding officer within 15 days after 
publication of this notice, in accordance with the requirements 
contained at 42 CFR 430.76(b)(2). Any interested person or organization 
that wants to participate as amicus curiae must petition the presiding 
officer before the hearing begins in accordance with the requirements 
contained at 42 CFR 430.76(c). If the hearing is later rescheduled, the 
presiding officer will notify all participants.
    The notice to the State of Washington announcing an administrative 
hearing to reconsider the disapproval of its SPA reads as follows:
    Ms. Robin Arnold-Williams, Secretary, Department of Social and 
Health Services, P.O. Box 45010, Olympia, WA 98504-5010.

Dear Ms. Arnold-Williams:

    I am responding to your request for reconsideration of the decision 
to disapprove the Washington Medicaid State plan amendment (SPA) 08-
002, which was submitted on January 7, 2008, and disapproved on 
September 26, 2008. The SPA proposed to add a methodology to the State 
plan that would be used in the event that a contract with Regional 
Support Network to provide mental health services under a managed care 
delivery system to the State of Washington was not continued.
    The issues to be considered at the hearing are:
     Whether the proposed effective date for the SPA was 
consistent with the limitations imposed by applicable appropriations 
statutes on the availability of funding for SPAs, the requirements of 
sections 1902(a)(4)(A) and 1902(a)(30)(A) of the Social Security Act 
(the Act) relating to methods and procedures generally and for payment 
rates specifically, and the implementing regulations at 42 CFR 430.20 
and 42 CFR 447.205--which require advance public notice of changes in 
payment rates. The State's proposed effective date for the SPA was 
earlier than the date of the publication of the public notice that the 
State submitted in support of the SPA.
     Whether Washington provided adequate documentation to 
document the proposed payment rates and demonstrate that the proposed 
rates were consistent with efficiency and economy as required by 
section 1902(a)(30)(A) of the Act. Specifically, the State proposed the 
use of actuarially developed rates that included a range of rates as 
opposed to a single dollar amount. The State indicated that the single 
dollar amount was developed from the above mentioned rate range, 
however, they were not able to provide either the dollar amount or the 
documentation regarding the construction of the single rate.
    I am scheduling a hearing on your request for reconsideration to be 
held on February 5, 2009, at the Centers for Medicare & Medicaid 
Services Seattle Regional Office, 2201 Sixth Avenue, MS/RX-43, Seattle, 
Washington 98121, in order to reconsider the decision to disapprove SPA 
08-002. If this date is not acceptable, we would be glad to set another 
date that is mutually agreeable to the parties. The hearing will be 
governed by the procedures prescribed by Federal regulations at 42 CFR 
Part 430.
    I am designating Mr. Benjamin Cohen as the presiding officer. If 
these arrangements present any problems, please contact the presiding 
officer at (410) 786-3169. In order to facilitate any communication 
which may be necessary between the parties to the hearing, please 
notify the presiding officer to indicate acceptability of the hearing 
date that has been scheduled and provide names of the individuals who 
will represent the State at the hearing.

     Sincerely,
Kerry Weems,
Acting Administrator.

    Section 1116 of the Social Security Act (42 U.S.C. section 1316; 42 
CFR section 430.18).

(Catalog of Federal Domestic Assistance program No. 13.714, Medicaid 
Assistance Program.)

    Dated: December 22, 2008.
Kerry Weems,
Acting Administrator, Centers for Medicare & Medicaid Services.
[FR Doc. E8-31019 Filed 12-29-08; 8:45 am]
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