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Virginia Regulatory Town Hall
Agency
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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8/20/19  4:42 pm
Commenter: Arthur M. Ginsberg, Community Residences, Inc.

Comments on the Requirement for 90 Days of Operating Expenses
 

I am providing comments on behalf of Community Residences, Inc. d/b/a CRi in my capacity as the President/CEO.  CRi has been proudly providing services and supports in Virginia for forty-five years as a non-profit human service agency.

CRi is extremely concerned with the language in the Guidance Document proposed by the DBHDS Office of Licensing.  The Guidance Document states "Therefore, both applicants for licensure and licensed providers must be able to provide proof, at any time when requested by a representative from the department, that they have sufficient funds for 90 days of operating expenses, whether in cash or a line of credit". This statement does not reflect the language of the regulation for which the document purports to provide guidance: 12VAC35-105-210 states "The provider shall document financial arrangements or a line of credit that are adequate to ensure maintenance of ongoing operations for at least 90 days on an ongoing basis.  The amount needed shall be based on a working budget showing at least 90 days on an ongoing basis.  The amount needed shall be based on a working budget showing projected revenue and expenses". 

The language in the Guidance Document does not include projected revenue.  This is a significant omission which has implications for providers.  The reimbursement for the services CRi provides to over 800 Virginians a year does not allow for the generation of an operating margin to generate a cash reserve of 90 days of operating expenses.  If DBHDS and DMAS would revise the reimbursement models to allow for this necessary operating margin, providers would then be in a position to place 90 days of cash in reserve in alignment with the regulation.  In lieu of a change in the reimbursement models, projected or budgeted revenue must be considered by the Office of Licensing. 

The interpretation by the Office of Licensing would prove to be an unfunded mandate for providers.  This would place an impossible burden on providers.  On behalf of CRi,  I implore the DBHDS Office of Licensing to revise the language of the Guidance Document or make the necessary changes to the reimbursement models.   

CommentID: 75822