Current through Reg. 49, No. 38; September 20, 2024
(a) Introduction. The Texas Health and Human
Services Commission (HHSC) uses the methodology described in this section to
establish Nursing Facility (NF) Liability Insurance Coverage Rate
Add-ons.
(b) Definitions.
(1) Provider--A person who has a written
agreement with HHSC to provide Medicaid NF services to an individual or a
person who is contracted with a managed care organization as defined in §
RSA 353.2 of this
title (relating to Definitions) to provide Medicaid NF services.
(2) Independently procured insurance--An
insurance transaction involving an insurance contract independently procured
from an insurance company not licensed in Texas through negotiations occurring
entirely outside the state of Texas that is reported and on which premium tax
is paid.
(3) Open enrollment
period--Open enrollment period begins on the first day of July and ends on the
last day of that same July preceding the rate year for which payments are being
determined.
(4) Purchased captive
insurance--General or professional liability insurance purchased from a
non-admitted captive insurance company that insures solely directors and
officer's liability insurance for the directors and officers of the company's
parent and affiliated companies and the risks of the company's parent and
affiliated companies, if applicable.
(5) Purchased commercial liability
insurance--Either general or professional liability insurance from a commercial
carrier or a non-profit service corporation in an arm's-length transaction that
provides for the shifting of risk to the unrelated party. The commercial
carrier or non-profit service corporation must meet the requirements as set by
the Texas Department of Insurance (TDI) for authorized insurance.
(6) Rate year--The rate year begins on the
first day of September and ends on the last day of August of the following
year.
(7)
Self-insurance--Self-insurance is a means whereby a provider undertakes the
risk to protect itself against anticipated liabilities by providing funds
equivalent to liquidate those liabilities. If a provider enters into an
arrangement with an unrelated party that does not provide for the shifting of
risk to the unrelated party, such an agreement shall be considered
self-insurance. Self-insurance is not purchased liability insurance.
(c) Eligibility. To be eligible to
receive and retain liability insurance coverage rate add-ons from HHSC under
this section:
(1) the provider must be
enrolled as a Medicaid provider;
(2) the provider must be actively providing
and billing for NF services provided to Medicaid clients; and
(3) the provider must maintain acceptable
liability insurance coverage as described in this section during the rate year
for which the liability insurance add-ons will be paid.
(d) Payment rates. Payment rates for
purchased general and professional liability insurance will be determined as
follows.
(1) Determine the portion of the
general and administration rate component from §
RSA
355.307 of this subchapter (relating to
Reimbursement Setting Methodology) attributable to allowable liability
insurance costs.
(2) Determine the
amount of total dollars that would be expended if the liability rate component
from paragraph (1) of this subsection were paid uniformly to all providers
during the rate effective period.
(3) Estimate the number of days of service
that will be covered by purchased liability insurance during the rate
period.
(4) Divide the total
dollars available for liability insurance from paragraph (2) of this subsection
by the estimated number of days of service that will be covered by purchased
liability insurance during the rate period from paragraph (3) of this
subsection. Estimate the proportion of this per diem amount accruing from
general liability insurance and the proportion accruing from professional
liability insurance to determine the payment rate for each day of purchased
general liability insurance and the payment rate for each day of purchased
professional liability insurance.
(5) Payment rates for purchased general and
professional liability insurance may be adjusted as often as HHSC determines is
necessary to ensure that the total dollars expended during the rate period do
not exceed the amount appropriated for this purpose.
(6) Since these payment rates are determined
through an allocation of available appropriations among estimated units of
service covered by purchased liability insurance, a public rate hearing is not
required when adjustments are made to the payment rates.
(7) Providers will be notified, in a manner
determined by HHSC, of adjustments to the payment rates for purchased general
and professional liability insurance.
(8) Providers who purchase general liability
insurance without professional liability insurance are only eligible to receive
payment of the rate for purchased general liability insurance. Providers who
purchase professional liability insurance without general liability insurance
are only eligible to receive payment of the rate for purchased professional
liability insurance. Providers who purchase both general and professional
liability insurance are eligible to receive payment of both rates.
(e) Open enrollment. Each rate
year, HHSC notifies providers of open enrollment for providers to receive the
liability insurance rate add-ons via email sent to an authorized representative
per the signature authority designation form applicable to the provider's
contract or ownership type. If open enrollment has been postponed or canceled,
HHSC will notify providers by email before the first day of the open enrollment
period. Should conditions warrant, HHSC may conduct additional enrollment
periods during a rate year. A provider must submit an attestation in accordance
with subsection (f) of this section during an open enrollment period to receive
the liability rate add-ons for each rate year. The HHSC Provider Finance
Department must receive the attestation by the last day of the open enrollment
period. If the last day of open enrollment is on a weekend day, state holiday,
or national holiday, the HHSC Provider Finance Department must receive the
attestation by the next business day. A provider who fails to submit an
acceptable attestation of agreement in accordance with this section will not
receive the add-on rates during the rate year.
