Ariz. Admin. Code § 9-22-712.06

Current through Register Vol. 30, No. 36, September 6, 2024

Section R9-22-712.06 - Supplemental Graduate Medical Education Fund Allocation

A. Gradual Medical Education (GME) reimbursement as of July 1, 2020.

1. In addition to distributions according to Section R9-22-712.05, and subject to the availability of funds and approval by CMS, the Administration shall annually distribute monies appropriated for the GME programs approved by the Administration to hospitals for direct and indirect costs for graduate medical education programs which were established or expanded on or after July 1, 2020. The Administration shall estimate the distributions using information possessed by the Administration as of December 15 of each calendar year. The actual distributions will be made using information possessed by the Administration as of September first of the year in which the new residency or fellowship begins.

2. Eligible Hospitals. A hospital is eligible for distributions under this Section if all of the following apply:

a. It is a hospital in Arizona that is the sponsoring institution of, or a participating institution in, one or more of the GME programs in Arizona;

b. It incurs direct costs for the training of residents in the GME programs, which costs are or will be reported on the hospital's Medicare Cost Report;

c. It is not administered by or does not receive its primary funding from an agency of the federal government;

d. It has established a new GME program or expanded the number of residents or fellows in an existing GME program on or after July 1, 2020.

3. Eligible positions. For purposes of determining distributions under this Section the following resident and fellowship positions qualify to the extent that the training takes place in Arizona at an eligible health care facility:

a. Filled resident or fellow positions in approved programs which began on or after July 1, 2020;

b. Eligible positions do not include residents or fellows that receive payments for services under the Access to Professional Services Initiative (APSI) program established in the Contractors' prepaid capitation contracts with the Administration.

4. Annual Reporting

a. By December 15 of each year, a GME program shall provide all of the following information for GME programs and positions which are expected to be eligible for funding under this Section as of the upcoming academic year (i.e., July 1 to June 30 of each year):

i. The program name and number assigned by the accrediting organization if available;

ii. The original date of accreditation if available;

iii. The names of the sponsoring institution and all participating institutions expected as of the date of reporting;

iv. The number of anticipated resident and fellowship positions eligible for funding as of the upcoming academic year;

v. The number of months or partial months during the upcoming academic year that each resident or fellow is expected to work in each hospital or in a non-hospital setting under agreement between the non-hospital setting and the reporting hospital;

vi. The academic year of anticipated resident and fellowship positions;

vii. The length of the program; and

viii. The names and other information requested by AHCCCS to ensure the total GME distributions for each eligible position are not greater than the costs for each eligible position in the Intern and Resident Information System (IRIS) file.

b. By December 15 of each year, a GME program located in a county with a population of less than 500,000 persons shall provide the estimated one-time and ongoing costs for each program which it expects to be eligible for funding.

c. By September 1 of each year, a GME program shall provide the actual name of residents and fellows hired in the current academic year and other information requested by AHCCCS to ensure that total GME distributions for the eligible position are not greater than the costs for each eligible position in the IRIS file.

B. Preliminary allocation of funds for urban hospitals. Annually by January 15, the Administration shall estimate the annual GME distributions under this Section using the funds appropriated for hospitals in counties with a population of 500,000 persons or more based on the number of new residents and fellows in graduate medical education programs in the following manner:

1. Each eligible resident and fellow is placed into tiers with the following priority:

a. Returning residents and fellows. A returning resident or fellow is a resident or fellow whose position received funding under this Section for the previous academic year and who is continuing in the same GME program.

b. Residents and fellows that are not a returning resident or fellow but are in a GME program for Family Medicine, Internal Medicine, General Pediatrics, Obstetrics and Gynecology, Psychiatry including Subspecialties, General Surgery, and any other program determined as high needs by the AHCCCS Administration.

c. Residents or fellows that are not returning residents or fellows and are not described in subsection (1)(b) but are in a GME program that received funding under this Section in a prior year.

d. All other residents and fellows.

