No. 42695 (New Rule): Rule R30-2. Adjudicative Procedures

(New Rule)

DAR File No.: 42695
Filed: 03/15/2018 03:05:45 PM

RULE ANALYSIS

Purpose of the rule or reason for the change:

The purpose of this rule is to outline the administrative hearings procedures the Office of the Inspector General (OIG) uses to ensure fair hearings.

Summary of the rule or change:

Rule R30-2 outlines the processes the OIG will use when an administrative hearing is requested by a Medicaid provider. This process differs from processes used in the past in that it outlines a settlement process by which both parties can reach an agreement prior to the case going to hearing.

Statutory or constitutional authorization for this rule:

• Subsection 63G-3-201(2)
• Section 63A-13-603

Anticipated cost or savings to:

the state budget:

The OIG does not think that there is a fiscal cost or benefit to the state budget with this new rule. The OIG under the old Rule R30-1 consulted with and worked closely with state government(s) that had any interaction with Medicaid funds. OIG does not think that the relationship and/or time spent with these state government(s) will increase or decrease as a result of this new proposed rule. (EDITOR'S NOTE: The proposed repeal of Rule R30-1 is under Filing No. 42658 in this issue, April 1, 2018, of the Bulletin.)

local governments:

Local governments fiscal cost is $1,400 annually. The OIG identified one area of which the rule may have a direct fiscal cost. The nature of OIG is such that the OIG does not conduct regular business (i.e. reviews) with any one specific local government but does conduct work on an as needed basis. Just because the office has worked with a local government in the past is not necessarily an indicator that the Office will work with them in the future. As such, for our analysis, the OIG gathered data from 07/01/2015 through 12/31/2017, and combined services into two groups that have an impact in local governments (mental and behavioral health services). These services are broken into these groups as it would be effective to report them as a group rather than selecting the top local governments. Of the data pulled, local governments accounted for 4.24% of the total Medicaid claims reviewed and less than 1% of the total dollar amount identified on those claims. Cost: The one piece that may have a direct fiscal costs is during what OIG calls the review process. Under both the old and new rule, a provider is given the opportunity for a hearing. Historically, of the notices of recoveries sent (i.e. notice telling a provider that a reimbursement of Medicaid funds is needed), the OIG has scheduled around 159 annually. During the hearing process, under the old rule, a provider had the opportunity to discuss their side of the story during the hearing. If after this discussion, an agreement could not be reached, then it was sent before our Administrative Law Judge to make the final decision. The same process is followed in the new rule, but a provider now has the ability to request an agency review. This adds an additional step in the mediation process. Based upon this, the OIG estimated that although there isn�t a lot of additional work that would need to take place at the provider level, it may result in a few employee hours being spent by the provider. The OIG believe that the process would cost a provider $200 more. When conducting the calculation, the OIG used the $200 and allocated it across the estimated hearings as if each provider would request an agency review. The OIG does not think that will take place, but for purposes of estimating conservatively, the OIG has calculated it as such. With this calculation, the OIG then multiplied it by the percentage of claims reviewed as identified.

small businesses:

