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Agenda 09/23/2014 Item #16D239/23/2014 16.D.23. EXECUTIVE SUMMARY Recommendation to approve four agreements to allow participation in Low Income Pool program; two between the County and Agency for Health Care Administration, and one each between the County and Naples Community Hospital and County and Physicians Regional Hospital. The County's total financial commitment is up to $2,400,300. OBJECTIVE: To provide additional health services for the low- income citizens of Collier County. CONSIDERATIONS: The Agency for Health Care Administration (AHCA) is a State entity that provides Medicaid services in Florida and operates the Medicaid Low Income Pool (LIP) program. The LIP program leverages local funds to obtain Federal matching dollars. Physicians Regional Hospital and Naples Community Hospital desire and are qualified to participate in the LIP program with AHCA using County tax dollars. By participating in this program, Collier County's contribution of $2,400,300 on behalf of the two hospitals will result in an additional $3,535,160 in Federal funds that will be utilized to provide healthcare services for low- income individuals in Collier County. The allocation of County and matching funds is shown in the table below and has been agreed to by each of the hospitals: *Matches based on most recent formulas ** Per the program, the entire amount of Medicaid funding is provided to the hospitals In addition to these agreements with AHCA, the County will also have separate agreements with the David Lawrence Center (DLC) and the Collier County Department of Health (DOH) . The hospitals also have voluntary arrangements to fund the DLC and the DOH. On December 11, 2012, Agenda Item No. 16D18 the Board approved an agreement with DLC that is scheduled to renew in December 2014. At a subsequent meeting, staff will bring forth an amendment to that agreement to provide for modified performance measures and modified billing procedures to be effective for the first quarterly billing due in January 2015. On October 14, 2014, staff will present an agreement with the Collier County DOH to the Board for consideration. FISCAL IMPACT: The total amount of $ 2,400,300 presently includes a $1,154,200 remittance for the David Lawrence Center and a $1,246,100 remittance for the County Health Department. These two remittances are budgeted in the FY 15 General fund (001) and are committed to the Intergovernmental Transfer (IGC) program under discussion. Packet Page -2930- c County IGT Commitment AHCA Total ** ( "not to exceed" in the Matching agreements) Funds* Naples Community $1,370,738 $2,018,822 $3,389,560 Hospital Physicians Regional $1,029,562 $1,516,338 $2,545,900 Medical Center Total $2,400,300 $3,535,160 $5,935,460 *Matches based on most recent formulas ** Per the program, the entire amount of Medicaid funding is provided to the hospitals In addition to these agreements with AHCA, the County will also have separate agreements with the David Lawrence Center (DLC) and the Collier County Department of Health (DOH) . The hospitals also have voluntary arrangements to fund the DLC and the DOH. On December 11, 2012, Agenda Item No. 16D18 the Board approved an agreement with DLC that is scheduled to renew in December 2014. At a subsequent meeting, staff will bring forth an amendment to that agreement to provide for modified performance measures and modified billing procedures to be effective for the first quarterly billing due in January 2015. On October 14, 2014, staff will present an agreement with the Collier County DOH to the Board for consideration. FISCAL IMPACT: The total amount of $ 2,400,300 presently includes a $1,154,200 remittance for the David Lawrence Center and a $1,246,100 remittance for the County Health Department. These two remittances are budgeted in the FY 15 General fund (001) and are committed to the Intergovernmental Transfer (IGC) program under discussion. Packet Page -2930- c 9/23/2014 16.D.23. LEGAL CONSIDERATIONS: This item has been reviewed by the County Attorney. Substantially identical arrangements have been in place for the past few years. In May 2014, the Center for Medicare and Medicaid Services (CMS), a division of the Federal Department of Health and Human Services that administers the Medicaid/Medicare programs, issued a bulletin (back -up to this item) that puts the proposed arrangement in question. This is a complex area of regulatory law in which the proposed arrangement falls within a gray area. Attorneys for each hospital have opined that the proposed arrangements are allowable under the CMS bulletin. The County Attorney has required Legal Opinion letters from both hospitals as a condition of moving forward with this item (there is an October 1' deadline, so the matter cannot be continued). If this Office does not receive these Opinion Letters prior to Tuesday's Board meeting, the County Attorney will pull this item from the agenda. In addition to the Opinion Letters, the County Attorney has required that the hospitals indemnify the County should CMS raise any issue with the arrangement. In such event, the hospitals (and the hospitals alone) will bear the risk that CMS will reduce their Federal Medicaid funding. With these safeguards in place, and in light to the benefits to the public, the County Attorney has approved this item as to form and legality. This item requires majority vote for approval. —JAK GROWTH MANAGEMENT IMPACT: There is no growth management impact associated with this executive summary. RECOMMENDATION: To approve and authorize the Chair to sign four agreements to allow for participation in the Low Income Pool programs, and to authorize any necessary budget amendments. Prepared by: Kimberley Grant, Director, Housing, Human and Veteran Services Packet Page -2931- 9/23/2014 16.D.23. COLLIER COUNTY Board of County Commissioners Item Number: 16.16.D.16.D.23. Item Summary: Recommendation to approve four agreements to allow participation in Low Income Pool program; two between the County and Agency for Health Care Administration, and one each between the County and Naples Community Hospital and County and Physicians Regional Hospital. The County's total financial commitment is up to $2,400,300. Meeting Date: 9/23/2014 Prepared By Name: AlonsoHailey Title: Operations Analyst, Public Services Division 9/15/2014 4:29:11 PM Submitted by Title: Director - Housing, Human and Veteran S, Housing, Human & Veteran Services Name: GrantKimberley 9/15/2014 4:29:12 PM Approved By Name: AlonsoHailey Title: Operations Analyst, Public Services Division Date: 9/17/2014 1:26:26 PM Name: Bendisa Marku Title: Supervisor - Accounting, Housing, Human & Veteran Services Date: 9/17/2014 1:29:57 PM Name: BelpedioJennifer Title: Assistant County Attorney, CAO General Services Date: 9/17/2014 2:05:44 PM Name: CarnellSteve Title: Administrator - Public Services, Public Services Division Date: 9/17/2014 2:32:17 PM Packet Page -2932- 9/23/2014 16.D.23. Name: RobinsonErica Title: Accountant, Senior, Grants Management Office Date: 9/17/2014 2:56:27 PM Name: BelpedioJennifer Title: Assistant County Attorney, CAO General Services Date: 9/17/2014 3:17:47 PM Name: KlatzkowJeff Title: County Attorney, Date: 9/18/2014 8:45:01 AM Name: IsacksonMark Title: Director -Corp Financial and Mngmt Svs, Office of M Date: 9/18/2014 9:14:36 AM Name: OchsLeo Title: County Manager, County Managers Office Date: 9/18/2014 10:03:15 AM Packet Page -2933- 9/23/2014 16.D.23. LIP 6 Letter of Agreement THIS LETTER OF AGREEMENT (LOA) made and entered into in duplicate on the day of 2014, by and between Collier County (the County) on behalf of Physician's Regional Medical Center, and the State of Florida, through its Agency for Health Care Administration (the Agency), 1. Per House Bill 5001, the General Appropriations Act of State Fiscal Year 2014 -2015, passed by the 2014 Florida Legislature, County and the Agency, agree that County will remit to the State an amount not to exceed a grand total of $1,029,562. Please note this amount may include credits from prior year's IGT reconciliations (a breakdown can be found below). The LOA's original amount prior to credits was $1,362,791. a. The County and the Agency have agreed that these funds will only be used to increase the provision of health services for the Medicaid, uninsured, and underinsured people of the County and the State of Florida at large. b. The increased provision of Medicaid, uninsured, and underinsured funded health services will be accomplished through the Low Income Pool (LIP) Program. 2. The County will pay the State an amount not to exceed the grand total amount of $1,029,562. The County will transfer payments to the State in the following manner: a. The first quarterly payment of $257,389 for the months of July, August, and September is due upon notification by the Agency. b. Each successive payment of $257,391 is due as follows, November 30, 2014, March 31, 2015 and May 25, 2015. c. The State will bill the County when each quarterly payment is due. 3. Timelines: This agreement must be signed, submitted, and received by the Agency no later than October 1, 2014 for all providers listed on Table 2a of the House Bill 5001 in order to be effective for SFY 2014 -2015. Should funding not be secured by October 1, 2014 the Agency will execute with other local governmental entities by October 31, 2014. House Bill 5001 Specific Appropriation 212 language is as follows: In order for the agency to certify the qualified nonfederal share of matching funds, a local governmental entity must submit a final, executed letter of agreement to the agency, which must be received by October 1, 2014 and provide the total amount of nonfederal share of matching funds authorized by the entity under this paragraph or the General Appropriations Act. If Table 2a funds are not secured by October 1, 2014, the Agency for Health Care Administration may execute letters of agreement with other local governmental entities by October 31, 2014. 4. Attached is the LIP 6 schedule reflecting the anticipated annual distributions for State Fiscal Year 2014 -2015. Packet Page -2934- G 9/23/2014 16.D.23. 5. The County and the State agree that the State will maintain necessary records and supporting documentation applicable to Medicaid, uninsured, and underinsured health services covered by this LOA. Further, the County and State agree that the County shall have access to these records and the supporting documentation by requesting the same from the State. 6. The County and the State agree that any modifications to this LOA shall be in the same form, namely the exchange of signed copies of a revised LOA. 7. The County confirms that there are no pre- arranged agreements (contractual or otherwise) between the respective counties, taxing districts, and /or the providers to re- direct any portion of these aforementioned Medicaid supplemental payments in order to satisfy non - Medicaid, non- uninsured, and non - underinsured activities. 8. The County agrees the following provision shall be included in any agreements between the County and local providers where funding is provided for the Medicaid program. Funding provided in this agreement shall be prioritized so that designated funding shall first be used to fund the Medicaid program (including LIP) and used secondarily for other purposes. 9. This LOA covers the period of July 1, 2014 through June 30, 2015 and shall be terminated June 30, 2015. IGTs Needed Prior to Credits $1,362,791 SFY 1213 IGT Rec Credits $333,229 SFY 1314 IGT Rec Credits _ 0 WITNESSETH: IN WITNESS WHEREOF the parties have duly executed this LOA on the day and year above first written. Collier County Tom Henning, Chairman ATTEST. DWIGHT E. BROCK. Clerk By: State of Florida Stacey Lampkin Assistant Deputy Secretary for Medicaid Finance, Agency for Health Care Administration Packet Page -2935- Approved as to form and legality Assistant County Attorney c,� 9/23/2014 16.D.23. LIP 6 Letter of Agreement THIS LETTER OF AGREEMENT (LOA) made and entered into in duplicate on the day of 2014, by and between Collier County (the County) on behalf of Naples Community Hospital, and the State of Florida, through its Agency for Health Care Administration (the Agency), 1. Per House Bill 5001, the General Appropriations Act of State Fiscal Year 2014 -2015, passed by the 2014 Florida Legislature, County and the Agency, agree that County will remit to the State an amount not to exceed a grand total of $1,370,738. Please note this amount may include credits from prior year's IGT reconciliations (a breakdown can be found below). The LOA's original amount prior to credits was $2,369,133. a. The County and the Agency have agreed that these funds will only be used to increase the provision of health services for the Medicaid, uninsured, and underinsured people of the County and the State of Florida at large. b. The increased provision of Medicaid, uninsured, and underinsured funded health services will be accomplished through the Low Income Pool (LIP) Program. 