10A NCAC 22G .0308. RATE APPEALS

(a)  The Division of Medical Assistance shall consider only the following appeals for adjustment to the rates which would result in an annual rate increase to the provider from the Medicaid Program of one thousand dollars ($1,000) or more.

(1)           Appeals because of changes in the information used to calculate a facility's prospective rate.

(2)           Appeals for significant increases or decreases in a facility's overall base period operating costs due to, but not limited to, implementation of new programs, changes in staff or service, changes in the characteristics or number of clients, changes in a financing agreement, capital renovations, expansions or replacements which have been either mandated or approved by the Division of Medical Assistance and, except in life‑threatening situations, approved in advance by the applicable State agencies.

(3)           In order for said changes to be considered, they shall be consistent with all of the provisions of this plan.

(4)           Upon notification to the provider in writing, the Division of Medical Assistance may instigate a proceeding to reduce the provider's rates.  A rate reduction proceeding may be initiated upon the determination of just cause by the Division of Medical Assistance.  Grounds for just cause may include, but are not limited to, the following:

(A)          The provider has achieved material over collections of Medicaid funds derived from the prospective rate being greater than reasonable Medicaid costs.

(B)          Changes in Federal or State laws or regulations resulting in material operational cost savings.

(C)          Material changes in client profile resulting in the need for less costly services.

(D)          The burden of proof shall be on the Division of Medical Assistance to prove the need for said rate reduction.

(5)           In determining a fair and reasonable rate under appeal, the Division of Medical Assistance shall take into consideration all funds available to the provider from the Medicaid program and patient liability.  Providers are expected to utilize all available funds to provide the services that their clients need.

(6)           Reasonable occupancy factors, based on the HIM‑15, generally accepted accounting principles, and the preponderance of evidence derived from an in‑depth case‑by‑case review of all related facts and circumstances, shall be utilized in establishing fair and reasonable rates in the appeal process.

(7)           The Division of Medical Assistance shall not pay interest on the final dollar settlement resulting from the retroactive impact of any rate appeals.

(b)  Notification of appeal:

(1)           In order to appeal a rate the facility shall send to the Division of Medical Assistance an appeal application in writing within 60 days subsequent to the proposed effective date of the appeal rate.

(2)           The appeal application shall set forth the basis for the appeal and the issues of fact.  Appropriate documentation shall accompany the application and the Division of Medical Assistance may request in writing such additional documentation as it deems necessary.

(c)  The burden of proof on appeal shall be on the facility to present clear and convincing evidence to demonstrate the rate requested in the appeal is necessary to ensure efficient and economical operation, and meets the criteria of this Rule.

(d)  There shall be a written notification by the Division of Medical Assistance of the final decision on the facility's rate appeal.  However, at no point in the appeal process shall the facility have a right to an interim report of any determinations made by any of the parties to the appeal.

 

History Note:        Filed as a Temporary Adoption Eff. July 8, 1993 for a period of 180 days or until the permanent rule becomes effective, whichever is sooner;

Authority G.S. 108A‑25(b); 108A‑54; 108A‑55; 42 C.F.R. 447, Subpart C;

Eff. November 1, 1993;

Amended Eff. August 1, 1995.