Small businesses fiscal cost is $14,399 annually. The OIG identified two areas of which the rule may have a direct fiscal cost or benefit. The nature of OIG is such that the OIG does not conduct regular business (i.e. reviews) with any one specific small business but does conduct work on an as needed basis. Just because the office has worked with a small business in the past is not necessarily an indicator that the OIG will work with them in the future. As such, for the analysis, the OIG gathered data from 07/01/2015 through 12/31/2017, and combined services into six groups that have an impact on small businesses (rehabilitation, doctors, dentist, pharmacy, therapy, and the sixth group has been combined which is made up of nursing homes, laboratories, and home health). These services are broken into these groups as it would be more effective to report them as a group rather than selecting the five top small businesses. Also, note that these groups have been listed in the order of which we identified as higher dollar value verses the number of providers that fall into each category. Of the data pulled, small businesses accounted for 45.65% of the total Medicaid claims reviewed and 5.01% of the total dollar amount identified on those claims. Cost: The one piece that may have a direct fiscal costs is during what OIG calls the review process. Under both the old rule (R30-1) and the new rule (R30-2), a provider is given the opportunity to a hearing. Historically, of the notices of recoveries sent (i.e. notice telling a provider that a reimbursement of Medicaid funds is needed), the OIG has scheduled around 159 annually. During the hearing process, under the old rule, a provider had the opportunity to discuss their side of the story during the hearing. If after this discussion, an agreement could not be reached, then it was sent before the Administrative Law Judge to make the final decision. The same process is followed in the new rule, but a provider now has the ability to request an agency review. This adds an additional step in the mediation process. Based upon this OIG estimates that although there isn�t a lot of additional work that would need to take place at the provider level, it may result in a few employee hours being spent by the provider. The OIG believes that the process would cost a provider $200 more. Note, when conducting the calculation, the OIG used the $200 and allocated it across the estimated hearings as if each provider would request an agency review. The OIG does not think that will take place, but for purposes of estimating conservatively, the OIG has calculated it as such. With this calculation, OIG then multiplied it by the percentage of claims reviewed as identified.

persons other than small businesses, businesses, or local governmental entities:

The OIG does not believe there is a cost or benefit to other "persons" associated with this new rule.

Compliance costs for affected persons:

The OIG does not believe there will be a compliance cost associated with the implementation of this rule since Medicaid providers already comply with the provisions of this rule through contracts with Medicaid.

Comments by the department head on the fiscal impact the rule may have on businesses:

The fiscal impacts identified in this analysis are costs already associated with the hearing process OIG has used since its inception in 2011.

Gene Cottrell, Inspector General

The full text of this rule may be inspected, during regular business hours, at the Office of Administrative Rules, or at:

Administrative Services
Inspector General of Medicaid Services (Office of)
288 N 1460 W
Salt Lake City, UT 84116

Direct questions regarding this rule to:

• Gene Cottrell at the above address, by phone at 801-538-6856, by FAX at 801-538-6382, or by Internet E-mail at [e-mail]
• Nathan Johansen at the above address, by phone at 801-538-6455, by FAX at 801-538-6382, or by Internet E-mail at [e-mail]

Interested persons may present their views on this rule by submitting written comments to the address above no later than 5:00 p.m. on:

05/01/2018

This rule may become effective on:

05/15/2018

Authorized by:

Gene Cottrell, Inspector General

RULE TEXT

Appendix 1: Regulatory Impact Summary Table*

FY 2018

FY 2019

FY 2020

Fiscal Costs

State Government

$0

$0

$0

Local Government

$1400

$1400

$1400

Small Businesses

$14,399

$14,399

$14,399

Non-Small Businesses

$16,000

$16,000

$16,000

Other Persons

$0

$0

$0

Total Fiscal Costs:

$31,799

$31,799

$31,799

Fiscal Benefits

State Government

$0

$0

$0

Local Government

$0

$0

$0

Small Businesses

$0

$0

$0

Non-Small Businesses

$0

$0

$0

Other Persons

$0

$0

$0

Total Fiscal Benefits:

$0

$0

$0

Net Fiscal Benefits:

($31,799)

($31,799)

($31,799)

 

*This table only includes fiscal impacts that could be measured. If there are inestimable fiscal impacts, they will not be included in this table. Inestimable impacts for State Government, Local Government, Small Businesses and Other Persons are described in the narrative. Inestimable impacts for Non-Small Businesses are described in Appendix 2.