2. The amount of the distribution for each GME program for direct costs is calculated as the product of:

a. The number of eligible residents and fellows adjusted for the number of months or partial months worked in each hospital or non-hospital setting under agreement between the non-hospital setting and the reporting hospitals;

b. The Arizona Medicaid utilization as determined by R9-22-712.05(B)(4)(c)(i) in the previous calendar year; and,

c. The average direct cost per resident determined under R9-22-712.05(B)(4)(d) in the previous calendar year.

3. If monies are still remaining after direct funding has been allocated, indirect funding shall be allocated based on the priority of each tier and sub-tier. The amount of the distribution for each GME program for indirect costs is calculated as the product of:

a. The number of allocated eligible residents and fellows adjusted for the number of months or partial months worked in each hospital or non-hospital setting under agreement between the non-hospital setting and the reporting hospital;

b. The indirect cost per resident per month calculated in R9-22-712.05(D)(4)(b)(vi) in the previous calendar year; and

c. Twelve months.

d. Funds shall be allocated based on the priority of each tier and sub-tier. Distributions for eligible positions in a tier or subtier with a lower priority will not receive a distribution until distributions are allocated for the costs of all positions in a higher tier or sub-tier. If funding is insufficient to fully fund a tier or sub-tier, the remainder of funds will be prorated for eligible positions in that tier or sub-tier.

4. Payments are made to participating hospitals based on the FTEs who worked at their hospitals per year.

C. Preliminary allocation of funds for rural hospitals. Annually by January 15, the Administration shall estimate the annual GME distributions under this Section using the funds appropriated for rural hospitals based on the number of eligible resident and fellow positions in graduate medical education programs located in a county with a population of less than 500,000 persons in the following manner:

1. Each resident and fellow will then be placed into a tier with the following priority:

c. Residents or fellows that are not returning residents or fellows and are not described in subsection (1)(b) but are in a GME program that received funding under this Section in a prior year.

d. All other residents and fellows.

2. Residents and fellows in each tier are further divided into four sub-tiers with the following priority based on the location of the sponsoring or participating hospital:

a. Hospitals in a county designated by the Health Resource and Services Administration of the U.S. Department of Health & Human Services as a HPSA with a greater than 85 percent primary care shortage.

b. Hospitals in a county designated as a HPSA with a greater than 50 percent to 85 percent primary care shortage.

c. Hospitals in a county designated as a HPSA with a 25-50 percent primary care shortage.

d. Hospitals in a county designated as a HPSA with a less than 25 percent primary care shortage.

3. Funds shall first be allocated for direct and indirect costs based in order of priority of each tier. If not enough funding is available to fully fund a tier or sub-tier, the remainder of funds will be prorated in a tier or sub-tier.

4. The amount of the distribution for each GME program for direct costs is calculated as the product of:

b. The Arizona Medicaid utilization determined under R9-22-712.05(B)(4)(c)(i); and,

c. The actual direct cost per resident per year.

5. The amount of the distribution for each GME program for indirect costs is calculated as the product of:

b. The indirect cost per resident per month calculated in R9-22-712.05(D)(4)(b)(vi) in the previous calendar year; and

c. Twelve months.

6. Payments are made to participating hospitals based on the FTEs who worked at their hospitals per year.

D. Final allocation of funds. Annually no sooner than September 1 following the start of the academic year, the Administration will recalculate the allocation for urban and rural hospitals using the same methodology used to estimate distributions, but using the actual residents and fellows as reported in R9-22-712.06(a)(4)(c).

F. Exclusions. To ensure that residents and fellows are not double counted residents/fellows which receive funding through R9-22-712.06 shall not receive funding through R9-22-712.05.

Ariz. Admin. Code § R9-22-712.06

Amended by final rulemaking at 27 A.A.R. 2496, effective 10/6/2021. Amended by final rulemaking at 29 A.A.R. 898, effective 3/31/2023.