(f) Attestation of agreement. The provider
must submit an electronic attestation of agreement to comply with subsection
(c)(3) of this section during the open enrollment period prior to the rate year
the liability insurance add-ons will be paid. The electronic attestation will
include the following.
(1) The provider must
indicate that it is carrying general liability and professional liability
insurance; general liability insurance without professional liability
insurance; or professional liability insurance only.
(2) The provider must attest that it has
purchased liability insurance issued through an entity meeting any one of the
following criteria. These entities have been determined by the TDI to be
authorized to issue liability insurance policies in the State of Texas.
(A) An insurance company identified as an
admitted, licensed insurer authorized to write liability insurance in Texas.
This type of insurance company is designated as "active" on the TDI website.
This designation includes risk retention groups chartered inside the State of
Texas.
(B) An insurance company
that is an eligible surplus lines insurer which requires that there be a Texas
licensed surplus lines agent placing the coverage with the insurance company.
This type of insurance company is designated as "eligible" on the TDI
website.
(C) The Texas Medical
Liability Insurance Underwriting Association (JUA). This insurance arrangement
is designated as "active" on the TDI website.
(D) A risk retention group chartered outside
the State of Texas that is registered with the TDI and which is designated as
"registered" on the TDI website.
(3) The provider must attest that if it
purchased independently procured insurance, the coverage was purchased through
an independently procured insurance arrangement. The provider must also attest
that taxes on the premiums of independently procured insurance were paid to and
received by the Texas Comptroller for the calendar year in which the policy was
procured, continued or renewed.
(4)
The provider must agree that if it purchased insurance through a captive
insurance company that taxes on the premiums of captive insurance were paid to
and received by the Texas Comptroller for the calendar year in which the policy
was procured, continued or renewed.
(5) The provider must attest that it has not
obtained insurance from an insurer or person engaged in unauthorized insurance
as set forth in Chapter 101 of the Texas Insurance Code, Unauthorized
Insurance.
(g) Failure
to maintain insurance coverage. It is the provider's responsibility to notify
the HHSC Provider Finance Department of any changes to liability insurance
coverage during a rate year for which liability insurance rate add-ons are
being paid, including cancellation of, or failure to renew or to maintain
coverage, within 15 calendar days of the effective date of the change. Failure
to notify HHSC Provider Finance Department of cancellation of or failure to
renew or maintain coverage could constitute Medicaid fraud and the rate add-on
amounts paid for a period during which liability insurance is not maintained
will be subject to recoupment under subsection (j) of this section.
(h) New provider contracts. For the purposes
of this section, a new provider contract is a contract with an effective date
on or after the first day of the open enrollment period for that rate year. To
receive the liability insurance add-on rates, a provider with a new provider
contract must send a written request to complete the attestation of agreement
in subsection (f) of this section to the HHSC Provider Finance Department. The
attestation of agreement must be completed according to instructions, signed by
an authorized agent of the provider's contract, and received by the HHSC
Provider Finance Department within 30 days of the date HHSC sends notification
to the provider that the attestation of agreement must be completed. If the
30th day is on a weekend day, state holiday, or national holiday, the HHSC
Provider Finance Department must receive the attestation by the next business
day. A provider who fails to submit an acceptable attestation of agreement in
accordance with this section will not receive the add-on rates during the rate
year.
(i) Change of ownership.
Payment of liability insurance add-on rate confers to the new owner as defined
in 26 TAC § 554.2308(relating to Change of Ownership) when there is a
change of ownership. If the change of ownership occurs during an open
enrollment period as defined in subsection (b) of this section, then the owner
recognized by HHSC, or its designee, may request to modify the enrollment
status of the facility by the last day of the enrollment period, in accordance
with subsection (e) of this section.
(j) Recoupment. HHSC will recoup add-on rates
paid to a provider under the following circumstances.
(1) It is the responsibility of the provider
to ensure that liability insurance is authorized. Liability insurance payments
will be recouped if made on insurance that is later determined by TDI to be
unauthorized insurance under Chapter 101, Texas Insurance Code. The liability
insurance payments that were recouped will be returned to the provider if the
determination by TDI that the insurance is unauthorized is successfully
appealed with TDI and the insurance is determined to be authorized.
(2) It is the responsibility of the provider
to ensure that liability insurance coverage is maintained during a rate year
for which liability insurance rate add-ons are paid. Failure to maintain
coverage will result in recoupment of funds for any period in which add-ons
were paid and liability insurance coverage was not maintained.
(3) It is the responsibility of the provider
to ensure that its attestation of liability insurance coverage is accurate.
False attestations will result in recoupment of funds for the rate year
following the open enrollment in which the false attestation was made.
