Notice is hereby given that the Department of Medical Assistance Services (DMAS) intends to modify its reimbursement methodology for inpatient services in a residential treatment facility pursuant to the Department’s authority under Title XIX of the Social Security Act. This notice is intended to satisfy the requirements of 42 C.F.R. Section 447.205 and of Section 1902(a)(13) of the Social Security Act, 42 U.S.C. Section 1396a(a)(13). All of the changes contained in this public notice are occurring in response to the Interim Final Rule with Comment Period published by the Centers for Medicare and Medicaid Services on December 4, 2007. 

The current reimbursement methodology for inpatient services in a residential treatment facility under the State Plan for Medical Assistance Services is codified in state regulations at 12 VAC 30-80-21. DMAS reimburses a daily rate that covers the cost for inpatient services. Under federal law, residential treatment facilities are institutions for mental disease (IMD), which are subject to special rules. Under CMS interpretation of federal law, the rate for all services furnished in and by an IMD (not just inpatient services) must be paid to the IMD to be covered under Medicaid. Therefore, DMAS will modify its reimbursement for residential treatment centers to cover the cost for all services furnished in and by an IMD consistent with CMS interpretation of federal law and any court decisions regarding that interpretation. 

This amendment is estimated to neither increase nor decrease total annual Medicaid spending.

A copy of this notice is available for public review from William Lessard, Director, Provider Reimbursement Division, DMAS, 600 East Broad Street, Suite 1300, Richmond, VA 23219, and this notice is available for public review at any local social service office.    Addresses for local social service offices may be obtained by contacting Mr. Lessard or the local city or county government. 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.