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Budget Presentation (or, how we reversed the downward spiral…). Nevada County Behavioral Health CMHDA Small Counties Annual Meeting May 8, 2008 . Contents. Productivity Measurement & Benefits Review Services Monitor Insurance Cost Report Optimization Staffing and Funding

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Budget Presentation(or, how we reversed the downward spiral…)

Nevada County Behavioral Health

CMHDA Small Counties Annual Meeting May 8, 2008

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  • Productivity Measurement & Benefits

  • Review Services

  • Monitor Insurance

  • Cost Report Optimization

  • Staffing and Funding

  • Contract Structure

  • Other Topics

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Financial Turnaround

  • Nevada County had multiple years of large deficits; exhausting realignment fund balance

  • Staffing and budget cuts

  • Received 10% Realignment shift and some County General Fund

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Financial Turnaround

  • For 08-09, minimal County General Fund

  • Increase staff and contracts

  • No Realignment shift

  • Minimal realignment draw

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Productivity Expectation

  • More revenue with minimal increase in costs (low hanging fruit).

  • Individualized performance agreement, baseline 80% billable service expectation

  • Re-defined “billable” as productive

  • Train clinical and admin staff on billable services and correct use of codes

  • Set clear deadlines for daily documentation

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Productivity Monitoring

  • Cross reference of billing & time card coding

  • Daily documentation should include all hours worked, productive and non

  • Weekly reports on late billing documentation

  • Monthly report & feedback from managers and clinicians

  • Included in performance evaluations

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  • Bill for all assessment services; open the episode early

  • Focus on billable services

  • Limit pre-admission services

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Capture all Covered Services

  • Travel time associated with service provision

  • Documentation of service

  • Phone calls

  • Crisis

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Review Services

Don’t Pay for Services Covered by Other Agencies, Sources & Funds

  • Ambulance costs from Emergency Room to Hospital for 5150

  • Jail medical services

  • FQHC mental health services

  • PCP

  • Crime Victims

  • Veterans

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Review Services

Monitor High Cost Treatment & Provide Options

  • Acute inpatient

  • State Hospital

  • PHF

  • IMD

  • Board & Care

  • Day Treatment

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Review Services

Monitor High Cost Treatment & Provide Options

  • Develop budget and strategy for placement; consider ACT/wrap team impact

  • Open all Hospital, PHF, and other residential treatment services to billing system

  • Monthly report showing actual services and costs

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Increase Medi-Cal Enrollment

  • Assure that eligible beneficiaries are enrolled


  • Closely review cases for medical necessity if not Medi-Cal

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Increase Medi-Cal Enrollment

  • Decrease services and numbers of private insurance & Medicare

  • Medi-Cal is priority and mandate

  • Don’t subsidize for-profit insurance companies with your realignment dollars

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Indigent, Private Insurance & Medicare

  • Prioritize patients that will cost money for IMD, Jail, SNF, Board & Care, etc

  • Review open cases; close & refer if appropriate

  • Refer to pcp, church, insurance company, legislators, self help

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Insurance Monitoring

  • Monthly report with insurance status and type for all active clients

  • Put report in central location for updates

  • Assign roles and responsibility—case managers primary responsibility; admin staff support

  • Video eligibility and application technology

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Insurance Monitoring

  • Log actions--“close episode” or “met with client and referred to eligibility worker”

  • Collaborate with HHSA departments—social services/eligibility workers and Behavioral Health

  • Crisis Workers—get insurance information and fill out ISAWS 1 at hospital

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Cost Report – Maximize $$

  • Published charge vs. actual costs vs. SMA

  • Settle at lower of Costs or Charges (LCC); cap is SMA

  • Nominal Fee Provider worksheet in Cost report--filling in the boxes resulted in +$175,000 in settlement.

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Cost Report

  • Nevada County’s Published Charge was 15% below SMA

  • Our Actual Cost per unit was 5% above SMA

  • Change Published Charges to maximize cash flow and revenue

  • Nevada County increased Pub Chg to 5% above SMA

  • Medi-Cal will pay the SMA rates; private insurance and others billed at published chg

  • Increased Cash flow & reduced amount owed to county at Settlement

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Cost Report

  • Some Counties’ actual costs are less than SMA but they bill Medi-Cal at SMA

  • High cash flow--keep extra cash in a “savings account”, earn interest and pay back at settlement time

  • Or, increase Published Charge to be close to Actual to minimize settlement variance

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Cost Report – Admin Costs

  • Optimize Administrative Cost treatment

  • Maximum Medi-Cal reimbursement is 15%

  • Nevada County went from 7% admin cost reimbursement in 05-06 to 15% in 06-07.