2. The County will pay the State an amount not to exceed the grand total amount of $1,370,738. The County will transfer payments to the State in the following manner: a. The first quarterly payment of $342,683 for the months of July, August, and September is due upon notification by the Agency. b. Each successive payment of $342,685 is due as follows, November 30, 2014, March 31, 2015 and May 25, 2015. c. The State will bill the County when each quarterly payment is due. 3. Timelines: This agreement must be signed, submitted, and received by the Agency no later than October 1, 2014 for all providers listed on Table 2a of the House Bill 5001 in order to be effective for SFY 2014 -2015. Should funding not be secured by October 1, 2014 the Agency will execute with other local governmental entities by October 31, 2014. House Bill 5001 Specific Appropriation 212 language is as follows: In order for the agency to certify the qualified nonfederal share of matching funds, a local governmental entity must submit a final, executed letter of agreement to the agency, which must be received by October 1, 2014 and provide the total amount of nonfederal share of matching funds authorized by the entity under this paragraph or the General Appropriations Act. If Table 2a funds are not secured by October 1, 2014, the Agency for Health Care Administration may execute letters of agreement with other local governmental entities by October 31, 2014. 4. Attached is the LIP 6 schedule reflecting the anticipated annual distributions for State Fiscal Year 2014 -2015. Packet Page -2936- 9/23/2014 16.D.23. 5. The County and the State agree that the State will maintain necessary records and supporting documentation applicable to Medicaid, uninsured, and underinsured health services covered by this LOA. Further, the County and State agree that the County shall have access to these records and the supporting documentation by requesting the same from the State. 6. The County and the State agree that any modifications to this LOA shall be in the same form, namely the exchange of signed copies of a revised LOA. 7. The County confirms that there are no pre - arranged agreements (contractual or otherwise) between the respective counties, taxing districts, and /or the providers to re- direct any portion of these aforementioned Medicaid supplemental payments in order to satisfy non - Medicaid, non - uninsured, and non - underinsured activities. 8. The County agrees the following provision shall be included in any agreements between the County and local providers where funding is provided for the Medicaid program. Funding provided in this agreement shall be prioritized so that designated funding shall first be used to fund the Medicaid program (including LIP) and used secondarily for other purposes. 9. This LOA covers the period of July 1, 2014 through June 30, 2015 and shall be terminated June 30, 2015. IGTs Needed Prior to Credits $2,369,134 SFY 1213 IGT Rec Credits $120,220 SFY 1314 IGT Rec Credits $878,176 WITNESSETH: IN WITNESS WHEREOF the parties have duly executed this LOA on the day and year above first written. Collier County State of Florida Tom Henning, Chairman Stacey Lampkin Assistant Deputy Secretary for Medicaid Finance, Agency for Health Care Administration ATTEST: Approved as to form and legality DWIGHT E. BROCK, Clerk By: Assistant County Attorney Packet Page -2937- 9/23/2014 16.D.23. DEPARTMENT OF HEALTH & HUMAN SERVICES — - Centers for Medicare &Medicaid Services 7500 Security Boulevard, Mail Stop S2 -26 -12 CMS Baltimore, Maryland 21244 -1850 CENTERS FOR MEDICARE & MEDICAID SERVICES CENTER FOR MEDICAID & CHIP SERVICES SNML #14 -004 May 9, 2014 RE: Accountability #2: Financing and Donations Dear State Medicaid Director: This letter is the second in a series that provides guidance on mutual obligations and accountability on the part of state and Federal governments for the integrity of the Medicaid program and the development, application and improvement of program safeguards necessary to ensure proper and appropriate use of both Federal and state dollars.' It provides guidance to states concerning Federal statute and regulations related to the allowable and unallowable use of provider- related donations and also addresses the use of certain types of public - private arrangements; such as Low - Income and Needy Care Collaboration Agreements (LINCCAs), Collaborative Endeavor Agreements (CEAs), and Public - Private Partnerships. These arrangements generally involve Medicaid supplemental payments or special add -ons to the base payment rate that are contingent upon or otherwise related to agreements between government and private entities under which the private entities assume obligations to provide donated services or other transfers of value as directed in the arrangements. CMS understands that partnerships and other relationships between governmental and private entities are often beneficial and can further the organizational goals of the businesses or entities involved. Such relationships may be contractual agreements to provide the state agency with goods and services for a fair market price arrived at through a state's procurement process (such as contracts for accounting services, landscaping services, management services, or supplies). Such relationships could also involve grant programs in which governmental agencies provide funding to private entities to pursue common public objectives, for example, fair market lease agreements. Nothing in this letter is intended to limit the ability of governments and businesses to establish these normal and important business relationships. This letter only discusses situations where