(213) 240-8101
October 26, 2000
Honorable Board of Supervisors
County of Los Angeles
383 Kenneth Hahn Hall of Administration
500 West Temple Street
Los Angeles, California 90012
Dear Supervisors:
SIMPLIFICATION AND STREAMLINING OF FINANCIAL SCREENING PROCEDURES
(All Districts) (3 Votes)
IT IS RECOMMENDED THAT YOUR BOARD:
1. Approve the Outpatient Reduced-Cost Simplified Application (ORSA) Plan, substantially similar to Exhibit 1, for implementation beginning January 1, 2001 and continuing through June 2005, at all Department of Health Services (DHS or Department) ambulatory care settings only, (i.e., Comprehensive Health Centers [CHCs], Health Centers [HCs], and DHS hospitals) as an alternative to the Ability-To-Pay (ATP) Plan, contingent upon approval by the Court in the Etter lawsuit.
2. Authorize County Counsel to take all necessary steps to secure Court approval of the Plan.
3. Approve various modifications to simplify the ATP Services Agreement and corresponding written notice regarding no-cost/low-cost plans.
4. Instruct the Director of Health Services, or his designee, to evaluate the ORSA Plan and consider its potential discontinuation at the end of the 1115 Waiver Extension period, June 2005, if the estimated annual reductions in Pre-Payment and Self-Pay revenues have a negative fiscal impact on the Department.
5. Instruct the Director of Health Services to work with the Public/Private Partnership (PPP) Program Partners to develop and implement, if appropriate and mutually agreeable, a portable eligibility system which would cover patients at any DHS or PPP site, provide uniform systemwide eligibility for patients, and maximize the enrollment of patients in programs such as Medi-Cal, Healthy Families, etc.
Honorable Board of Supervisors
October 26, 2000
Page 2
The purpose of the recommended actions is to reduce barriers to health care by simplifying the financial screening process, improving patient satisfaction with the financial screening process, and increasing Medi-Cal and Healthy Families applications.
In approving the recommended actions, the Board is:
- satisfying one of the 1115 Waiver Extension Performance Standards, which is subject to sanctions;
- authorizing the implementation of the ORSA Plan, upon Court approval, at all DHS ambulatory care settings;
- authorizing County Counsel to take all necessary steps to secure Court approval of the ORSA Plan;
- authorizing modifications to the ATP Services Agreement and corresponding written notice regarding no-cost/low-cost plans;
- instructing the Director of Health Services to evaluate the ORSA Plan at the end of the 1115 Waiver Extension period (June 2005) to determine if it should be discontinued;
- instructing the Director of Health Services to work with the PPPs to develop and implement, if appropriate, a portable eligibility system.
Approval of the recommended actions will allow the Department to implement a program to comply with the Board=s May 11, 1999 instruction to develop a plan which eliminates unreasonable obstacles to patients= access to health care by improving and simplifying the Department=s financial screening process. Additionally, these actions will allow the Department to fulfill one of the 1115 Waiver Extension Performance Standards, which is subject to sanctions.
Exhibit 1 provides additional information regarding the ORSA Plan.
The Fiscal Year (FY) 2000-01 cost of implementing the ORSA Plan effective January 1, 2001 is $0.9 million for 46 full-time equivalents (FTEs). In addition, implementation of ORSA is estimated to result in a reduction of $2.2 million in Pre-Payment and Self-Pay revenue in FY 2000-01.
The estimated annual staffing cost and revenue reduction for the remaining fiscal years of the 1115 Waiver Extension (FY 2001-02 through FY 2004-05) are estimated to be approximately $1.9 million and $6.6 million, respectively.
Honorable Board of Supervisors
October 26, 2000
Page 3
The Department will monitor collections, visits, Medi-Cal and Healthy Families applications, etc., to determine the fiscal impact on the Department and, prior to the end of the Waiver Extension, the Director will evaluate whether the ORSA Plan should be continued past the end of the Waiver Extension period.
Exhibit 2 provides additional details on planned monitoring activities.
Funding is included in the DHS 2000-01 Adopted Budget and will be requested in subsequent years= budget requests.
On May 11, 1999, your Board instructed the Director of Health Services, in conjunction with the Chief Administrative Office (CAO) and County Counsel, to conduct a review of DHS= financial screening procedures and report back with a plan to improve the current financial screening system by: 1) simplifying the ATP process so that financial screening and health care delivery occur at the same location; 2) improving access to eligibility programs, (e.g., Medi-Cal, Healthy Families, ATP, etc.); and 3) eliminating other unreasonable obstacles to health care access associated with the financial screening process. Additionally, the 1115 Waiver Extension requires Los Angeles County to implement a simplified financial screening program for indigents at DHS ambulatory care sites.
