Welcome Medicaid Non-Emergency Transportation Re-distribution Formula Workshop

1. WelcomeMedicaid Non-Emergency Transportation Re-distribution Formula Workshop

2. Why are we redistributing the Medicaid NET allocations? • Chapter 427.013(28),FS requires the Commission to develop an allocation methodology separately accounting for Medicaid beneficiaries. • Audit by the State Attorney General’s office found insufficient controls assuring that payment to providers was reasonable. • 7 years w/o a change, during which we have knowledge of certain specific areas with an imbalanced allocation.

3. Our approach to re-distribution • Use the factors required in 427.013(28) FS. • Account for Medicaid beneficiaries; • Actual costs of each trip based on prior year data; • Gate-keeping efficiencies to reduce cost; • Cost comparisons between providers; and • Comparison to the cost of transporting the general public. • Consider Historic Demand. • Annually re-evaluate funding methodology

4. Ingredients of each formula presented today: • Provides 100% distribution of 2010-11 costs for BP, CA, VT, OB services, plus 50% of the Trip Travel Report costs to the areas that reported them. • Provides the largest portion consistent with the past allocation ratio, to account for historic demand. • Provides a smaller distribution of the remaining amount based on a performance variable formula pursuant to 427 FS.

5. Pieces of the Redistribution Pie

6. BP, CA, VT, OB and Trip Travel BP, CA, VT, OB Trip travel report For this year, all formulas also include 50% of the Trip Travel Report costs to the areas that reported them. All formulas provide 100% distribution of 2010-11 costs for BP, CA, VT, OB services to the areas that reported them.

7. Historic Demand After distribution of BP, CA, VT,OB and Trip Travel report costs, the largest portion is distributed based on Historic Demand.

8. Performance Variable 13 includes 4 factors of transportation cost The final portion to be distributed is based on actual prior year encounter data with adjustments to performance indicators. 1. Number of riders as a ratio to eligibles. 2. Average trips per rider. 3. Average cost per mile. 4. Average miles per trip.

9. Performance Variable 13, Factor 1 • 1. Number of riders (as a ratio to eligibles) is used as an indicator of gatekeeping. • Areas with ratios 25% above the group median are adjusted down. • Areas with ratios below the 20th percentile reflect favorable performance in gatekeeping. They receive incentive adjustment, in formulas 3 and 4.

10. Performance Variable 13, Factor 1 25% above median = 3.90% Urban median = 3.12% 20th percentile = 1.71% 25% above median = 7.08% Rural median = 5.67% 20th percentile = 3.22%

11. Performance Variable 13, Factor 2 2. Average trips per rider is also used as an indicator of gatekeeping. • Areas where the trips/rider is 25% above the group median are adjusted down. • Areas where the trips/rider is below the 20th percentile reflect favorable performance in gatekeeping. Those receive incentive adjustment, in formulas 3 and 4.

12. Performance Variable 13, Factor 2 25% above median = 48.3 Urban median = 38.7 20th percentile = 23.0 25% above median = 27.9 Rural median = 22.3 20th percentile = 18.5

13. Performance Variable 13, Factor 3 3. Average local cost per mile is used as an indicator of cost efficiency. • Areas where the cost/mile is 25% above the group median are adjusted down. Formula 4 adjusts to the group median. • Areas where the cost/mile is below the 20th percentile reflect favorable performance in cost efficiency. Those receive incentive adjustment, in all 4 formulas.

14. Performance Variable 13, Factor 3 25% above median = $4.19 Urban median = $3.35 20th percentile = $2.68 25% above median = $2.16 Rural median = $1.73 20th percentile = $1.25

15. Performance Variable 13, Factor 4 4. Average trip length. • The average trip length is a unique indicator of the service characteristic. No adjustments are made to this factor.

16. Performance Variable 13, Factor 4 Urban median = 8.8 Rural median = 30.6

17. All performance variable 13 calculations 1. The lower of actual performance factors vs. the adjusted values or incentives will be used in determining each county’s cost. 2. Each county’s cost, as a ratio of the total statewide cost, is applied to the weighted value of the “performance variable”.

18. August Options 1,2,3,4 vs. Today's Formulas 1,2,3,4 • The encounter data is newer. July 2010 to June 2011, instead of Jan to Dec 2010. • Incentives have been given for good performance below the 20th percentile on Formula 3 and 4. • .10% added for low rider ratio. (gatekeeping) • 1.5 added for low trips per rider. (gatekeeping) • $.10 per mile added for low cost per mile (cost efficient) • Formula 4 lowers maximums @ the median 2 group values

19. Differences between the 4 formulas distributed today • Formula 1 = performance variable 13 • No incentives • 25% above 2 group medians • Formula 2 = performance variable 13-B • No incentives • 25% above 3 group medians • Formula 3 = performance variable 13-D • Incentives below 20th percentile • 25% above 2 group medians • Formula 4 = performance variable 13-D1 • Incentives below 20th percentile • @ the median within 2 groups

20. Difference in Group Sizes • 13-B calculates median values within 3 group sizes. Each group is based on avg. trip length. Short < 12, Medium = 12.1-25.9, Long > 26 • 13, 13-D, & 13-D1 calculates median values within 2 group sizes. Each group is based on avg. trip length. Urban < 15, Rural > 15

21. What's Next? • CTD approval of formula choice at Oct 28, 2011 meeting. • Amend existing contracts effective Jan. 1, 2012.

22. Pieces of the Redistribution Pie