SECTION 355.8704. Reporting and Monitoring

(a) A governmental entity that provides funds for use as the non-federal share in the Medicaid program must report information to the Texas Health and Human Services Commission (HHSC) in a form and format to be determined by HHSC.

(b) The information must be reported at least annually, no later than October 31st, or upon request by HHSC.

(c) HHSC will open the information reporting system prior to the end of the federal fiscal year and will review reported information based on governmental entity funding sources, including:

(1) local provider participation funds (LPPFs) authorized by the Texas Health and Safety Code Chapter 288 et seq. or other provider tax structures;

(2) non-LPPF provider taxes;

(3) ad valorem tax revenue;

(4) patient revenue;

(5) other local funding sources; and

(6) donations.

(d) HHSC will use the information from the report to monitor each governmental entity fund source and determine the likelihood that the funds are permissible for use in the Medicaid program. The monitoring will include the following:

(1) Survey. An electronic annual survey that will request:

(A) a list of all health care providers for which the governmental entity transferred or certified funds as the non-federal share;

(B) the relationship between the governmental entity and the health care provider, including a copy of any formal or informal agreements between the entity and the provider;

(C) the type of health care provider (i.e. ambulance, dentist, hospital, intermediate care facilities for individuals with an intellectual disability, nursing facility, physician practice group) and ownership status;

(D) the source of the funds used as the non-federal share transferred by the governmental entity;

(E) information on any debt instruments (bonds, loans, etc.) that a governmental entity utilizes and the relationship of the instrument to any transferred funds;

(F) to the extent patient revenue is used, a description of payor mix during the federal fiscal year and any anticipated changes;

(G) any transfer of funds or provision of services from a health care provider or entity related to a health care provider to the governmental entity, including in-cash or in-kind donations, or any other transfer of value;

(H) overview of funds received from all sources available to the governmental entity in its current fiscal year;

(I) other information as determined necessary and appropriate to determine compliance with federal or state statutes and regulations, including attestations of compliance from the local government; and

(J) any publicly available information, such as:

(i) audio recordings of discussions or written minutes from public meetings to set assessment rates or gather feedback from providers or their representatives;

(ii) written correspondence describing the entity's funding dedicated to the Medicaid program;

(iii) URL links to websites that describe the funds transferred or certified as the non-federal share or any agreement between the governmental entity and a health care provider or entity related to a health care provider; and

(iv) copies of any public notices, local orders, announcements, or other related documentation.

(2) Risk Assessment.

(A) The risk assessment will include:

(i) a risk assessment score based on self-reported annual survey responses; and

(ii) any adjustments made at HHSC's discretion based on supplemental documentation and discussion with the impacted governmental entity and review of additional documentation requests as may be needed, in HHSC's sole discretion, to confirm, audit, or modify self-reported data and qualitative descriptions.

(B) Funding sources will be categorized as likely permissible, further review required, or likely impermissible. HHSC will contact entities whose funding sources are categorized as further review required or likely impermissible to obtain additional information. The entity must furnish the requested information to HHSC within ten (10) business days of the date of the request.

(i) Likely permissible. Funding source appears to comply with federal and state statutes and regulations.

(ii) Further review required. Funding source compliance with federal and state statutes and regulations is unclear.

(iii) Likely impermissible. Funding source does not appear to comply with federal or state regulations.

(3) In-depth Review. HHSC will select a sample of survey respondents for an in-depth review in which HHSC may examine supporting documentation, either on-site or electronically, at HHSC's discretion. HHSC will select a sample of survey respondents sufficient to result in a 95 percent confidence level with a 5 percent margin of error. HHSC will initially select entities that are in the likely impermissible and further review required categories, and if additional entities are necessary to complete a sample size, they will be randomly selected from the likely permissible category. HHSC will notify a governmental entity if an on-site review will occur at least ten (10) calendar days prior to the visit.

(4) Determination. Determination of completeness of reporting and HHSC's assigned risk assessment for each funding source.

(5) Post-Determination Review. Post-determination review will be conducted as outlined in this subchapter.

(6) Federal Reporting.

(e) If a governmental entity fails to submit the required information or supplemental documentation as requested by HHSC by the deadline specified in this section, HHSC will not accept further transfer of funds for any Medicaid program from the governmental entity until the reporting requirement is satisfied and may process recoupments for any payments resulting from funds transferred determined to be non-compliant.

(f) Prior to the applicable deadline, a governmental entity may request an extension of up to ten (10) business days for any deadline contained in this subchapter. HHSC may grant or reject such request at its sole discretion.

(g) HHSC will notify the governmental entity upon determination of:

(1) reporting compliance;

(2) permissibility of funds; and

(3) a risk assessment category for each funding source.

(h) After review of any additional information provided, HHSC may also seek input on the likely permissibility of the funds from the Centers for Medicare and Medicaid Services (CMS). In the event HHSC elects to request input from CMS regarding the compliance of a specific funding source as contemplated by this subchapter, HHSC will notify the governmental entity prior to requesting such review. HHSC may, at its discretion, accept or reject local funds from the governmental entity for such funding source while awaiting CMS input; however, HHSC will recoup all Medicaid payments generated from a funding source deemed impermissible by CMS at any time.

Source Note: The provisions of this §355.8704 adopted to be effective May 19, 2022, 47 TexReg 2849