Submitted Online (www.townhall.com) and Sent Via Email (Jimeequa.Williams@dmas.virginia.gov)

November 9, 2023

Jimeequa Williams

Virginia Department of Medical Assistance Services

600 E. Broad St., Suite 1300

Richmond, VA 23219

Re:       Virginia Hospital & Healthcare Association

Public Comment on Intent to Amend the State Plan – Emergency Room Charges

Virginia Hospital & Healthcare Association (“VHHA”) appreciates the opportunity to submit comments to the Virginia Department of Medical Assistance Services (“DMAS”) in response to its Notice of Intent to Amend the Virginia State Plan for Medical Assistance (the “State Plan”) posted on October 11, 2023 (the “DMAS Notice”).  In the DMAS Notice, DMAS specifically solicited input on the potential impact of the proposed changes to eliminate a provision allowing the pending, reviewing, and the reducing of fees for avoidable emergency room (“ER”) claims (the “Downcoding Provision”).  Elimination of this provision is required by a federal court order, dated April 27, 2023, (Va. Hosp. & Healthcare Assoc., et al. v. Roberts, et al., 3:20-cv-00587-HEH) (the “Order”).  VHHA supports DMAS’ proposed change to repeal/remove the Downcoding Provision from the State Plan as described in the DMAS Notice and consistent with the court’s ruling in the Order.

In its June 19, 2020, public comment letter to DMAS regarding a Notice of Intent to amend the State Plan to implement the Downcoding Provision, VHHA stated its opposition citing in detail its serious concerns that the Downcoding Provision will violate federal Medicaid regulations, conflict with the well-established “prudent layperson” (“PLP”) standard, raise constitutional concerns, and ultimately fail to reduce avoidable and unnecessary ER utilization.  In particular, the Downcoding Provision would cause DMAS to violate regulations at 42 CFR § 438.114 prohibiting state Medicaid agencies and Managed Care Organizations (“MCOs”) from (i) denying payment for treatment for an emergency medical condition and (ii) limiting what constitutes an emergency medical condition on the basis of lists of diagnoses or symptoms.  Indeed, the court found in Va. Hosp. & Healthcare Assoc., et al. v. Roberts, et al. that the Downcoding Provision violates and is not in accordance with the standards set forth in these regulations along with other provisions of the Medicaid Act.

Repeal/removal of the Downcoding Provision will have several positive impacts including not inappropriately penalizing hospitals and ER physicians for meeting required federal statutory obligations under the Emergency Medical Treatment and Active Labor Act (“EMTALA”).  As we addressed in previous public comment, EMTALA obligates hospitals to provide an appropriate medical screening examination to all individuals who present to the ER in order to determine whether an emergency medical condition exists, regardless of their ability to pay or their insurance status.  Implementation of the Downcoding Provision was in direct conflict with this duty to patients, causing hospitals and ER physicians to incur financial penalties for complying with this federal law.  Repeal/removal of these penalties will help to alleviate some of the financial strain on the ability of hospitals to staff ERs and meet ever-increasing demand for ER services, especially among Medicaid enrollees and medically underserved, vulnerable, and low-income individuals and families.

We are also concerned that the DMAS Notice understates the impacts of repeal/removal of the Downcoding Provision.  The DMAS Notice estimates an expected increase in annual aggregate fee-for-service expenditures of approximately $141,666 in federal funds from repeal/removal of the Downcoding Provision in FFY24 and FFY25.  This is dramatically lower than estimated savings for fee-for-service expenditures from implementation of the Downcoding Provisions when it was implemented – then estimated to be $2,642,866 in federal funds for FFY20 and $10,624,321 in federal funds for FFY21.  We are repeating here our request for DMAS to provide additional information on the calculation of these amounts and verification of same.  

Lastly, as we have stated previously, the Medicaid program in general, and Medicaid beneficiaries in particular, are not well served when actual emergencies are, by default, treated as non-emergencies merely because a patient has a diagnosis that could have been treated in an alternative setting of care other than the ER.  Reducing provider reimbursement for such services will not address the conditions or behaviors underlying the need for emergency medical services, but rather will penalize providers for serving their community and complying with the law.  

For all of the reasons stated herein, VHHA supports DMAS’ proposed change to repeal/remove the Downcoding Provision from the State Plan as described in the DMAS Notice and consistent with the court’s ruling in the Order.  If you have any questions or require clarifications of our comments, please feel free to contact Brent Rawlings brawlings@vhha.com, Senior Vice President & General Counsel.

Sincerely,

R. Brent Rawlings

Senior Vice President & General Counsel