Text of an adopted amendment, recommended by
the House committee on Bills in the Third Reading, to the Senate Bill relative
to rates for human and social service programs (Senate bill No. 2764,
amended).
The
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In the Year Two Thousand and Eight.
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Striking
out all after the enacting clause and inserting in place thereof the
following:—
SECTION 1.
Chapter 7 of the General Laws is hereby amended by inserting after
section 22M the following section:-
Section 22N. The operational services division shall include a bureau of purchased services, hereinafter known as the bureau. The bureau shall have primary responsibility for the implementation and coordination of an efficient and accountable system of procurement, selection, special education pricing, contract administration, program monitoring and evaluation, contract compliance and post audit for any department, agency, board or commission of the commonwealth which procures or pays for social service programs from providers. Pricing for social service programs, other than special education programs, shall be set by the executive office of health and human services under chapter 118G.
For the purposes of this section, the term "social service program" shall mean any
social, special educational, mental health, mental retardation, habilitative, rehabilitative,
vocational, employment and training, or elder services program or accommodations,
purchased by a governmental unit, including any program provided pursuant to chapter
71B, but excluding any program or service which is reimbursable under Title XIX of the Social Security Act. The term "governmental unit" shall mean the commonwealth and any school district or other political subdivision of the commonwealth.
The bureau shall be headed by an assistant commissioner, who shall be appointed
by and serve at the pleasure of the secretary of administration and finance, and who shall
have administrative responsibility for said bureau. The position shall be classified in
accordance with section 45 of chapter 30, and the salary therefor shall be determined in accordance with section 46C of said chapter 30.
The bureau shall be comprised of such offices as may be necessary to carry out the mission of the bureau, which may include, but not be limited to: an audit office, and a unit for special education pricing. The assistant commissioner shall report annually to the house and senate committees on ways and means on the activities and operations of the bureau, including any recommendations for legislation. Said report shall also summarize any findings, opinions and recommendations of the social service policy advisory board established pursuant to this section.
There shall be a social service policy advisory board consisting of the secretary of health and human services or his designee, the secretary of elder affairs or his designee, the commissioner of education or his designee, a representative of the Massachusetts association of school committees who shall be selected by that organization, a representative of the associated industries of Massachusetts who shall be selected by that organization, a representative of the Massachusetts association of approved private schools who shall be selected by that organization, and 12 members appointed by the governor, 1 of whom shall be a representative of a provider contracting with 1 or more agencies within the executive office of health and human services, 1 of whom shall be a representative of a provider contracting with the executive office of elder affairs, 1 of whom shall be a consumer of services provided by 1 or more agencies within the executive office of health and human services, 1 of whom shall be a consumer of services provided by an agency contracting with the executive office of elder affairs, 1 of whom shall be a representative of the Massachusetts superintendents of schools association or a special education administrator for a city or town of the commonwealth, and 1 of whom shall be a parent of a child with special education needs. Each appointed member of said board shall be appointed for a term of 3 years and may be reappointed; provided, that among the initial appointed members, 4 shall be appointed for a term of 1 year, 4 shall be appointed for a term of 2 years, and 4 shall be appointed for a term of 3 years. The chairperson of said board shall be selected by the governor and shall serve in this function for a term of not more than 1 year.
Said board shall meet quarterly and shall make recommendations to the assistant
commissioner on matters of policy of the bureau. Except in the case of emergency
regulations, at least 30 days before the promulgation of any proposed regulation, the
assistant commissioner shall provide a copy thereof, together with an explanatory statement, to said board. The assistant commissioner shall give due consideration to comments on such proposed regulation submitted by said board or any members thereof.
The bureau shall have the responsibility for prescribing the methods to be used in
determining the prices to be reimbursed to providers of special education programs by
governmental units. The methods prescribed by the division in determining prices shall
incorporate cost containment standards and shall be fair to both governmental units and
providers. All governmental units shall pay the prices developed in accordance with the methods prescribed by the bureau. Pricing for social service programs, other than special education programs, shall be set by the executive office of health and human services under chapter 118G.
The prices determined by the bureau of purchased services, or pursuant to its methods, for programs pursuant to chapter 71B shall be set annually by the first Wednesday in February for the next fiscal year. If said bureau fails to determine said final annual prices on or before the first Wednesday in February, said prices in effect shall continue to be in effect for the next fiscal year. Program prices for programs approved under said chapter 71B which are located outside of the Commonwealth may be adjusted prospectively to account for rate or price adjustments authorized by the host state's rate setting body. In addition, program prices may be adjusted prospectively to account for unanticipated emergencies beyond the reasonable control of the provider, or to reflect costs attributable to extraordinary changes in volume, or to account for compliance with federal or state statutory or local regulatory requirements as determined by the bureau and pursuant to standards developed by the bureau. No such price may be adjusted retroactive to its effective date except to account for the results of administrative reviews, if any, as provided in the regulations of the bureau. Nothing herein shall preclude the bureau from setting a price for a new program established for the first time under said chapter 71B, or individual or sole source prices as provided in the regulations of the bureau after the first Wednesday in February of any fiscal year.
