Medi-Cal COVID-19 PHE Audits for Freestanding NF-B Facilities
Assembly Bill (AB) 81 (Chapter 13, Statutes of 2020) and Welfare and Institutions Code (WIC) section 14126.032 require DHCS to audit Freestanding Skilled Nursing Facilities Level-B (FS/NF-B) and Adult Freestanding Subacute Facilities (FSSA) costs and revenues that are associated with the COVID-19 Public Health Emergency (PHE) to determine whether a facility has adequately used increased Medi-Cal payments associated with the COVID-19 PHE to support the delivery of patient care, as defined in Section 14126.032(a). DHCS may recoup any amounts of the increased Medi-Cal payments associated with the COVID-19 PHE that DHCS finds were not used for allowable costs.
Allowable Costs
Pursuant to WIC section 14126.032(a)(1), allowable costs shall include patient care, additional labor costs attributable to the COVID-19 PHE including, but not limited to, increased wages or benefits, shift incentive payments, staff retention bonuses, pay differential for workers employed by more than one facility, and overtime payments to nonmanagerial workers, and other appropriate costs that support the delivery of patient care, including, but not limited to, personal protective equipment, COVID-19 testing for any workers, regardless of whether they are symptomatic or asymptomatic, infection control measures and equipment, and additional staff training.
Calendar Year 2023 COVID-19 PHE Rate Increase Spending Requirement
Pursuant to WIC sections 14126.032(a)(2) and 14126.033(c)(15), for the 2023 calendar year:
- FS/NF-B and FSSA facilities must use at least 85 percent of the amount of the increased Medi-Cal payments associated with the COVID-19 PHE on additional labor costs, including, but not limited to, increased wages or benefits, shift incentive payments, staff retention bonuses, pay differential for workers employed by more than one facility, and overtime payments to nonmanagerial workers.
- Such expenditures shall qualify for this purpose if they were either of the following:
- Implemented prior to January 1, 2023, and continued during the 2023 calendar year, or
- Implemented on or after January 1, 2023.
- For Calendar Year 2023, this new requirement will be added to the audit of COVID-19 costs and revenues as described above.
COVID-19 PHE Revenue and Cost Record Retention
To ensure compliance with WIC section 14126.032 requirements regarding use of revenues associated with the COVID-19 PHE, facilities are required to retain records regarding such revenues and related costs. A facility that received increased Med-Cal payments associated with the COVID-19 PHE shall disclose, at the time and in the form and manner specified by DHCS, any information requested by DHCS relating to costs and revenues associated with the COVID-19 PHE. This may include, but is not limited to, documentation of any grant, loan, payment or other revenue received by the facility pursuant to any federal or state law related to the COVID-19 PHE.
Audit Process and COVID-19 PHE Reporting Schedules
At this time, DHCS will audit Medi-Cal COVID-19 PHE related expenses and revenues for the PHE period from March 1, 2020 through December 31, 2022. Instructions for audits of additional PHE periods will be issued at a future time.
Facilities must e-File Medi-Cal COVID-19 PHE Reporting Schedules for each licensed facility.
The Medi-Cal COVID-19 PHE Reporting Schedules and Instructions can be found using the links below. Completed schedules must be submitted to PHEAudits@dhcs.ca.gov.
The deadline to submit Medi-Cal COVID-19 PHE Reporting Schedules for related expenses and revenues received during the PHE period from March 1, 2020 through December 31, 2022, is September 30, 2023.
Pursuant to WIC sections 14126.032, 14171, and 14172.5, failure to submit Medi-Cal COVID-19 PHE Reporting Schedules by September 30, 2023 may subject the facility to recoupment of up to the entire amount of the increased Medi-Cal payments associated with the COVID-19 PHE, and interest may be assessed where applicable.
Contact Us
For assistance/questions, please contact PHEAudits@dhcs.ca.gov.
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