Virginia Regulatory Town Hall
Department of Medical Assistance Services
Board of Medical Assistance Services

General Notice
2016 Notice of Intent to Amend Medicaid Reimbursement Rates
Date Posted: 6/15/2016
Expiration Date: 7/15/2016
Submitted to Registrar for publication: YES
31 Day Comment Forum closed. Began on 6/15/2016 and ended 7/16/2016   [1 comments]









(Pursuant to §1902(a)(13) of the Act (U.S.C. 1396a(a)(13))




This Revised Notice was posted on June 15, 2016


The Virginia Department of Medical Assistance Services (DMAS) hereby affords the public notice of its intention to amend the Virginia State Plan for Medical Assistance to provide for changes to the Amount, Duration, and Scope of Medical and Remedial Care Services (12 VAC 30-50); Methods and Standards for Establishing Payment Rates—Inpatient Hospital Services (12 VAC 30-70); Methods and Standards for Establishing Payment Rates—Other Types of Care (12 VAC 30-80); and Methods and Standards for Establishing Payment Rates—Long Term Care (12 VAC 30-90).


This notice is intended to satisfy the requirements of 42 C.F.R. § 447.205 and of § 1902(a)(13) of the Social Security Act, 42 U.S.C. § 1396a(a)(13).  A copy of this notice is available for public review from William Lessard, Provider Reimbursement Division, DMAS, 600 Broad Street, Suite 1300, Richmond, VA  23219, or via e-mail at:


DMAS is specifically soliciting input from stakeholders, providers and beneficiaries, on the potential impact of the proposed reduction in the hospital inflation adjustment on beneficiary access to care.  Comments or inquiries may be submitted, in writing, within 30 days of this notice publication to Mr. Lessard and such comments are available for review at the same address.  Comments may also be submitted, in writing, on the Town Hall public comment forum attached to this notice.

This notice is available for public review on the Regulatory Town Hall (, on the General Notices page, found at:


DMAS is making these changes in its methods and standards for setting payment rates for services in order to comply with the legislative mandates set forth in the 2016 Acts of Assembly, Chapter 780, Item 306.


Reimbursement Changes Affecting Hospitals (12 VAC 30-70)


12VAC30-70-351 is being amended to:

  1. Reduce FY2017 inflation by 50% for inpatient and outpatient hospital operating (including freestanding psychiatric and long stay hospitals), graduate medical education (GME) and indirect medical education (IME) payments, disproportionate share hospital (DSH) payments and outpatient hospital rates with the exception of 100% of inflation for inpatient and outpatient hospital operating, GME, and IME payments for Children's Hospital of King's Daughters.     


The expected decrease in annual aggregate expenditures is $13,895,790.


12VAC30-70-221 and 12VAC30-70-381 are being amended to:

  1. Change the methodology for costing claims used to rebase weights from a fee-for-service global cost-to-charge methodology to a methodology that uses per-diems and cost-to-charge ratios by cost center for the fee-for-service and managed care claims, effective July 1, 2016.  In a similar fashion, each hospital's total costs by claim using this methodology will be divided by the total charges for the hospital cost-to-charge ratio.


The expected increase in annual aggregate expenditures is $0.



12VAC30-70-281 is being amended to:

  1. Create GME supplemental payments for new primary care and high-need specialty residencies, effective July 1, 2017.


The expected increase in annual aggregate expenditures is $2,500,000.


Reimbursement Changes Affecting Other Providers (12 VAC 30-80)


12VAC30-80-32 is being amended to:

  1. Increase rates for existing substance use disorder services and add rates for new substance use disorder services, effective April 1, 2017, and peer support services, effective January 1, 2017.


The expected annual increase in expenditures for the rate increase is $1,460,647, and the expected annual increase for expenditures for new services is $2,871,908. Administrative expenses of the program are expected to be $872,269 for a total annual aggregate increase of $5,204,824.


12VAC30-80-30 is being amended to:

  1. Implement a supplemental payment for Children's National Health System physicians, effective July 1, 2016. The total supplemental Medicaid payment shall be based on the Upper Payment Limit approved by CMS and all other Virginia Medicaid fee-for-service payments but not to exceed $551,000.


The expected increase in annual aggregate expenditures is $551,000.


Reimbursement Changes Affecting Nursing Facilities (12 VAC 30-90)


12VAC30-90-264 is being amended to:

  1. Convert the specialized care rate methodology to a fully prospective state fiscal year rate, effective July 1, 2016.  This would be accomplished consistent with the existing cost-based methodology by adding inflation to the per diem costs subject to existing ceilings for direct, indirect and ancillary costs from the most recent settled cost report prior to the state fiscal year for which the rates are being established.  The same inflation adjustment shall apply to plant costs for specialized care facilities that do not have prospective capital rates that are based on fair rental value.  The department shall use the state fiscal year inflation rate recently adopted for regular nursing facilities.  Partial year inflation shall be applied to per diem costs if the provider fiscal year end is different than the state fiscal year.  Ceilings shall also be maintained by state fiscal year.


The expected increase in annual aggregate expenditures is $0.


Contact Information
Name / Title: William Lessard  / Director, Division of Provider Reimbursement
Address: DMAS, 600 E. Broad Street, Suite 1300
Richmond, 23219
Email Address:
Telephone: (804)225-4593    FAX: (804)786-1680    TDD: ()-