June 15, 2007
MERC Committee Meeting
Committee Members
Present:
John Abenstein, Gary
Anderson, Deb Mayland-Poyzer for Mary Edwards, Daniel Foley, Tim Gaspar, Lee
Greenfield, Larry Kuusisto, Louis Ling, Dawn Ludwig, Kathy Meyerle, Carl Patow,
Curtis Savstrom, and Marilyn Speedie.
Interested Parties
Present:
Barb Adrian, Suzanne
Bardouche, Ben Bornsztein, Rena Garni, Ron Hadsall, David Knowlan, Janet
McCarthy (via phone), Margo Marko, Gerhardt Meier, Marty McDonough, Jeff Ogden,
Rick Roberts, John Rodewald, Trisha Schirmers, and Susan Stout.
Staff Present:
Scott Leitz, Diane Reger and
Diane Rydrych – Minnesota Department of Health
Susan Hammersten and Richard
Tester – Minnesota Department of Human Service
I. Introductory
Remarks from MERC Committee Chair – Dr. Louis Ling
Dr. Ling opened the meeting by welcoming and thanking members and interested parties for attending. All committee members and interested parties then introduced themselves.
II. Update on Fiscal Year 2007 MERC/PMAP Distribution – Diane Reger, MDH
Ms. Reger will be
sending each sponsoring institution their 2007 site data within two weeks. It’s very important that the sites be
verified prior to the distribution. In
2006, numerous sites had to return funding because they were submitted in error
and MDH was not aware of this until the grant was calculated and
distributed. When incorrect MAID numbers are submitted for
sites, the wrong revenue is used to calculate the distribution. If an MAID number needs to be changed, the
entire distribution is affected, as well as discretionary funding available to
the sponsoring institution. We are
asking that programs communicate with the training sites to verify their site
data so we do not have issues going forward. The site name, address, billing address (where checks are mailed), MAID
number, and FTEs should be verified to avoid future problems.
Ms. Reger asked if
there was any preference in how the grant contracts were sent to each
sponsoring institution (Federal Express vs PDF document via email). Everyone agreed that receiving a PDF and Federal
Expressing the signed copy back to MDH would be fine.
MERC staff
estimates that the 2007 MERC/PMAP grant will be distributed sometime this fall,
due to the timing of federal match process. We’re estimating approximately $59 million, if a full match is
received. Once more information is known,
we’ll communicate that to sponsoring institutions.
Ms. Rydrych provided an update on the MERC dental innovations grants, which are now administered by MDH’s Office of Rural Health and Primary Care. A total of $2,036,700 was awarded in SFY07 to 11 sites throughout the state. Ms. Rydrych noted that this amount included funds that had been unawarded in previous years and rolled forward. The application deadline for FY08 grants just passed, and the review team (which Ms. Rydrych is part of) will be meeting in mid-July to review the applications submitted this year. Applicants will likely be notified in late July if they have been awarded grants.
IV. Outcomes of the 2007 Legislative Session – Diane Rydrych, MDH
Ms. Rydrych provided the committee with a brief history of the various MERC proposals
discussed during the legislative session, including the proposals put forward
by the Governor’s office, the House, and the Senate.
Ms.
Rydrych reminded the committee that the Department had put forward a proposal
for a revised MERC formula that retained the status quo distribution formula
for all PMAP funds. The proposal would
also have established a pool of $10-$15M in funds, including $5M in cigarette
tax funds and $5M in new funds from the HCAF as well as any match received on
the $4.85M in
Additionally,
the Senate proposal would take $5.35 M from the available MERC funds and
distribute it to several individual sites. Those funds would be distributed as follows: $2.475 to the University of
Minnesota Medical Center,
Finally,
the Senate proposal directed $6.75M in FY2008/FY2009 and $2.5M in FY2010 and
CY2011 to the Mayo Clinic from the General Fund. These funds would also be unmatched.
MDH was
directed to submit a report to the Legislature in January 2009, describing the
impact of these changes, particularly on sites with a smaller number of FTE’s
or lower MA revenue, and recommending any changes necessary to ensure the
financial viability of GME in
The
Senate proposal was ultimately adopted, and signed by the Governor. Ms. Rydrych provided a handout that walked
through the main points of the statutory changes. Mr. Leitz asked for clarification about
whether or not a portion of state funds would be left unmatched under this
proposal; Ms. Rydrych clarified that, since federal match is questionable for
the $5.35M in direct payments, it is likely that those funds would be left
unmatched. Committee members asked for
clarification about the impact on small sites and how PMAP revenue would be
calculated. They also asked if cost data
would need to be submitted on future applications since it is not part of the
new formula. Ms. Rydrych said although
costs are not part of the new formula, they are still necessary to break the
site grant down to the program level. The site as a whole receives grants that may come from many different
programs and institutions, to break the amount down to the program level, MERC
staff look at the number of FTEs and cost associated with that program’s
provider type. The overall grant to the
site when combined across each teaching program it supports is still the same;
however, it is just broken down and distributed through many programs. Requesting cost and revenue data is at the
discretion of the Commissioner of Health. They are not being requested on the 2008 MERC application and MERC staff
will continue to use the cost data submitted on the 2004 Application as a
proxy.
Susan Hammersten and
Richard Tester, of DHS, provided an update on federal issues that the committee
has previously discussed; the potential elimination of GME from the Medicaid
program, and CMS’s intent to adopt regulations that would limit payments under
the MA program to costs and enact new restrictions on certified public
expenditures (CPE’s). Recent action by
Congress delayed the implementation of both changes for a year, but Ms. Hammersten
noted that it is not clear how that one-year delay will be interpreted by
CMS. Ms. Hammersten noted that it is
possible that CMS will still publish their proposed regulations on the same
timetable, and have them go into effect at the one-year mark or 60 days
thereafter, and it is also possible that the proposed regulations themselves
would not be published until after the one-year period has passed. Ms. Hammersten and Mr. Tester also noted
that the scope of the GME-elimination proposal is unclear; the preamble seems
to imply that indirect medical education (IME) would not be affected by the
elimination of GME, but the proposed regulatory language refers to GME more
broadly and does not explicitly exempt IME. In the case of both MERC and PMAP, it is unclear whether federal match
will be available in the future.
A committee member asked the DHS staff whether or not GME payments would also be removed from cost reports. Mr. Tester replied that this was likely, and that direct costs (which total roughly $8M per year for FFS) would likely be backed out from cost reports. A committee member asked whether the committee should be thinking about what our response would be if CMS decides that they can only accept cost reports for hospitals. Ms. Hammersten responded that this is a potential issue but has not been explicitly raised yet, and that CMS has indicated some willingness to accept cost reports for non-institutional providers as well.
In the case of both proposals, comments are due to CMS no later than June 22. Committee members discussed several templates that are available for comment letters, and MERC staff agreed to send to the committee any templates or samples that other committees can email within the next few days.
The next regularly scheduled MERC
meetings will be held on from 1 – 4 p.m. in the Red River Room at
