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Virginia Regulatory Town Hall
Department of Behavioral Health and Developmental Services
Guidance Document Change: This is a new guidance document regarding the current requirement for 90 days of operating expenses per the Rules and Regulations for Licensing Providers by the Department of Behavioral Health and Developmental Services (12VAC35-105).
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8/19/19  11:59 am
Commenter: Elisabeth Poe, Richmond Residential Services,Inc.

Requirment for Ninety Days of Operating Exepnses

Richmond Residential Services, Incorporated has been providing an array for residential and other community services to adults with intellectual disabilities in the metropolitan Richmond area since 1979. We are a private, nonprofit agency, and we have a number of concerns about the requirement for  providers to maintain ninety days of unused financial resources. We agree with the other providers who have commented that "projected revenue", as specified in the actual regulation, 12VAC35-105-210, should be considered as valid financial resources to cover operating expenses.  Maintaining an unused line of credit with a bank or credit union can be expensive and difficult.  Implementing this requirement at a time  when we are dealing with Waiver rates which have not kept up with the increased costs of doing business, e.g. worker's compensation, health  and liability insurance, utilities, food costs, even modest staff wage increases, etc. will have a negative impact to providers, especially smaller ones. As a nonprofit, we strive to maintain resources for emergencies and as a safety net.; however, we also balance that with putting resources toward our most valuable asset-our employees. We know that Direct Support Professionals in Virginia rarely make a living wage based on the Medicaid Waiver rates. Asking us to sequester funds that might be used to pay our staff a small increase places providers in an uncomfortable position.

  Additionally, we are concerned that Licensing staff lack sufficient training or expertise in interpreting financial documents.  The lack of detailed guidance on the calculations used to determine the adequacy of provider resources leaves too much leeway to the judgment of individual specialists. Using cash balances and open lines of credit to confirm ninety days of operating expenses is a faulty assessment and simply numbers in a vacuum if one does not have information on accounts payable and liabilities. Lastly, we are concerned about the confidentiality of the information and how it will be maintained.

  We understand the importance of all licensed providers maintaining their legal and financial obligations. However, this seems to be the wrong measure to determine that accurately in many cases. We appreciate the opportunity to comment.

CommentID: 75817