‘Outliers’ beware: Medicaid transparency rule will track staff spending patterns

While a new Medicaid transparency rule for nursing homes doesn’t go as far as a similar measure dictating how home and personal care providers spend their money, data collected through new reporting requirements will likely lead to future changes.

Staff from the Centers for Medicare & Medicaid Services confirmed that widely held belief Tuesday during a Long Term Care Support and Services Open Door Forum conference call.

The provision falls short of a requirement in the Medicaid Access Rule — issued April 22, the same day as the skilled nursing staffing rule — that requires 80% of Medicaid payments for home care, personal care, and homemaker services to go toward direct care staff.

But it will likely still have an impact on spending patterns, after its planned implementation four years from now.

States will collect the data at a provider level, send it to CMS, and then CMS will publish it.

“We really viewed this institutional payment transparency requirement as a necessary step in gathering and making available more information about institutional payments, and we think that information can help to inform future policy development,” said Jennifer Bowdoin, with the CMS Medicaid Benefits and Health Programs group.

“Gathering and sharing this data about the percentage of Medicaid dollars that are going to worker compensation can help us, and it can help states identify ways that we can help to support the workforce and better address workforce shortages, including by identifying national trends,” she added. “It can help us to identify facilities that appear to be outliers in terms of the percent of Medicaid payments going to compensation.”

Bowdoin reminded attendees that payments for which Medicaid is not the primary payer will be excluded from the reporting, but beneficiary contributions to their care when Medicaid is the primary payer of the services will be included.

“We did this because we want the payments included in the reporting to be representative of the total payment amount a provider receives for the provision of Medicaid services to beneficiaries,” she said.

Another important clarification: Similar to the home- and community-based payment adequacy reporting requirements, CMS is excluding some critical costs from the calculation of the percent of Medicaid payments going to compensation.

“Specifically, we are excluding travel, training, and personal protective equipment costs from the calculation, and we did this because we think it recognizes the importance of those costs to quality of care and worker safety,” she said. “We believe that by excluding these costs from the calculation, it would help to ensure that nursing facilities and [facilities serving individuals with disabilities] continue to invest in these critical activities and items without the providers being concerned that these costs are going to count against their  spending on compensation to direct care workers and support staff.”