The ORSA Plan is designed to address the above concerns. ORSA is a simplified single page patient declaration application that covers outpatient services only (including pharmacy) at all DHS ambulatory care settings, (i.e., CHCs, HCs, and DHS hospitals). ORSA eligibility with no liability is based on 133.33% of the Federal Poverty Level (FPL). Patients with income over 133.33% FPL may have a liability. The coverage period under ORSA is six months (unless income status changes), and a mail-in renewal process is available. An application for Medi-Cal is required, if potentially eligible. Patients with third-party coverage are not eligible for ORSA.
County Counsel advises that implementation of ORSA and the modification of ATP (i.e., simplification of the ATP Services Agreement and corresponding written notice), are contingent upon securing approval of the plaintiff class in the Etter lawsuit and the Court. In 1987, the County and a class of indigent recipients of County medical care stipulated to a consent decree that established the present ATP policy. The consent decree requires the County to notify the plaintiff class of any changes to the ATP policy and gives the Court continuing jurisdiction over the case. Upon Board approval of ORSA, County Counsel will coordinate with legal representatives of the Etter class to obtain Court approval. In prior class action matters, the Courts have required that a fairness hearing be held on any changes to the consent decree, with posting of notices of the hearing required for approximately 30 days.
Since the County=s patient financial screening programs and processes, including the current ATP, are part of the Health Care Financing Administration=s (HCFA) approval of the County=s initial 1115 Waiver and a requirement to simplify the screening program is a condition of the 1115 Waiver Extension, the Department will seek HCFA concurrence regarding the ORSA Plan proposal.
Honorable Board of Supervisors
October 26, 2000
Page 4
These recommended actions represent the collective agreement of representatives of the CAO, County Counsel, and DHS and are intended to simplify and streamline DHS= financial screening system and reduce impediments to care. SEIU and the legal representatives of the Etter class generally concur with and support these proposed actions.
Attachment A provides additional information.
Not applicable.
Implementation of these actions will address HCFA=s concern that the Department provide simplified eligibility criteria in DHS ambulatory care settings.
When approved, this Department requires three signed copies of the Board=s action.
Respectfully submitted,
Mark Finucane
Director of Health Services
MF:pm
Attachments
c: Chief Administrative Officer
County Counsel
Executive Officer, Board of Supervisors
BLET/CD186.JHR
ATTACHMENT A
SUMMARY OF PLAN
1. TYPE OF SERVICES:
The Outpatient Reduced-Cost Simplified Application (ORSA) Plan is designed to simplify the financial screening process so that financial screening and health care delivery occur at a single location, the processing time for eligibility applications is reduced, and unreasonable obstacles to health care access caused by the financial screening process are eliminated.
2. AGENCY ADDRESS AND CONTACT PERSON:
Department of Health Services
313 N. Figueroa Street, Room 907
Los Angeles, California 90012
Attention: Gary W. Wells, Director of Finance
Telephone: (213) 240-7882
3. TERM:
Not applicable.
4. FINANCIAL INFORMATION:
Funding is included in the DHS 2000-01 Adopted Budget and will be requested in subsequent years= budget requests.
5. GEOGRAPHIC AREA SERVED:
Department-wide.
6. ACCOUNTABLE FOR MONITORING:
Larry Gatton, Chief, Financial Applications and Revenue Services
7. APPROVALS:
Office of the Director of Finance: Gary W. Wells, Director
County Counsel (as to form): Roberta M. Fesler, Senior Assistant County Counsel/
Patrick Wu, Principal Deputy County Counsel
County Administrative Office: David E. Janssen, Chief Administrative Officer
(R:\1PADAMS\FSSBLTSUM3.wpd) October 18, 2000
EXHIBIT 1
SUMMARY OF THE OUTPATIENT REDUCED-COST SIMPLIFIED
APPLICATION (ORSA) PLAN
Representatives from the Chief Administrative Office, County Counsel, and Department of Health Services (DHS) had numerous meetings and discussions, and reviewed various documents and processes to assess the existing financial screening system. Additionally, central staff have solicited input from the Financial Screening Model Workgroup, DHS-SEIU Strategic Alliance Systemwide Patient Financial Services (PFS) Project Team, Medicaid Demonstration Project Office, Ambulatory Care and Women=s Health Offices, Public/Private Partnership (PPP) Program Partners, Department of Public Social Services (DPSS), and legal advocate representatives, and have surveyed facilities and other counties.
