Agenda 07/24/2012 Item #11C7/24/2012 Item 11.C.
EXECUTIVE SUMMARY
Recommendation to review and provide direction to the County Manager or his designee regarding
the payment of Collier County's Medicaid backlog (retrospective bills).
OBJECTIVE: To receive direction for payment of the Medicaid backlog amount due from Collier
County.
CONSIDERATIONS: In 1972, the Florida Legislature created a mechanism to charge counties for a
portion of the state's Medicaid responsibility. During 2008, a new electronic billing system was
implemented by the Agency for Health Care Administration (AHCA). Collection of Medicaid payments
from the counties decreased due to increased disputes by the counties. Specifically, in Collier County,
these disputes include billings for patients that were not deemed to be residents of Collier County;
inadequate addresses that prohibited staff from verifying residency; and rebilling of claims determined
to have been paid by Collier County. The Certified amount includes billings from November 1, 2001
through March 31, 2012.
During the 2012 legislative session, the Legislature passed and the Governor signed HB 5301 (now Ch.
2012 -33, Laws of Florida) requiring the state to collect past disputed bills through an automatic
withholding from the county revenue sharing.
Rule development (59G- 1.025: Medicaid County Billing) for procedures to implement this unfunded
mandate began in June of 2012 and is still being finalized. On August 1, 2012, AHCA will certify to the
Department of Revenue (DOR) the final backlog amount remaining unpaid. AHCA provided a final
adjusted backlog amount July 13, 2012 which included details on the disposition of each disputed
claim. These disputed claims were adjusted according to direction provided by the Governor on July
12, 2012. The adjustments made included corrections for residency verifications, rebilling of claims
and credit for payments received. Should this proposed final amount prove to be different from the
actual certified amount issued on August 1, 2012, the Board will be notified.
Several considerations for the payment of Collier County's backlog amount resulting from the
retrospective bills are as follows:
1. Pay 100% of the certified backlog from AHCA; file a petition on or before September 1, 2012 to
challenge the amount certified; and proceed with an appeal.
2. Accept the certified backlog amount provided by AHCA and receive a 15% reduction to the
total certified amount.
3. Regardless of #1 or #2, the county has the option to pay all or part of the amount certified on
August 1, 2012 by September 13, 2012 to avoid reductions to the Revenue Sharing.
4. Beginning with the October 2012 distribution, the DOR will reduce the County's distribution
of Revenue Sharing for one -third of the outstanding certified amount.
5. With the October 2013 distribution, the DOR will reduce the County's Revenue Sharing
distributions by one - quarter oTthe then remaining balance. This will continue until FY 2017.
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7/24/2012 Item 11.C.
The following is a table depicting these financial impacts and options:
FY 2014 Beginning with October 2013, Revenue Sharing
Distribution will be reduced by one - quarter of
OPTION# 1
OPTION #2
OPTION #3
Do not
Challenge, Make
Do not Challenge
four years.
Partial Pymt. in
292,418
and Take 15%
Challenge and
FY12 and Take
Year Impact
Discount
Pay 100%
15% Discount
Certified Backlog amount at August 1, 2012
$ 2,064,126
$ 2,064,126
$ 2,064,126
Balance after 15% discount iftaken
1,754,507
2,064,126
1,754,507
FY2012 Make partial payment
-
-
800,000
Balance Beginning October 1, 2012
$ 1,754,507
$ 2,064,126
$ 954,507
FY 2013 Beginning with October 2012 Revenue Sharing
159,084
Total Fiscal Impact - FY 12 to FY 17
$
Distribution will be reduced by 1/3 of total
$
2,064,126
$
certified amount and deducted monthly
$ 584,836
$ 688,042
$ 318,169
FY 2014 Beginning with October 2013, Revenue Sharing
Distribution will be reduced by one - quarter of
the remaining balance and ammortized over
four years.
$
292,418
$
344,021
$
159,084
FY 2015 Annual reduction to Revenue Sharing
$
292,418
$
344,021
$
159,084
FY 2016 Annual reduction to Revenue Sharing
$
292,418
$
344,021
$
159,084
FY 2017 Annual reduction to Revenue Sharing
$
292,418
$
344,021
$
159,084
Total Fiscal Impact - FY 12 to FY 17
$
1,754,507
$
2,064,126
$
1,754,507
FISCAL IMPACT: The current budget for FY 12 has sufficient funds to make the $800,000 suggested
payment, drawing down part of the backlog balance. The remaining backlog amount will be budgeted
accordingly in the General Fund (001) within the respective fiscal years.
GROWTH MANAGEMENT IMPACT: There is no growth management impact associated with this
Executive Summary.
LEGAL CONSIDERATIONS: This item has been reviewed by the County Attorney, is legally sufficient,
and requires majority vote for approval. This item has been coordinated with lead counsel on the
Medicaid suit (in which Collier County joined with FAC and 54 other Counties). -JAK
STAFF RECOMMENDATION: Based upon our current knowledge of the legislation and on -going rule
making efforts, staff recommends the Board elect Option #3 which is depicted on the table above. This
option entails not disputing the certified amount, taking the 15% discount, making an early payment
toward the backlog amount in FY 12 and spreading the remaining balance over the next five (5) fiscal
years. The remaining backlog balance will be budgeted accordingly in the General Fund (001) within
the respective fiscal years.
PREPARED BY: Mark Isackson, Director, Corporate Financial Planning & Management Services, Office
of County Manager
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7/24/2012 Item 11.C.
COLLIER COUNTY
Board of County Commissioners
Item Number: 11.C.
Item Summary: Recommendation to review and provide direction to the County Manager
or his designee regarding the payment of Collier County "s Medicaid backlog (retrospective
bills). (Mark lsackson, Corporate Financial and Management Services Director)
Meeting Date: 7/24/2012
Prepared By
Approved By
Name: KlatzkowJeff
Title: County Attorney
Date: 7/18/2012 1:04:25 PM
Name: IsacksonMark
Title: Director -Corp Financial and Mgmt Svs,CMO
Date: 7/18/2012 1:30:38 PM
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