CHP: Judge To Consider Suit Challenging New Rates for Personal-Assistance Program

Judge To Consider Suit Challenging New Rates for Personal-Assistance Program

Crain’s Health Pulse  August 14, 2019

An Albany County Supreme Court judge on Friday will consider a lawsuit challenging a new payment methodology for fiscal intermediaries critical to the state's Consumer Directed Personal Assistance Program.

The Medicaid program provides services for more than 70,000 chronically ill and disabled individuals in the state, allowing them the flexibility to receive services in their own home and hire caregivers of their choice.

Fiscal intermediaries provide a range of support services to the program's consumers and interface with the state Medicaid program. However, cuts to the program in the state budget include moving administrative reimbursement methodology for the intermediaries to a per-member-per-month basis from an hourly basis, effective Sept. 1.

A lawsuit filed by the Consumer Directed Personal Assistance Association of New York State, the New York State Association of Health Care Providers, the New York Association on Independent Living and a number of fiscal intermediaries against the state Department of Health challenges that change. It alleges that the new rates are below the costs of fiscal intermediaries and will result in their widespread closure.

"Instead of trying to work with petitioners' representatives in an attempt to avoid this catastrophic result, the Department of Health has taken the hard-line approach of refusing to provide any substantive information concerning the rate methodology or to consider alternatives," the complaint stated.

Bryan O'Malley, executive director of the Consumer Directed Personal Assistance Association, said it has been consistent in its message that it believes tens of thousands of consumers will lose services under the new payment methodology.

"We want to work with the department to establish where we can come up with efficiencies, save money, adopt some alternative savings ideas and make changes to the program that allow it to be sustainable," O'Malley said. "We don't think these numbers will allow the program to continue to operate."

In the complaint, the association and other petitioners also raised concerns about the Department of Health's alternative plans for the program's consumers.

The department advised the Centers for Medicare and Medicaid Services "that in the event of fiscal intermediary closures, no individual will go without needed care because there is 'excess bed capacity for both hospitals and nursing homes,'" the complaint alleged.

Reliance on institutions, the complaint read, is in violation of a 1999 Supreme Court case that "requires states to ensure that individuals with disabilities receive services in the most integrated settings."

The petitioners are asking the court to declare that the new rate structure is invalid before Sept. 1 because they allege that the Department of Health has not complied with notice and comment rule-making, and its requirements are arbitrary and capricious. They also are requesting that the department be prohibited from enforcing the new rates.

The Department of Health has filed a motion to dismiss the case in response.

In a memo in support of its motion to dismiss, the department notes that the rate structure changes were included in the fiscal 2019–2020 budget to achieve a net savings of $75 million by consolidating administrative and payroll services of the Consumer Directed Personal Assistance Program. The memo argued that the lawsuit should be dismissed because, among other reasons, there is no evidence to support that it violated the state constitution because the department did not promulgate a rule; it interpreted a rule. Additionally, the memo stated that the petitioners' complaint lacks any allegation that they have suffered an injury meant to be protected by the Medicaid program or the Consumer Directed Personal Assistance Program.

"The ‎enacted budget maintains the state's full commitment to the Consumer Directed Personal Assistance Program while strengthening protections to ensure choice, geographic availability, cultural competency and quality services for the more than 70,000 self–directing consumers who employ their own aide," a spokeswoman for the Department of Health said. "We cannot comment on pending litigation; however, as we said previously, consumers will continue to receive services as they do today without any reduction in care—with no change in cost—and the program will continue to be available as it is today to new consumers." —Jennifer Henderson