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Agenda 06/08/2021 Item #16D13 (Advertise an Ordinance for Local Provider Participation Fund for Directed Payment Plan)06/08/2021 EXECUTIVE SUMMARY Recommendation to authorize staff to advertise an Ordinance to establish a Local Provider Participation Fund for the Directed Payment Program to be solely funded by assessments on Collier County hospitals owned property or property used as a hospital, authorize the County Manager or designee to sign the AHCA Letter of Agreement, and authorize necessary Budget Amendments. OBJECTIVE: To establish an Ordinance in support of area hospitals that provide health services to the low-income citizens of Collier County. CONSIDERATIONS: The County has participated in the State’s Intergovernmental Transfer Program (IGT) with the Agency for Health Care Administration (AHCA) program since 2006. As a participant in the IGT program, the County provides funding to support the federal matching program for uncompensated care known as the Low-Income Pool Program (LIP). Since 2014, hospitals have elected to no longer participate in the LIP program. However, the County continues to participate in the minor LIP program with Collier Health Services, Inc., the County’s Federally Qualified Healthcare Center (FQHC). A similar IGT program has recently been established by the Florida Legislature, known as the Directed Payment Program (DPP). Nationwide, and especially in Florida, hospitals continue to struggle with the shortfall in Medicaid reimbursement rates. Hospitals in Collier County provide millions of dollars of care to persons who qualify for Medicaid annually, because on average, Medicaid only covers 60% of the costs of the health care services provided by Hospitals to eligible persons. As a direct result of continued revenue shortfalls, during the FY 21 Florida Legislative session, Governor DeSantis, with the full support of the House and Senate, approved the establishment of the Directed Payment Program (DPP). This program is available to hospitals providing inpatient and outpatient services to Medicaid-managed care enrollees. It is the intent of the DPP to offset hospitals’ Medicaid shortfalls and improve the quality of care provided to the Florida Medicaid population. This program has been adopted by three Florida counties to date - Escambia, Brevard, and Walton. In April, County staff was approached by Collier County hospitals and requested participation in the Directed Payment Program. The hospitals are supportive of the program and are aware of the assessment process and have all agreed to participate. In order to participate, the County must establish a Local Provider Participation Fund (LPPF) via ordinance. The proposed Ordinance establishes the parameters of the LPPF program. At the request of the hospitals annually, the County will impose a non-ad valorem assessment upon real property owned or used by the hospitals to help fund the non-federal share of the State’s Medicaid Program. This assessment will provide additional funding for Medicaid payments to close revenue shortfalls associated with the program. Leveraging additional federal support through the DPP program will directly benefit the services delivered to Medicaid-eligible persons and support their ability to provide critical health care programs. It is necessary to establish the LPPF program prior to July to ensure that the hospitals will have the opportunity to secure all funds available in t he upcoming state fiscal year. The proposed ordinance will enable the County to levy a uniform non-ad valorem special assessment in compliance with 42 C.F.R. 433.68(d). The assessment shall be fairly and reasonably apportioned among each of the hospital’s properties within the County limits. Annually, the Board shall set the assessment in amounts that in the aggregate will generate sufficient revenue to fund the non -federal share of Medicaid payments associated with Local Services to be funded by the assessment. The assessment shall constitute a lien upon the assessed properties. Revenue generated by the proposed assessment shall be held in a 16.D.13 Packet Pg. 1831 06/08/2021 separate account called the Local Provider Participation Fund (LPPF) and will be used only to: (1) provide the Florida Agency for Health Care Administration the non-federal share for Medicaid payments to be made directly or indirectly in support of hospitals serving Medicaid beneficiaries and (2) reimburse the County for administrative costs associated with the implementation of the assessment authorized by this Ordinance, as further specified in the forthcoming assessment resolution. If at the end of the Fiscal Year, additional amounts remain in the Local Provider Participation Fund, the Board is authorized to make a refund to assessed properties in proportion to amounts paid in during the Fiscal Year. If this item is approved, the proposed ordinance will be advertised and brought back to the Board with a resolution adopting a non-ad valorem special assessment. The Tax Collector and Property Appraiser have no responsibilities under the alternative assessment process that is proposed. The alternative method of collection pursuant to F.S. 197.3631 states this method shall not require the tax collector or property appraiser to perform those services as provided for in ss. 197.3632 and 197.3635. Pursuant to Section 197.3632 additional authority is granted to local governments to