As a result of these efforts, the following significant issues were identified:
$ ATP Complexity
The complexity of current ATP procedures requires staff to expend extensive time interviewing patients and obtaining verification documents to determine the patient=s liability, even though most are subsequently determined to have no liability. (Over 80% of DHS inpatient ATP applicants have zero liability and a similar percentage of outpatient ATP applicants are estimated to have zero liability.)
$ Staffing
The current number and classifications of financial screening staff are insufficient to provide financial screening, including ATP and eligibility application (i.e., Medi-Cal, Healthy Families, etc.) processing at all ambulatory care settings, (i.e., Comprehensive Health Centers [CHCs], Health Centers [HCs], and DHS hospitals) or during all hours of their operation. This can result in long waiting periods for patients to apply for ATP and other programs; some patients need to return on another day or be referred to another DHS facility or DPSS for Medi-Cal application assistance. The current number and classifications of financial screening staff are insufficient to eliminate these deficiencies despite the implementation of a simplified and streamlined financial screening system.
$ Registration and Financial Screening
The patient registration and financial screening processes are frequently performed on the same day of service and can sometimes result in delays. Additionally, patients applying for ATP or another eligibility program (e.g., Medi-Cal, Healthy Families, etc.) are often not prepared to provide the necessary information and verification, requiring them to return to the facility at another time.
C Eligibility Program Knowledge
A recent training survey assessment of the CHC/HC staff indicates that some financial screening staff need additional training on the various eligibility programs (i.e., Medi-Cal, Healthy Families, etc.) to enable them to determine eligibility and better inform patients of all available programs.
$
$ Organizational Structure
Staff performing financial screening and completing eligibility-related applications in the CHCs/HCs do not currently have the management support of a PFS organization on-site which could provide direct technical support and program expertise as well as better coordination of staffing resources.
$ Patient Dissatisfaction
Some patients have expressed dissatisfaction with the complexity of, and extensive time required to complete, the application process for ATP, Medi-Cal, Healthy Families, etc.
Since the financial screening issues described above are less concentrated in inpatient settings and the related potential costs of addressing the issues would be significantly greater, the actions being recommended, with the exception of the training program, are limited to outpatient settings. The following actions are designed to enhance the financial screening system and address most of the aforementioned issues:
1. Outpatient Reduced-Cost Simplified Application (ORSA) Plan:
ORSA would be offered in all ambulatory care settings, (i.e., CHCs, HCs, and DHS hospitals) as an alternative to ATP.
ORSA Plan elements include:
$ Coverage for outpatient health care services (including pharmacy) only;
$ Financial obligation of patient based on patient declaration (with verification, including credit inquiries, conducted retroactively on a random basis);
$ Single-page application form;
$ Requirement to apply for Medi-Cal, if potentially eligible, and ORSA ineligibility if patient has third-party coverage;
$ Determination of liability based on current Federal Poverty Level (FPL), with zero liability for net incomes at or below 133.33% and liabilities assessed for patients with incomes over 133.33% FPL;
$ Six months= coverage unless income status changes; and
$ Mail-in renewal.
Based on preliminary field testing, ORSA processing time would be less than half that of ATP. Additionally, it is anticipated that patients will find the single-page application easier to understand and complete. ORSA is similar to the COI used by the PPPs, except that the COI: (a) does not require application for third-party programs, if potentially eligible; (b) does not include verification, (c) does not have a sliding fee schedule for those with income above 133 1/3% of FPL; and (d) does not include a mail-in renewal process.
Due to legal and fiscal issues, ORSA implementation does not replace ATP, and should be done Department-wide. As a practical matter, Department-wide implementation will also preclude any patient from having to apply for ORSA and ATP during the same six-month coverage period. ATP would remain available to inpatients and to ambulatory care patients who may choose ATP instead of ORSA. Additionally, in conjunction with the implementation of ORSA, the following changes should be made to the ATP Services Agreement and corresponding written notice:
Other Modifications:
$ Simplification of ATP Services Agreement
The ATP Services Agreement will be simplified to eliminate non-essential elements related to residency and to update the year indicator to the current century.
$ Patient Written Notice
The patient notice covering all no-cost/low-cost plans should be clarified regarding the definition and coverage of pharmaceuticals (i.e., emergency, public health, etc.) for outpatients and simplified to make it more concise. Additionally, corrections to the ATP requirements for verification of address, income, deductions, and resources should be made to clarify the specific information required.
2. Add Staffing
Hire additional staff to provide financial screening coverage and eligibility application processing at all ambulatory care settings, (i.e., CHCs, HCs and DHS hospitals), enhanced training for financial screening staff, and enhanced management support.