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Cost Report – Admin Costs

  • Admin Costs should be treated consistently Year-to-Year

  • But there’s flexibility to optimize methodology; 15% to Medi-Cal is optimal

  • Can allocate administrative staff other than Director salary

  • Flexibility with A-87: building costs, computer costs, can be direct program expenses

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Cost Report – Manage Costs

Try to get actual costs at or just below the SMA:

  • Increase units, keeping costs constant

  • OR reduce costs, keeping units constant

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Cost Report – Other Thoughts

  • Charge 15% Admin to Contractors

  • QA claiming on Cost Report

  • Track QA work with clinical documentation or time-tracking for non-clinical staff

  • CMHDA Financial Services Committee; attend and ask questions

  • Hire consultants; Gary Ernst, Caryl Willard

  • Average Cost vs. Cost Center reporting

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Optimize Staffing and Funding

  • For small departments, generally adding clinical staff = more units = lower cost per unit

  • County has high fixed costs per unit of service

  • Economies of scale – optimize staff levels to lower fixed costs per unit of service, but don’t get too big

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Optimize Staffing and Funding

  • If fully funded by grant money, county staff are a better deal than contractors

  • County keeps all Medi-Cal, 15% admin, and associated grant funds

  • Cover all variable costs (salaries, office supplies, computer, etc…) plus portion of fixed costs

  • Contractor--all Medi-Cal goes to contractor, and county may be limited in getting admin $$

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Optimize Staffing and Funding

  • Incrementally add new staff, slowly

  • Keep staff fully productive and on their toes, but not overworked and burned out

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Optimize Staffing - Do Not Reduce Children’s Staff

  • EPSDT 95%

  • SB90+IDEA+3632 allocation

  • No realignment savings

  • If you cut staff, you may lose some economies of scale and result in net loss

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Contracts – Optimize Structure

  • For mix-funded contracts (Grant and Medi-Cal), don’t specify amount of each funding source

  • More Medi-Cal revenue generated = more MHSA, MIOCR, etc…for discretionary dept expenses

  • Non-Medi-Cal costs are fully funded; saves realignment

  • Bill Medi-Cal, even for grant funded services and programs

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Contracts – Optimize Structure

  • Include target billable service levels

  • 90% Medi-Cal eligibility target

  • Pay 1/12th of the contract if target billable services levels are met

  • Get monthly reports

  • Re-negotiate contracts mid year, based on performance

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Program Planning & Implementation

  • With every new grant or program, include all associated costs; direct and indirect, variable and fixed

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Program Planning & Implementation

  • Use existing staff so that minimal “new” costs are generated

  • Use Time-tracking for all staff involved in project.

  • Train staff to be aware of importance of coding to funding source/project

  • Non-clinical admin staff track time in project, using the electronic time-keeping system.

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Re-Read MHSA Supplantation Letter

  • DMH Letter 05-04

  • DMH Letter 05-08

  • Must be used for:

    MHSA programs

    Not replace state or county funds 04-05

    New or expanded programs

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Re-Read MHSA Supplantation Letter

  • If possible, cover & allocate MHSA funds to your admin, support, data entry, managers, etc

  • Use MHSA to pay for as much related travel, training, and supplies as allowed

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Other Funding Opportunities

Implement SB163

  • Wrap services to keep kids out of group homes

  • May not save dollars

  • But, services will generate Medi-Cal, and may free up MHSA and/or realignment

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Other Funding Opportunities

Become the Provider for Medi-Cal kids from Probation & Child Welfare

  • Court wards & dependents

  • All Medi-Cal EPSDT

  • If cash from Probation/Child Welfare is being used to pay outside providers, transfer a portion to BH instead

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  • Transitional housing and ACT type services may decrease costly IMD utilization

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Public Safety Argument for Small, Rural, Conservative Counties

  • Suicides; we have more suicide than homicide

  • DUI; much death and injury

  • Homicide; unique to Nevada County?

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Public Safety Argument for Small, Rural, Conservative Counties

  • Compete with Police & Fire – use their tactics to advocate for county general fund

  • Lifespan of SMI folks– decreases by 25 years