 

Appendix 2: Regulatory Impact to Non-Small Businesses

Non-small business fiscal cost is $16,000 annually. The OIG identified two areas of which the rule may have a direct fiscal cost or benefit. The nature of the OIG is such that the OIG does not conduct regular business (i.e. reviews) with any one specific non-small business but do conduct work on an as needed basis. Just because the OIG has worked with a large business in the past, is not necessarily an indicator that the OIG will work with them in the future. As such for the analysis, the OIG gathered data from 07/01/2015 through 12/31/2017, and combined services into five groups that have an impact on non-small business (hospitals, psychiatry, behavioral health, hospice, and medical equipment and services). These services are broken into these groups as it would be more effective to report that as a group rather than selecting the five top large businesses. Also note that these groups have been listed in the order of which the OIG identified as higher dollar value verses the number of providers that fall into each category. Of the data pulled, small businesses accounted for 50.11% of the total Medicaid claims reviewed and 94.98% of the total dollar amount identified on those claims. Cost: the one piece that may have a direct fiscal costs is during what the OIG calls the review process. Under both the old Rule R30-1 and the new Rule R30-2, a provider is given the opportunity to a hearing. Historically of the notices of recoveries sent (i.e. notice telling a provider that a reimbursement of Medicaid funds is needed), the OIG has scheduled around 159 annually. During the hearing process, under the old Rule R30-1, a provider had the opportunity to discuss their side of the argument during the hearing. If after this discussion, an agreement could not be reached, then it was sent before our Administrative Law Judge to make the final decision. The same process is followed in the new Rule R30-2, but a provider now has the ability to request an agency review. This adds an additional step in the mediation process. Based upon this the OIG estimated that, although there isn't a lot of additional work that would need to take place at the provider level, it may result in a few employee hours being spent by the provider. The OIG therefore, believes that the process would cost a provider $200 extra. Note when conducting the calculation, the OIG used the $200 and allocated it across the estimated hearings as if each provider would request an agency review. The OIG does not think that will take place, but for purposes of estimating conservatively, the OIG has calculated it as such. With this calculation, the OIG then multiplied it by the percentage of claims reviewed as identified in our non-small business section.

 

The Inspector General, Gene D. Cottrell, has reviewed and approved this fiscal analysis.

 

 

R30. Administrative Services, Office of Inspector General of Medicaid Services.

R30-2. Adjudicative Procedures.

R30-2-1. Purpose.

The purpose of this rule is to describe the procedures to be followed in adjudicative proceedings handled by the office.

 

R30-2-2. Authority.

This rule is authorized by Section 63A-13-602 and Title 63G, Chapter 4.

 

R30-2-3. Definitions.

Terms used in this rule are defined in Section 63A-13-102, in addition:

(1) "agency action" means an adjudicative proceeding initiated by the office under Title 63G, Chapter 4 against a provider, including a:

(a) recovery action seeking repayment of division funds from a provider; or

(b) payment suspension action under Section 63A-13-205 or 42 CFR Section 455.23; and

(2) "ALJ" means an impartial administrative law judge who has been appointed by the inspector general to conduct an adjudicative proceeding according to these rules.

 

R30-2-4. Agency Action.

(1) When the office determines a division payment made to a provider was incorrect or that a provider's payments from the division should be suspended, the office may file a notice of agency action pursuant to Section 63G-4-201.

(2) The notice of agency action and any other documents associated with the agency action shall be mailed by first class postage to the provider's mailing address on file with the department unless the provider notifies the office in writing of an alternative physical or email address to be used for the adjudicative proceedings.

(3) An agency action initiated by the office shall be an informal adjudicative proceeding under Section 63G-4-202.

(4) Unless otherwise provided by these rules, the rules regarding the calculation of time found in Rule 6 of the Utah Rules of Civil Procedure shall be applicable to an action.

(5) After the initiation of an agency action, the ALJ may issue an order of default against a provider pursuant to Section 63G-4-209 if the ALJ finds a provider:

(a) fails to appear or participate in any step of the adjudicative process; or

(b) unreasonably prolongs the adjudicative process without good cause.

 

R30-2-5. Request for Agency Review.