The addition of Patient Financial Services Workers (PFSW) at DHS ambulatory care settings will expedite processing of program applications (i.e., ORSA, ATP, Medi-Cal, Healthy Families, etc.). During hours of operation, if DPSS= outstationed EWs assigned to DHS= CHCs/HCs are not available, a PFSW will initiate the Medi-Cal application and forward the application to the EW. PFSWs assigned to hospital ambulatory care settings will initiate Medi-Cal applications and mail-in to a DPSS central processing unit. This will assist in satisfying one of the 1115 Waiver Extension Performance Standards, which is subject to sanctions. DPSS will claim the State administrative cost reimbursement.
Additional staffing for CHC/HC coverage is recommended, rather than shifting hospital staff to the CHCs/HCs as no improvement in the overall financial screening system would result from merely shifting the staffing shortages.
3. Simplify Registration/Financial Screening
Implement a uniform referral protocol for eligibility programs to ensure consistency. Implement a mail-in renewal process for ORSA to: (1) identify six-month eligibility expiration dates; (2) advise/notify patients of the need to reconfirm their program eligibility; and (3) complete renewals prior to the patient=s arrival at the facility.
4. Enhance Training Program
Develop and institute an expanded training program to enhance financial screening staff=s knowledge of all eligibility programs (including ORSA, ATP, Medi-Cal, Healthy Families, etc.), and improve their customer service and third-party resource financial screening skills.
5. Standardize Organizational Structure
Standardize the reporting line of Aprogram eligibility@ staff to hospital PFS management to ensure consistency in the application of reduced cost programs= policies and procedures, establish an integrated, unified organizational structure to provide technical support and program expertise, and coordinate coverage during vacation, sickness, jury duty, etc.
Anticipated costs of the intended follow-up actions include:
1. Anticipated revenue reduction
Although the Department has no data to accurately project anticipated revenue reductions from the implementation of ORSA, the current estimate is that a reduction of approximately 50% in the number of patients electing to pay a Pre-Payment Plan fee can be expected. This would result in a net reduction of approximately $6.6 million in annual revenue.
Also, due to limited data, the Department has not included an estimate for potential additional revenue which could result from a potential increase in Medi-Cal and Healthy Families applications.
2. Increased Staffing Costs
To provide a) financial screening coverage at each CHC/HC and supplement the hospital PFS staff, b) enhanced management support, and c) enhanced training on an ongoing basis, an additional 46 full-time equivalents (FTEs), at an estimated annual cost of $1.9 million will be required.
SEIU and the legal representatives in the Etter class generally concur with and support the findings and recommended plan.
EXHIBIT 2
LOS ANGELES COUNTY - DEPARTMENT OF HEALTH SERVICES
REVENUE MANAGEMENT
OUTPATIENT REDUCED-COST SIMPLIFIED APPLICATION
(ORSA) MONITORING ACTIVITY
Data To Be Monitored:
$ Upfront Collections (including Pre-Payment and Self-Pay)
$ Visits (Hospital Outpatient Statistics Report, Health Center and Comprehensive Health Center Clinic Visit Workload Data, etc.)
$ Medi-Cal and Healthy Families Applications
$ ORSA Applications
$ Patient Satisfaction
$ Staff Satisfaction
$ Registration Time
$ Medi-Cal and Healthy Families Revenue
Source Of Data/Report Generated By:
1. Self-Pay Payment Report/USCB
Comprehensive Health Centers and Health Centers Summary of Self-Pay Collections Report/Consolidated Billing Office (CBO) (1)
Upfront Collection Report/Hospitals
1. Hospital Workload Detail By Month/Information Systems Branch
Informational Reports - Outpatient Statistical Report - Financial Class
Summary/Internal Services Department
2. Medi-Cal & Healthy Families Referral Sheet/DHS Facilities
3. ORSA Applications/DHS Facilities
4. Pre-Pilot Patient Satisfaction Survey/Revenue Management
Post-Pilot Patient Satisfaction Survey/Revenue Management
5. Pre-Pilot Staff Satisfaction Survey/Revenue Management
Post-Pilot Staff Satisfaction Survey/Revenue Management
6. Pre-Pilot Registration Time Survey/Revenue Management
Post-Pilot Registration Time Survey/Revenue Management
7. Pre-Pilot Reduced-Cost Program Financial Screening Appointment Time Survey/Revenue Management
Post-Pilot Reduced-Cost Program Financial Screening Appointment Time Survey/Revenue Management
(1) Report is generated from the Comprehensive Health Centers and Health Centers Upfront and the Comprehensive Health Centers and Health Centers Analysis of Self-Pay Collections Reports which are also generated b