Section 355.8704 - Reporting and Monitoring(a) A governmental entity that provides funds for use as the non-federal share in the Medicaid program must report information to the Texas Health and Human Services Commission (HHSC) in a form and format to be determined by HHSC.(b) The information must be reported at least annually, no later than October 31, or upon request by HHSC.(c) HHSC will review reported information based on governmental entity funding sources, including: (1) local provider participation funds (LPPFs) authorized by the Texas Health and Safety Code Chapter 288 et seq. or other provider tax structures;(2) non-LPPF provider taxes;(3) ad valorem tax revenue;(6) other local funding sources.(d) HHSC will use the information from the report to monitor each governmental entity's funding sources and determine the likelihood that the funds are permissible for use in the Medicaid program. The monitoring will include the following:(1) Survey. An electronic annual survey that will request the following:(A) a list of all Medicaid programs and health care providers (including name, type, and ownership status) for which the governmental entity transferred or certified funds as the non-federal share;(B) the relationship between the governmental entity and each health care provider, including a copy of any formal or informal agreements between the governmental entity and the health care provider;(C) the source of the funds used as the non-federal share transferred by the governmental entity;(D) information on any debt instruments (i.e., bonds, loans, etc.) that a governmental entity utilizes and the relationship of the instrument to any transferred funds;(E) to the extent patient revenue is used, a description of payor mix (i.e., Medicaid, Medicare, commercial, uninsured, self-pay, etc.) during the federal fiscal year (FFY) and any anticipated changes;(F) any transfer of funds or provision of services from a health care provider or entity related to a health care provider to the governmental entity, including in-cash or in-kind donations, or any other transfer of value;(G) overview of funds received from all sources available to the governmental entity during the FFY;(H) other information as determined necessary and appropriate to determine compliance with federal or state statutes and regulations, including attestations of compliance from the local government; and(I) any publicly available information, such as:(i) recordings of discussions or written minutes from public meetings to set assessment rates or gather feedback from health care providers or their representatives;(ii) correspondence describing the governmental entity's funding transferred to HHSC for use in the Medicaid program;(iii) links to websites that describe the funds used as the non-federal share or any agreement between the governmental entity and a health care provider or entity related to a health care provider; and(iv) copies of any public notices, local orders, announcements, or other related documentation.(2) Risk Assessment.(A) The risk assessment will include:(i) a risk assessment score based on self-reported annual survey responses; and(ii) any adjustments made at HHSC's discretion based on supplemental documentation and discussion with the impacted governmental entity and review of additional documentation requests as may be needed, in HHSC's sole discretion, to confirm, audit, or modify self-reported data and qualitative descriptions.(B) The funds used as the non-federal share will be categorized as likely permissible, further review required, or likely impermissible based on a review of a governmental entity's funding sources. HHSC may elect to contact entities whose funding sources are categorized as further review required or likely impermissible to obtain additional information. The entity must furnish the requested information to HHSC within 10 business days of the date of the request.(i) Likely permissible. Funding source appears to comply with federal and state statutes and regulations.(ii) Further review required. Funding source compliance with federal and state statutes and regulations is unclear.(iii) Likely impermissible. Funding source does not appear to comply with federal or state regulations.(3) In-depth Review. HHSC will select a sample of survey respondents for an in-depth review in which HHSC may examine supporting documentation, either on-site or electronically, at HHSC's discretion. HHSC will select a sample of survey respondents sufficient to result in a 95 percent confidence level with a 5 percent margin of error. HHSC will select entities based on an initial risk assessment, and if additional entities are necessary to complete the required sample size, they will be randomly selected. HHSC will notify a governmental entity if an on-site review will occur at least 10 calendar days prior to the visit.(4) Determination. HHSC will notify the governmental entity upon determination of the following:(A) reporting compliance;(B) risk assessment score;(C) funding source category pursuant to paragraph (2)(B) of this subsection.(5) Post-Determination Review. Post-determination review will be conducted as outlined in § 355.8705 of this subchapter (relating to Post-Determination Review).(e) If a governmental entity fails to submit the required information or supplemental documentation as requested by HHSC by the deadline specified in this section, HHSC may refuse further transfer of funds for any Medicaid program from the governmental entity until the reporting requirement is satisfied and may process recoupments for any payments resulting from funds transferred determined to be non-compliant.(f) Prior to the applicable deadline, a governmental entity may request an extension of up to 10 business days for any deadline contained in this subchapter. HHSC may grant or reject such request at its sole discretion.(g) After review of any additional information provided, HHSC may also seek input on the likely permissibility of the funds from the Centers for Medicare & Medicaid Services (CMS). In the event HHSC elects to request input from CMS regarding the compliance of a specific funding source as contemplated by this subchapter, HHSC will notify the governmental entity prior to requesting such review. HHSC may, at its discretion, accept or reject local funds from any governmental entity; however, HHSC will reject funding and recoup all Medicaid payments supported by a governmental entity's funding source that CMS deems impermissible if CMS requires HHSC to do so.(h) If a governmental entity is determined not to have met the reporting requirements, or to have falsified any data in its reporting, HHSC may refuse transfers from the governmental entity, and payments to health care providers resulting from prior transfers may be recouped.1 Tex. Admin. Code § 355.8704
Adopted by Texas Register, Volume 47, Number 19, May 13, 2022, TexReg 2854, eff. 5/19/2022; Amended by Texas Register, Volume 49, Number 44, November 1, 2024, TexReg 8704, eff. 11/6/2024