(1) If a provider disagrees with the findings contained in a notice of agency action, a provider may file a written request for review within thirty days from the date of the notice of agency action.

(2) The request for review shall be filed with the office and include:

(a) a fully completed "Request for Review" form provided with the notice of agency action;

(b) a copy of the notice of agency action sent by the office; and

(c) a detailed explanation of why the provider is seeking review.

(3)(a) A request for review shall be considered filed on the date it is received by the office as indicated by the date and time:

(i) hand-delivered to the office;

(ii) of the postmark if it is mailed; or

(iii) logged on an email or fax.

(b) If the postmark date is illegible, erroneous, or omitted, the request for review shall be considered filed on the date the office receives it, unless the provider can demonstrate through competent evidence it was mailed before the date of receipt.

(4)(a) If a provider does not request review in a recovery action, a provider shall repay the money sought to be recovered in the notice of agency action within 30 days.

(b) A provider may repay money to the division by:

(i) sending in a check to the address listed in the notice of recovery;

(ii) contacting the office to arrange for a credit adjustment; or

(iii) voiding the original claim paid by the division.

(c) If a provider has not repaid the division within 60 days from the date of the notice of recovery, the office shall issue a final order and request the division initiate a credit adjustment in the amount listed on the notice of recovery.

(5) If a provider does not request review in a payment suspension action, the suspension shall become effective on the date indicated in the notice of suspension.

(6)(a) If a provider does not object to the remedy requested in the notice of agency action after having requested review, the provider may send a withdrawal of the request for hearing to the office.

(b) In response to the provider's withdrawal of the request for hearing, the office shall enter a final order closing the case and canceling any further proceedings.

 

R30-2-7. Review Process.

(1)(a) If a provider requests review of an agency action initiated by the office, the matter shall be set for a settlement conference between the parties.

(b) The purpose of the settlement conference is to give the parties an opportunity to discuss the issues in the case and attempt to resolve the matter without a hearing.

(2) If the parties are able to resolve the matter, the office shall memorialize the resolution reached in writing and send a copy to the provider.

(3)(a) If after negotiation, the parties are unable to resolve the matter, a party may request the matter be set for a prehearing conference with the ALJ.

(b) The purpose of the prehearing with the ALJ is to set the matter for hearing.

(4) A party may be represented by counsel in the agency review process and at a hearing.

 

R30-2-8. Hearing.

(1) Hearings before the ALJ shall be governed by the procedures in Section 63G-4-203.

(2)(a) A provider may have access to relevant information contained in the office's files the office intends to use in an action as provided in Title 63G, Chapter 2.

(b) A provider's right to discovery is limited and does not extend to interrogatories, requests for admissions, requests for the production of documents, requests for the inspection of items, or depositions.

(c) Subpoenas and orders to secure the attendance of witnesses or the production of evidence may be issued by the ALJ when requested by a party or on the ALJ's own motion.

(3) At the conclusion of a hearing, the ALJ shall issue a final order as provided in Section 63G-4-203.

 

R30-2-9. Reconsideration.

(1) A party may seek reconsideration of the ALJ's decision pursuant to Section 63G-4-302.

(2) If a party files a request for reconsideration with the office, the inspector general shall review the request for reconsideration, along with the ALJ's decision, and may:

(a) uphold the ALJ's decision;

(b) reject the ALJ's decision or any portion of the decision, and make an independent determination based upon the record; or

(c) remand the matter to the ALJ to obtain additional evidence and issue a new decision.

(3)(a) The decision of the Inspector General constitutes final administrative action and is subject to judicial review.

(b) The Inspector General shall send a copy of the final decision to each party , which includes notice of the parties' right to judicial review and the time limits for filing an appeal.

 

KEY: Office of the Inspector General of Medicaid Services; adjudicative procedures

Date of Enactment or Last Substantive Amendment: 2018

Authorizing, and Implemented or Interpreted Law: 63A-13, 63G-4

---