REPORT TITLE:
"Felix"; Medicaid
Reimbursement


DESCRIPTION:
Requires DOH, by 8/31/99, to develop: (1) service definitions for
mental health services for "Felix" class children that are
comparable to Medicaid definitions; (2) fee schedule and billing
codes comparable to Medicaid and QUEST.  Requires implementation
by 8/31/2000.  Report to legislature before convening of 2001
regular session.  (HB847 HD1)

 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
                                                        847
HOUSE OF REPRESENTATIVES                H.B. NO.           H.D. 1
TWENTIETH LEGISLATURE, 1999                                
STATE OF HAWAII                                            
                                                             
________________________________________________________________
________________________________________________________________


                   A  BILL  FOR  AN  ACT

RELATING TO MENTAL HEALTH SERVICES FOR FELIX CLASS CHILDREN.



BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF HAWAII:

 1      SECTION 1.  In December, 1998, the auditor issued a report
 
 2 entitled "Assessment of the State's Efforts Related to the Felix
 
 3 Consent Decree" which found the State lacking in several areas.
 
 4 One area was the failure to maximize federal matching
 
 5 reimbursements for mental health services for children covered in
 
 6 the consent decree.  The auditor reported that although
 
 7 approximately $3,200,000 in Medicaid reimbursement has been
 
 8 secured on behalf of the Felix class since fiscal year 1994-1995,
 
 9 maximization of this funding source has been impeded by long
 
10 standing obstacles that the department of health has failed to
 
11 address.
 
12      Medicaid provides matching funds to states for health care
 
13 including mental health services to eligible low-income
 
14 recipients.  In Hawaii, Medicaid is administered by the med-QUEST
 
15 division of the department of human services and is monitored by
 
16 the federal Health Care Financing Administration.  Some of the
 
17 covered Medicaid services are mental health services the State
 
18 provides under the Felix decree, and some members of the Felix
 
19 class are eligible for assistance through either fee-for-service
 

 
Page 2                                                     847
                                     H.B. NO.           H.D. 1
                                                        
                                                        

 
 1 Medicaid or QUEST, the State's managed care demonstration
 
 2 project.  Medicaid or QUEST funding can be used to help offset
 
 3 the cost of the decree to the extent they overlap with Felix
 
 4 services and individuals.
 
 5      The auditor suggested that the department of health take
 
 6 certain steps to overcome obstacles preventing optimal
 
 7 utilization of matching federal Medicaid and QUEST
 
 8 reimbursements.  Two of these steps are:
 
 9      (1)  To develop service definitions that are comparable to
 
10           Medicaid definitions of covered services; and
 
11      (2)  To develop a fee schedule comparable to the fee
 
12           schedule used for Medicaid and QUEST purposes.
 
13 For example, definitions used by the department of health do not
 
14 match Medicaid definitions for similar services.  One further
 
15 obstacle to maximizing federal reimbursement is that the
 
16 department of health paid more for mental health assessments
 
17 performed by contracted private providers than either Medicaid or
 
18 QUEST, thus creating a disincentive for private providers to bill
 
19 QUEST even though the QUEST plans were willing to accept claims
 
20 for reimbursement from these private providers.  Despite the fact
 
21 that the department of health's current contracts require
 
22 providers to charge the State rates that do not exceed usual and
 
23 customary reimbursements for Hawaii, rates actually paid by the
 

 
Page 3                                                     847
                                     H.B. NO.           H.D. 1
                                                        
                                                        

 
 1 department continue to exceed Medicaid reimbursement rates.  In
 
 2 addition, the lack of common definitions and billing codes makes
 
 3 it difficult for the department of health to bill Medicaid or
 
 4 QUEST for covered services.
 
 5      The purpose of this Act is to require the department of
 
 6 health to develop a fee schedule for the Felix class that
 
 7 corresponds to Medicaid standards, including comparable service
 
 8 definitions, billing codes, and reimbursement rates.
 
 9      SECTION 2.  (a)  No later than August 31, 1999, the
 
10 department of health, through the department's child and
 
11 adolescent mental health division, with the assistance and
 
12 cooperation of the department of human services, shall complete
 
13 the following tasks:
 
14      (1)  Develop service definitions for mental health services
 
15           provided to Felix class children that are comparable to
 
16           Medicaid definitions of similar covered services; and
 
17      (2)  Develop a fee schedule and billing codes comparable to
 
18           the fee schedule and billing codes used for Medicaid
 
19           and QUEST purposes.
 
20      (b)  The department of health shall develop the new
 
21 definitions, billing codes, and fee schedule by August 31, 1999,
 
22 and shall implement them in the new contracts issued after August
 
23 31, 2000.
 

 
Page 4                                                     847
                                     H.B. NO.           H.D. 1
                                                        
                                                        

 
 1      (c)  The department of health shall submit a report to the
 
 2 legislature and the governor no later than twenty days prior to
 
 3 the convening of the regular session of 2001 detailing
 
 4 information on the effectiveness and cost savings, if any, due to
 
 5 the implementation of the new definitions, billing codes, and fee
 
 6 schedule.
 
 7      SECTION 3.  This Act shall take effect upon its approval.