governmental entities and private entities enter into agreements or relationships that constitute non -bona fide provider- related donations, in which private entities provide a governmental entity with funds or other consideration and receive in return additional Medicaid payments typically in the form of a supplemental payment. Government entities are free to enter into agreements with private entities; however such agreements may affect the allowability of Medicaid funding if there is a hold harmless provision or practice. A hold harmless practice exists if there is a positive correlation between the agreement and the Medicaid payments, Medicaid payments are conditioned upon the receipt of a donation from a private entity, or if there is a guarantee that the private entity will see a return of some, or all, of that donation through a Medicaid payment. In cases where contracts and 1 The first letter, SMDL #13 -003, is available at h=: / /www.medicaid.eov /Federal - Policy- Guidance /Downloads /SMD -13- 003- 02.pdf. Packet Page -2938- 9/23/2014 16.D.23. Page 2 — State Medicaid Director agreements do not directly or indirectly affect Medicaid base or supplemental payments, however, CMS generally would not consider these agreements as a barrier to approving a state plan amendment (SPA) or waiver. As explained in more detail below, these arrangements raise issues relating to private donations and could potentially result in a hold harmless arrangement under which the donations are returned in full or in part to the provider or provider class. Donations that occur under such arrangements are not considered bona fide, and, as explained further below, the Centers for Medicare & Medicaid Services (CMS) will not approve SPAs that include non -bona fide donations as a portion, or all, of the non - Federal share of the Medicaid payments. Payment methodologies contingent upon the receipt of a non -bona fide donation would also be grounds for disapproval of a SPA. Background Provider - Related Donations Federal regulations at 42 Code of Federal Regulations (CFR) 433.52, which implement section 1903(w) of the Social Security Act (the Act), define a provider related donation as "a donation or other voluntary payment (in cash or in kind) made directly or indirectly to a state or unit of local government by or on behalf of a health care provider, an entity related to such a health care provider, or an entity providing goods or services to the state for administration of the state's Medicaid plan." Regulations at 42 CFR 433.54(a) define a bona fide donation as "a provider- related donation ... that has no direct or indirect relationship ... to Medicaid payments made to (1) the health care provider; (2) any related entity providing health care items and services; or (3) other providers furnishing the same class of items or services as the provider or entity." As set forth at 42 CFR 433.54(b) and (c), this does not include donations that are part of a hold harmless arrangement that directly or indirectly returns some or all of the donation to the provider, the provider class, or any related entity. Section 1903(w)(1)(A) of the Act states that "notwithstanding the previous provisions of this section, for purposes of determining the amount to be paid to a state (as defined in paragraph (7)(D)) under subsection (a)(1) for quarters in any fiscal year, the total amount expended during such fiscal year as medical assistance under the state plan (as determined without regard to this subsection) shall be reduced by the sum of any revenues received by the state (or by a unit of local government in the state) during the fiscal year —(i) from provider- related donations (as defined in paragraph (2)(A)), other than - (I) bona fide provider - related donations (as defined in paragraph (2)(B)), and (11) donations described in paragraph (2)(C)." Because this provision indicates that Federal Medicaid payments must be reduced by the sum total of non -bona fide provider - related donations received by the state, state plans that rely on, or reference, non -bona fide provider - related donations would result in claims for Federal funding that would not be allowable. Also, supplemental payments supported by such donations would be unallowable because there is no valid source of the non - Federal share. Therefore, CMS will not approve such state plan amendments. Packet Page -2939- 9/23/2014 16.D.23. Page 3 — State Medicaid Director Base and Supplemental Payments to Providers Section 1902(a)(30) of the Act requires that states "assure that payments are consistent with efficiency, economy, and quality of care and are sufficient to enlist enough providers so that care and services are available under the plan at least to the extent that such care and services are available to the general population in the geographic area." In addition to other considerations, CMS requires states to submit upper payment limit (UPL) calculations to demonstrate that payments to Medicaid providers are economical and efficient and that both base and supplemental payments are within the UPL. Under 42 CFR 447.272 and 42 CFR 447.321, Medicaid payments for inpatient hospital, outpatient hospital, clinic, nursing facility, and ICF /IID services are limited to a reasonable estimate of the amount that Medicare would pay in the aggregate for each type of provider within three categories; state owned, non -state government owned, and privately owned. Payments that exceed this limit are considered out of compliance with the Federal statute and regulations described above. Consistent with the regulatory UPL requirements, states may pay classes of providers up to the specified aggregate UPL levels for that class. Many states pay providers up to these levels by making a combination of base and supplemental payments to specific providers. Supplemental payments are typically targeted to specific kinds of providers. For example, a targeted hospital might be a state designated safety -net provider, a hospital with high Medicaid utilization, or provide care at a higher level of quality than other providers in the state. In addition to the UPL requirements applied in the aggregate to classes of providers, CMS also reviews the reasonableness of fee - for - service payment rates to help ensure that payments are efficient and economical. Even if consistent with regulatory UPL requirements, CMS may question payment rates to particular providers that exceed usual and customary charges or other measures of reasonableness, absent clear justification that the higher rates benefit the Medicaid program. For example, CMS may question proposed payments to one or more providers that are orders of magnitude higher than payments to other providers of the same services. Public- Private Partnerships A public - private partnership arrangement is a relationship between a private entity and a government entity in which the private entity agrees, in some form, to provide a service or some other in -kind transfer of value to further the purposes of the government entity. In the context of the Medicaid program, some public - private arrangements also include provisions that the government entity will make an intergovernmental transfer (IGT) to the Medicaid agency, and the private providers that have signed, or otherwise entered into, an agreement would then become eligible for a Medicaid supplemental payment or special add -on to the base payment rate that may be funded by the IGT from the government entity under the same agreement. In some cases, the IGT is derived from funds that the government entity previously would have spent on providing the services that are now being provided by the private entity. These funds would not be available if not for the public - private partnership agreements. As described in further detail below, this type of arrangement would not be considered a bona fide donation under Medicaid requirements. Packet Page -2940- 9/23/2014 16.D.23. Page 4 — State Medicaid Director Many of the proposed partnerships that CMS examined focus on the delivery of non - Medicaid services to non - Medicaid eligible individuals. One such proposed arrangement involved a government agency, a non - profit organization, and a private hospital. Under the arrangement, a government entity (other than the Medicaid agency) contracted with a non - profit organization to provide employment training and transportation to places of employment for individuals with disabilities. Under the terms of the proposed public - private partnership arrangement between the private hospital and a local government entity, the local government entity would terminate its existing contract with the non - profit organization. The private hospital would then execute the same contract with the same non - profit organization. The local government entity would send an IGT to the Medicaid agency, in an amount approximately equal to the amount that it would have spent on the now terminated contract, which would trigger a supplemental payment under the proposed SPA. The supplemental payment would be directed to the private hospital that participates in public - private partnership arrangement. Under these circumstances, there is a hold harmless arrangement in which the contract to provide services is a provider - related donation and the receipt of supplemental payments is the return of some, or all, of the donation. As discussed below, this arrangement results in a non -bona fide donation and will not be approved by CMS unless claims for Federal Medicaid funding are reduced by the amount or value of the donation. In another example, a private hospital would enter into an arrangement with a government entity to lease space at an amount above fair market value as determined by an independent third party assessment. The lease payments from the private hospital would be used to fund the non - Federal share of Medicaid supplemental payments to a private hospital serving as the lessee of the government -owned space. This illustration implies that there is a transfer of value that, while it has the form of a normal business transaction, is conditioned on the return of excess payments through higher Medicaid payments. As discussed below, this arrangement results in a non -bona fide donation and cannot be approved by CMS unless claims for Federal Medicaid funding are reduced by the amount of the excess lease payments. Per section 1903(w) of the Act, provider donations that are part of hold harmless arrangements are not bona fide donations. Regardless of the expressed intent of providers and governmental entities, when there is an effective return of some, or all, of the donation to the private provider through Medicaid supplemental payments, a hold harmless arrangement exists. Any arrangement such as those described in this guidance that obligate a private hospital to either assume the programmatic responsibility of a unit of government or sign lease agreements at an amount that is greater than fair market value would be considered a hold harmless arrangement. The donation would not be considered bona fide when such arrangements are tied in any way, directly or indirectly, to Medicaid reimbursement under the Medicaid state plan. Additionally, supplemental payments or other forms of increased payments based on the arrangements described above raise concerns with the Medicaid program's requirement for payments to be consistent with economy, efficiency, and quality of care to the extent that the overall payment exceeds the amount payable to other providers of the same services. There are also concerns when higher Medicaid payments to providers do not appear related to the purchase of more expensive or higher quality services for beneficiaries, but instead appear simply to alleviate burdens on public entities from funding a non - Medicaid activity. As such, these Packet Page -2941- 9/23/2014 16.D.23. Page 5 — State Medicaid Director payments are not consistent with section 1902(a)(30)(A) of the Act because they are not economical and efficient. We distinguish these payments from those that simply recognize the higher cost structures of providers that consistently provide significant levels of uncompensated care. CMS reviews these situations on a case -by -case basis. Conclusion Contracts and arrangements with private entities can be a valid way for a state to provide Medicaid services. However, if a provider enters into a public - private partnership to provide non - Medicaid