HF4781

Purpose

• Change how medical assistance pays for Certified Community Behavioral Health Clinics (CCBHCs) to use a per-day (daily bundled) rate, rebasing of rates every two years, and a quality incentive program. The bill also updates rules for data reporting, appeals, and how these payments interact with managed care and wrap payments.

Key definitions and covered services

• Medical assistance (MA) covers services provided by a not-for-profit CCBHC that meets the requirements in statute.
• The CCBHC daily bundled rate system applies to payments for eligible CCBHC services, with no county share when paid through this rate.

Main provisions

• Per-day bundled rate and eligibility

  • CCBHCs are reimbursed on a per-day basis for each day an eligible service is delivered, using a provider-specific daily bundled rate.
  • A daily bundled rate must cover the daily cost of providing CCBHC services plus related costs (salaries and benefits, other allowable costs, insurance, supplies), and must be calculated using total annual CCBHC costs divided by total annual visits.
  • A CCBHC visit is eligible for reimbursement if at least one of the required CCBHC services is provided by a licensed clinician or agency employed by or under contract with the CCBHC.

• Rebasing and rate calculation

  • Initial CCBHC daily bundled rates for newly certified CCBHCs are set using audited historical cost data from the clinic and adjusted for expected costs, with estimates subject to review.
  • Rates are rebased every two years after the last rebasing, and at least 12 months must pass after a rate change due to a change in the scope of services.
  • For certain clinics certified in 2020–2021, rebasing rules apply with specific transition provisions (including updates through 2026 and then rebasing starting in 2027).
  • A 60-day appeals process is provided after notice of rebasing results.
  • If a CCBHC’s daily bundled rate overlaps with another federal Medicaid rate, the clinic is not eligible for the CCBHC rate.

• Interaction with managed care and wrap payments

  • Managed care plans and county-based purchasing plans must reimburse CCBHCs at the CCBHC daily bundled rate.
  • The state must monitor access and adjust capitation rates if needed; wrap payments (the old additional payments for CCBHCs) must be phased out within 60 days of implementing the daily bundled rate in the MA system, with final settlements due within 18 months.
  • If federal approval for the wrap payment phaseout is not received, the state will adjust capitation payments to reflect the change, and the contract must allow recovery of payments if capitation rises result in higher payments.

• Updates and data reporting

  • The CCBHC daily bundled rate must be updated each year between rebasing periods by the Medicare Economic Index (MEI) for primary care services.
  • CCBHCs must provide annual cost and visit data via a cost report established by the commissioner.

• Rate adjustments for changes in scope

  • A CCBHC can request a rate adjustment if changes in scope are expected to change the rate by 2.5% or more. The clinic must provide cost impact data and expected change in visits; adjustments can occur no more than once per year between rebasing periods and take effect on the date of the annual rate update.

• Quality incentive payments

  • The commissioner will run a quality incentive program for CCBHCs that meet specific performance thresholds beyond the base daily bundled rate.
  • To be eligible for incentives, a CCBHC must be certified and enrolled for the entire measurement year.
  • CCBHCs receive written notice of required criteria at least 90 days before the measurement year and must provide data within six months after the measurement year.
  • The commissioner will notify providers of performance results and incentive amounts within 12 months after the measurement year.

• Claims, clean claims, and payment timing

  • All MA claims for CCBHC services paid by the commissioner on specified dates; if a managed care plan fails to pay clean claims per federal requirements, the commissioner may pay those claims directly.
  • Clean claims requirements follow federal standards; if noncompliance persists, a mechanism to pay or recover funds is triggered with set timelines.

• Peer services

  • Peer services provided by a CCBHC are a covered MA service when determined medically necessary by a licensed mental health professional or an alcohol/drug counselor.
  • Eligibility for peer services under this provision supersedes other eligibility standards in certain sections.

Significant changes to existing law

• Replaces the existing MA payment method for CCBHCs with a per-day bundled rate tied to actual costs and visits, replacing per-service payments.
• Introduces a mandatory two-year rebasing cycle for CCBHC rates, plus transitional rules for clinics certified in 2020–2021.
• Establishes a formal, state-managed quality incentive program with measurable performance targets.
• Requires annual MEI-based updates between rebases, and mandatory cost reporting to support rate calculations.
• Codifies a phased transition away from CCBHC wrap payments and coordinates with managed care capitation rates.
• Expands eligibility and funding mechanisms for peer services as MA-covered services when medically necessary.

Practical implications

• CCBHC funding becomes more tied to a clinic’s overall costs and patient visits rather than individual billed services.
• States’ oversight and data reporting obligations increase to ensure accurate rate setting and quality performance.
• Transition rules and timelines shape how clinics adapt to new payment structures, particularly during rebasing periods.

Notable terms and concepts to watch

• Certified Community Behavioral Health Clinic (CCBHC)
• Medical assistance (MA)
• CCBHC daily bundled rate
• Rebasing (and initial rate for new clinics)
• Cost report and annual cost/visit data
• Medicare Economic Index (MEI) for primary care
• Quality incentive payments
• CCBHC wrap payments and phaseout
• Managed care plans and county-based purchasing plans
• Clean claims
• Scope of services and rate adjustments for changes in scope
• Peer services (medically necessary)

Relevant Terms CCBHC, medical assistance, daily bundled rate, rebasing, cost report, visits, MEI (Medicare Economic Index), primary care services, quality incentive payments, wrap payments, MMIS, clean claims, managed care plans, county-based purchasing plans, scope of services, peer services, audited historical cost data.