impose and collect non-ad-valorem assessments supplemental to the home rule powers. In future years County staff may elect to recommend that the Board update the ordinance and adopt a future resolution to implement a uniform assessment process that involves the services of the Tax Collector and Property Appraiser. The Tax Collector and Property Appraiser have been coordinated with and they have no objection to the adoption of the program. FISCAL IMPACT: The Directed Payment Program is a funding mechanism that takes hospital funds collected through a non-ad valorem assessment and directs those dollars to the Agency for Health Care Administration (AHCA) to fund the non-federal share of the State’s Medicaid Program ultimately resulting in enhanced funding returned to the hospitals. AHCA is currently working on the implementation plan for the Directed Payment Program. Once AHCA finalizes its modeling the amount of non-federal share (the assessment) needed to fund the Directed Payment Program will become available. The information currently available suggests the assessment will be between $10 and $20 million with the amount transmitted to AHCA being no more than the actual amount of assessment dollars received by the County less administrative costs. No more than $150,000 will be retained for administrative expenses. Relative to budget administration, a budget amendment is necessary that establishes a Local Provider Participation Fund. The budget will include a revenue account for receipt of assessments paid by the hospitals and expense accounts for the remittance of program funds to AHCA and reimbursement of County administrative costs associated with implementation of the assessment. Advertising fees are expected to be $650. GROWTH MANAGEMENT IMPACT: There is no Growth Management impact. LEGAL CONSIDERATIONS: The documents have an effective date of July 1, 2021, but are contingent on approval of the enabling legislation by the Governor of the State of Florida. This item is approved as to form and legality and requires a majority vote for Board action. - JAB RECOMMENDATION: To authorize staff to advertise an Ordinance to establish a Local Provider Participation Fund for the Directed Payment Program to be solely funded by assessments on hospital - owned property or property used as a hospital, authorize county manager or designee to sign the AHCA Letter of Agreement, and authorize necessary Budget Amendments. Prepared By: Kristi Sonntag, Director, Community and Human Services Division 16.D.13 Packet Pg. 1832 06/08/2021 ATTACHMENT(S) 1. Ordinance (PDF) 16.D.13 Packet Pg. 1833 06/08/2021 COLLIER COUNTY Board of County Commissioners Item Number: 16.D.13 Doc ID: 16076 Item Summary: Recommendation to authorize staff to advertise an Ordinance to establish a Local Provider Participation Fund for the Directed Payment Program to be solely funded by assessments on Collier County hospitals owned property or property used as a hospital, authorize county manager or designee to sign the AHCA Letter of Agreement, and authorize necessary budget amendments. Meeting Date: 06/08/2021 Prepared by: Title: Manager - Federal/State Grants Operation – Community & Human Services Name: Kristi Sonntag 05/27/2021 8:26 AM Submitted by: Title: Manager - Federal/State Grants Operation – Community & Human Services Name: Kristi Sonntag 05/27/2021 8:26 AM Approved By: Review: Community & Human Services Kristi Sonntag CHS Review Completed 05/27/2021 8:27 AM Operations & Veteran Services Kimberley Grant Additional Reviewer Completed 05/27/2021 8:39 AM Community & Human Services Maggie Lopez Additional Reviewer Completed 05/27/2021 9:14 AM Public Services Department Dan Rodriguez Public Services Department Completed 05/27/2021 10:57 AM Grants Erica Robinson Level 2 Grants Review Completed 05/27/2021 11:08 AM Public Services Department Dan Rodriguez PSD Department Head Completed 05/27/2021 11:44 AM County Attorney's Office Jennifer Belpedio Level 2 Attorney of Record Review Completed 05/27/2021 2:02 PM Office of Management and Budget Debra Windsor Level 3 OMB Gatekeeper Review Completed 05/27/2021 2:14 PM Grants Therese Stanley Additional Reviewer Completed 05/27/2021 5:24 PM Budget and Management Office Ed Finn Additional Reviewer Completed 06/01/2021 12:26 PM County Attorney's Office Jeffrey A. Klatzkow Level 3 County Attorney's Office Review Completed 06/01/2021 1:41 PM County Manager's Office Sean Callahan Level 4 County Manager Review Completed 06/01/2021 2:46 PM Board of County Commissioners Geoffrey Willig Meeting Pending 06/08/2021 9:00 AM 16.D.13 Packet Pg. 1834 16.D.13.a Packet Pg. 1835 Attachment: Ordinance (16076 : LPPF Hospital AHCA Assessment) 16.D.13.a Packet Pg. 1836 Attachment: Ordinance (16076 : LPPF Hospital AHCA Assessment) 16.D.13.a Packet Pg. 1837 Attachment: Ordinance (16076 : LPPF Hospital AHCA Assessment) 16.D.13.a Packet Pg. 1838 Attachment: Ordinance (16076 : LPPF Hospital AHCA Assessment) 16.D.13.a Packet Pg. 1839 Attachment: Ordinance (16076 : LPPF Hospital AHCA Assessment) 16.D.13.a Packet Pg. 1840 Attachment: Ordinance (16076 : LPPF Hospital AHCA Assessment) 16.D.13.a Packet Pg. 1841 Attachment: Ordinance (16076 : LPPF Hospital AHCA Assessment) 16.D.13.a Packet Pg. 1842 Attachment: Ordinance (16076 : LPPF Hospital AHCA Assessment) 16.D.13.a Packet Pg. 1843 Attachment: Ordinance (16076 : LPPF Hospital AHCA Assessment) 16.D.13.a Packet Pg. 1844 Attachment: Ordinance (16076 : LPPF Hospital AHCA Assessment)