services, as described in this letter, and the provider receives as a direct result, additional Medicaid base or supplemental payment than might otherwise be received under the current approved state plan, CMS will consider this exchange in value of either cash or in -kind services by the private entity to the public entity to be a non -bona fide donation. Therefore, CMS will not approve any SPAs or waivers that include such an arrangement. If a SPA is, or has been, approved and an inappropriate funding arrangement is discovered post - approval, CMS may pursue corrective action to ensure that the state changes its practices, and may recover Federal Financial Participation (FFP) associated with these supplemental payments. CMS will not interfere with state business or the state's ability to engage in business transactions with private entities, except when such arrangements and business transactions include the promise of increased Medicaid payments contingent upon the signing of such agreements. CMS is obligated to review financial arrangements and Medicaid payments for consistency with Section 1903(w) and Section 1902(a) of the Act. We hope this guidance will help clarify for states what is authorized under the law. Our goal is to ensure that states have the information and support they need from CMS to promote flexibility while ensuring compliance with Federal statute and regulations. We expect that further consultations with states will lead to additional discussion regarding the appropriate application of these policies. Sincerely, /s/ Cindy Mann Director CC: CMS Regional Administrators CMS Associate Regional Administrators Division of Medicaid and Children's Health Operations Matt Salo President National Association of Medicaid Directors Packet Page -2942- Page 6 — State Medicaid Director 9/23/2014 16.D.23. Alan R. Weil, J.D., M.P.P. Executive Director National Academy for State Health Policy Ronald Smith Director of Legislative Affairs American Public Human Services Association Joy Wilson Director Health Committee National Conference of State Legislatures William Garner Legislative Director Committee on Health and Human Services National Governors Association Debra Miller Director for Health Policy Council of State Governments Christopher Gould Director Government Relations Association of State and Territorial Health Officials Packet Page -2943- 9/23/2014 16.D.23. [on hospital letterhead] September 17, 2014 Tom Henning, Chairman Collier County Board of Commissioners Collier County Government 3299 Tamiami Trail East Naples, FL 34112 Re: Indemnification Letter Agreement Dear Chairman Henning: Physicians Regional Medical Center ( "PRMC ") is aware that Collier County, pursuant to a Letter of Agreement ( "LOA ") with Florida's Agency for Health Care Administration ( "AHCA ") is intending to provide funds that may be used by AHCA as the non - federal share of Medicaid payments to PRMC. PRMC is greatly appreciative of any support provided by Collier County. The purpose of this Indemnification Letter Agreement is for PRMC to acknowledge that although PRMC does not believe the risk to be substantial, there could be some risk for Collier County providing the non - federal share. Thus, in acknowledgement of that risk, PRMC, to the maximum extent permitted by Florida law, shall indemnify and hold harmless Collier County against any claims, damages, losses, and expenses, including reasonable attorneys' fees and costs, arising out of or resulting from any failure by PRMC associated with Collier County's provision of funding to AHCA as the non - federal share of Medicaid payments to PRMC. This indemnification obligation shall not be construed to negate, abridge or reduce any other rights or remedies which otherwise may be available to Collier County. PRMC shall indemnify and hold harmless Collier County for all claims, demands, actions, suits, losses, costs, charges, expenses, damages and liabilities whatsoever which the County may pay, sustain, suffer or incur by reason of or in connection with Collier County's provision of funding to AHCA as the non- federal share of Medicaid payments to PRMC including payment of all legal costs, including but not limited to, attorney's fees paid by the County. Please acknowledge receipt of this Indemnification Letter Agreement by signing below and returning a copy to me. Sincerely, Scott Lowe, CEO Physicians Regional Medical Center ACKNOWLEDGED Tom Henning, Chairman, Board of County Commissioners for Collier County ATTESM DWIGHT E. BROCK, Clerk 82893466\V -3 By: Packet Page -2944- Approved as to form and legality Assistant County Attorney r\ 9/23/2014 16.D.23. [on hospital letterhead] September 17, 2014 Tom Henning, Chairman Collier County Board of Commissioners Collier County Government 3299 Tamiami Trail East Naples, FL 34112 Re: Indemnification Letter Agreement Dear Chairman Henning: Physicians Regional Medical Center ( "PRMC ") is aware that Collier County, pursuant to a Letter of Agreement ( "LOA ") with Florida's Agency for Health Care Administration ( "AHCA ") is intending to provide funds that may be used by AHCA as the non - federal share of Medicaid payments to PRMC. PRMC is greatly appreciative of any support provided by Collier County. The purpose of this Indemnification Letter Agreement is for PRMC to acknowledge that although PRMC does not believe the risk to be substantial, there could be some risk for Collier County providing the non - federal share. Thus, in acknowledgement of that risk, PRMC, to the maximum extent permitted by Florida law, shall indemnify and hold harmless Collier County against any claims, damages, losses, and expenses, including reasonable attorneys' fees and costs, arising out of or resulting from any failure by PRMC associated with Collier County's provision of funding to AHCA as the non - federal share of Medicaid payments to PRMC. This indemnification obligation shall not be construed to negate, abridge or reduce any other rights or remedies which otherwise may be available to Collier County. PRMC shall indemnify and hold harmless Collier County for all claims, demands, actions, suits, losses, costs, charges, expenses, damages and liabilities whatsoever which the County may pay, sustain, suffer or incur by reason of or in connection with Collier County's provision of funding to AHCA as the non - federal share of Medicaid payments to PRMC including payment of all legal costs, including but not limited to, attorney's fees paid by the County. Please acknowledge receipt of this Indemnification Letter Agreement by signing below and returning a copy to me. Sincerely, Scott Lowe, CEO Physicians Regional Medical Center ACKNOWLEDGED Tom Henning, Chairman, Board of County Commissioners for Collier County 82893466%V.3 ATTEST. DWIGHT E. BROCK, Clark By: Packet Page -2945- Approved as to form and legality Assistant County Attorney 9/23/2014 16.D.23. MASTER SERVICE AGREEMENT THIS MASTER SERVICE AGREEMENT (AGREEMENT)Js made and entered into this September 2014 by and between Collier County, Florida, a political subdivision of the State of Florida, hereinafter referred to as "the County" and Naples Community Hospital, Inc., a Florida not for profit corporation, hereinafter referred to as "the Hospital ". RECITALS: WHEREAS, Section 125.01(1)(e), Florida Statutes, authorizes the County to provide health welfare programs for the residents of Collier County to the extent not inconsistent with general or special law; and WHEREAS, the establishment and maintenance of such programs are in the common interest of the people of Collier County: and WHEREAS, the County desires the Hospital to become a Community Health partner to assist in providing management advice, coordination of care, and support for health prevention programs, and mental health services to residents of the County, where no existing state or federal resources are available; and WHEREAS, The Hospital desires to be a Community Health partner and is willing to voluntarily provide support and oversight for such services in an effort to reduce non- emergent emergency department utilization, subject to the terms and conditions hereinafter set forth. NOW THEREFORE, in consideration of the covenants herein contained, the parties; hereby agree as follows: ARTICLE I SERVICES TO BE PERFORMED 1. The Hospital shall provide documentation and quarterly reports to the County, that support Hospital's expenditures for the reimbursement to Collier partners as stated immediately below for the delivery of services, designated primary health care services, specialty health care services and other health care services including, but not limited to, the following services: a. Immunization program provided by the Collier County Health Department b. AIDS Prevention Program provided by the Collier County Health Department c. Tuberculosis Program provided by the Collier County Health Department d. Communicable Disease Program provided by the Collier County Health Department e. Child Health Program provided by the Collier County Health Department f. Healthy Start Prenatal Program provided by the Foundation for Women's Health g. School Health Program provided by the Collier County Health Department h. Adult Health Program provided by the Collier County Health Department L Dental Program provided by the Collier County Health Department. j. Community Mental Health Services provided by the David Lawrence Center, Inc. k. Other health related programs and services 2. The County and Hospital shall on a quarterly basis review the utilization of the services enumerated above and Hospital shall make suggested changes for improvement of the delivery and access to care and services provided. 1 2014 Agreement with Naples Community Hospital Packet Page -2946- 9 9/23/2014 16.D.23. ARTICLE II CLAIMS VALUATION AND CLAIMS PROCESSING 1. As the claims processing entity, the Hospital will provide quarterly financial reports to the County in such detail as required by the County. 2. As part of the claims processing entity, the Hospital will provide quarterly reports to the County with suggestions to improve access to services, to better coordinate care and services by and among providers, and to reduce emergency department utilization for non - emergent care. ARTICLE III TERMS OF AGREEMENT AND TERMINATION 1. The term of this Agreement shall be October 1, 2014 through September 30, 2015. 2. Either party may terminate this Agreement thirty (30) calendar days after receipt by the other party of written notice of intent to terminate. Upon breach of this Agreement, the aggrieved party may, by written notice of breach to the breaching party, terminate the whole or any part of this Agreement. Termination shall be upon no less than twenty -four (24) hours' notice, in writing, delivered by certified mail, facsimile, or in person. Waiver by either party of breach of any provisions of this Agreement shall not be deemed to be a waiver of any other or subsequent breach and shall not be construed to be a modification of the terms of this Agreement. ARTICLE IV ASSIGNMENT The Hospital and /or its sub - contractor shall not assign or transfer this Agreement, or any interest, right or duty herein, without the prior written consent of the County, which consent shall not be unreasonably withheld by the County. Without obtaining prior consent by the County, the Hospital shall be allowed to assign or transfer this Agreement or any of the Hospital's obligations hereunder to affiliates or wholly owned subsidiaries of the Hospital. This Agreement shall run to the County and its successors. ARTICLE V SUBCONTRACTING The parties agree that the Hospital shall be permitted to execute subcontracts for the purchase by the Hospital of such services, articles, supplies, and equipment, which is both necessary and incidental to the performance of the work, required under this Agreement. However, the Hospital expressly understands that it shall assume the primary responsibility for performing the services outlined in Article I of this Agreement. 2014 Agreement with Naples Community Hospital 9 Packet Page -2947- 9/23/2014 16.D.23. ARTICLE VI INSURANCE, SAFETY AND INDEMNIFICATION 1. Indemnity. To the maximum extent permitted by Florida law, the Hospital and /or its sub- contractor shall indemnify and hold harmless the County against any claims, damages, losses, and expenses, including reasonable attorneys' fees and costs, arising out of or resulting from the Hospital's failure to pay for services or performance under this Agreement. This Indemnification obligation shall not be construed to negate, abridge or reduce any other rights or remedies which otherwise may be available to an indemnified party or person described in this paragraph. Hospital shall jointly and severally indemnify and hold harmless Collier County for all claims, demands, actions, suits, losses, costs, charges, expenses, damages and liabilities whatsoever which the County may pay, sustain, suffer or incur by reason of or in connection with this agreement including payment of all legal costs, including but not limited to, attorney's fees paid by the County. 2. Insurance Required. During the term of this agreement the Hospital shall procure and maintain liability insurance coverage. The liability insurance coverage shall be in amounts not less than $1,000,000 per person and $2,000,000 per incident of occurrence for personal injury, death, and property damage or any other claims for damages caused by or resulting from the activities under this Agreement. Such policies of insurance shall name the County as an additional insured. The Hospital shall purchase all policies of insurance from a financially responsible insurer duly authorized to do business in the State of Florida. The Hospital shall be financially responsible for any loss due to failure to obtain adequate insurance coverage and the failure to maintain such policies or certificate in the amounts set forth herein shall constitute a breach of this agreement. ARTICLE VII BILLING PROCEDURES The County shall provide the Hospital with invoices pursuant to this Agreement once the County has verified the validity of the invoices to be paid by the Hospital. The Hospital will not pay any invoices prior to the County's approval. The Hospital shall make payments on a voluntary basis in the amount of $1,650,000 to specific healthcare programs and services, such as the mental health programs of the David Lawrence Center, specified health programs of the Collier County Health Department, and other social service providers that are pre- approved by the County for payment. The Hospital shall use reasonable efforts to pay invoices approved by the County within thirty (30) days of County approval. Payments shall be made in accordance with this Agreement irrespective of whether Hospital has received funds from AHCA. If the amount invoiced to Hospital does not result in the amount of $1,650,000 the Hospital will credit County for the difference and voluntarily make those payments to providers elected by County upon invoice by the County in Year 2015 -2016. ARTICLEVIII RECORDS 2014 Agreement with Naples Community Hospital Packet Page -2948- 9/23/2014 16.D.23. 1. The Hospital and /or its sub - contractor shall keep orderly and complete records of its accounts and operations related to the services provided under this Agreement for the entire term of the Agreement plus three (3) years. The Hospital and /or its sub - contractor shall keep open these records to inspection by County personnel at reasonable hours during the entire term of this Agreement. If any litigation, claim or audit is commenced prior to the expiration of the three (3) year period and extends beyond this period the records must remain available until any litigation, claim or audits have been resolved. Any person duly authorized by the County shall have full access to and the right to examine any of said records during said period. Access to PHI shall be in compliance with federal laws and HIPAA. ARTICLE IX CIVIL RIGHTS 1. There will be no discrimination against any employee or person served on account of race, color, sex, age, religion, ancestry, national origin, handicap or marital status in the performance of the Agreement. 2. It is expressly understood that, upon receipt of evidence of such discrimination, the County shall have the right to terminate this Agreement for breach of agreement. 3. The Hospital and /or its sub - contractor shall comply with Title VI of the Civil Rights Act of 1964 (42 USC 2000d) in regard to persons served. 4. The Hospital and /or its sub - contractor shall comply with Title VII of the Civil Rights Act of 1964 (42 USC 2000c) in regard to employees or applicants for employment. 5. The Hospital and /or its sub - contractor shall comply with Section 504 of the Rehabilitation Act of 1973 in regard to employees or applicants for employment and clients served. ARTICLE X OTHER CONDITIONS 1. Any alterations, variations, modifications or waivers of provision of this Agreement shall only be valid when they have been reduced to writing, duly signed and attached to the original of this Agreement. The parties agree to renegotiate the Agreement if revision of any applicable laws or regulations makes changes in the Agreement necessary. 2. This Agreement contains all the terms and conditions agreed upon by the parties. All items incorporated by reference are as though physically attached. No other agreements, oral or otherwise, regarding the subject matter of this Agreement, shall be deemed to exist or to bind any of the parties hereto. 3. The Hospital and /or its sub - contractor shall obtain and possess throughout the term of this Agreement all licenses and permits applicable to its operations under federal, state, and local laws, and shall comply with all fire, health and other applicable regulatory codes. 4. The Hospital and /or its sub - contractor agrees to comply with all applicable requirements and guidelines prescribed by the County for recipients of funds. 5. The Hospital and /or its sub - contractor agree to safeguard the privacy of information pursuant to the Health Insurance Portability and Accountability Act of 1996 (HIPAA). IN WITHNESS WHEREOF, the parties have executed this Agreement on the dates first written above. 4 2014 Agreement with Naples Community Hospital Packet Page -2949- -v ATTEST: DWIGHT E. BROCK, CLERK By: , DEPUTY CLERK Approval for form and legality: Jennifer A. Belpedio Assistant County Attorney �C�J� \N 2014 Agreement with Naples Community Hospital 9/23/2014 16.D.23. BOARD OF COUNTY COMMISSIONERS OF COLLIER COUNTY, FLORIDA By: 5 TOM HENNING CHAIRMAN NAPLES COMMUNTIY HOSPITAL, INC., A FLORIDA NOT FOR PROFIT CORPORATION By: Title: 0 �7 Packet Page -2950-