The bureau shall submit an estimated rate of inflation for social service programs to the secretary of administration and finance annually by December first for consideration in the preparation of the governor's annual budget recommendation. The bureau shall also notify superintendents of this estimated rate of inflation by December 1.
Any provider or governmental unit aggrieved by the bureau's action or failure to act with respect to the determination of a price pursuant to the bureau's pricing methods, and desiring a review thereof, may file, pursuant to regulations promulgated by the bureau, an appeal with the division of administrative law appeals in accordance with section 4H of chapter 7. The question on appeal of the decision of the bureau of purchased services shall be whether said bureau, in taking the action challenged by the aggrieved party, has properly applied its regulations. This paragraph shall not be construed to confer a right upon any aggrieved party to challenge, in a proceeding before the division of administrative law appeals, the procedural or substantive validity of any regulation of general applicability promulgated by the bureau of purchased services. Any such challenges shall be brought exclusively in the superior courts of the commonwealth in accordance with the provisions of chapter 30A.
The bureau shall establish guidelines and standards, consistent with generally
accepted governmental auditing standards, for independent financial and performance audits of providers of social service programs and governmental units purchasing programs. The bureau shall coordinate or conduct audits of providers as needed to monitor compliance with applicable fiscal policies. The bureau shall develop and administer a uniform system of financial accounting, allocation, reporting and auditing of providers which conforms to generally accepted governmental auditing standards. The bureau may conduct quality assurance reviews of provider financial statements and their auditors' reports and work papers. The disclosure of client records by providers to auditors, including independent auditors as defined by Federal Office of Management and Budget Circular A-133, as amended, as necessary to comply with state and federal audit requirements shall not constitute an invasion of privacy, or otherwise be grounds for civil or criminal penalty.
The assistant commissioner may, in accordance with said chapter 30A, and after notice to the social service policy advisory board, promulgate rules and regulations required to develop, implement, administer and monitor the programs and functions of the bureau. Said regulations shall provide for right of appeal, to the bureau or appropriate other bodies, for any procuring governmental unit or provider aggrieved by any action or failure to act under color of this section or said regulations.
All proposed regulations of the office for children and the department of education, and any other licensing or certification standards proposed by any department procuring social service programs, shall be forwarded to the bureau of purchased services with a statement describing the anticipated financial impact of the regulations 14 days prior to publication of the notice of rule making required under said chapter 30A.
The bureau shall adopt regulations limiting
the reimbursement to providers for the salaries of their officers or managers
to the salary level in step 7 of Job Group M-XII in the management salary
schedule in section 46C of chapter 30.
The bureau shall adopt rules and regulations
governing contracts between
governmental units and social service program providers
which shall include, but not be
limited to: a provision requiring that all transactions between said providers
and related
parties shall be disclosed in writing in advance to the bureau and to such
governmental
units; a provision requiring a complete inventory of equipment which is to be
used by a
provider and to which a governmental unit has title, and requiring the return of
such
equipment to the proper governmental unit upon the
completion or termination of the
contract; and a provision requiring that any contracts for which funds expended
by the
commonwealth thereunder reimburse or compensate
said providers for the amortization of mortgages for the ownership of any real
property, whether owned directly or indirectly by said provider, shall contain
provisions for the recoupment of said reimbursement or compensation by the
commonwealth in the event said property is sold and may, if necessary, allow
for the execution of liens to ensure such recoupment; provided, that any such
lien shall be subordinated to any statutory lien, to the lien of a first
mortgagee who has provided a purchase-money mortgage for such property, and to
the interest of any banking institution, as defined in section 1 of chapter
167A, holding a security interest in such property in an amount not exceeding
10 per cent of the appraised value of such property as determined and provided
by such banking institution; and provided further, that any such recoupment
shall be net of any outstanding balance due pursuant to any such superior
security interest. If after a hearing
the bureau finds a violation of any regulation adopted under this paragraph,
the bureau may order that the contract be terminated, or may assess a civil
penalty of not more than $2,000 or 10 per cent of the amount payable under the
contract, whichever is greater, which the agency shall withhold from payments
otherwise due under the contract.
Notwithstanding the foregoing, any provider aggrieved under this
paragraph may exercise any legal remedies or cause of action available to such
provider under law. If the bureau
determines after a hearing that a provider has committed repeated willful
violations of this paragraph, it may debar the provider from further state
contracts but such debarment shall not be for a period longer than 5 years.
SECTION 2. Section 1 of chapter
118G of the General Laws, as appearing in the 2006 Official Edition, is hereby
amended by inserting after the definition of “Medicare program” the following definition:-
“New governmental mandate”, a state or federal statutory requirement, administrative rule, regulation, assessment, executive order, judicial order or other governmental requirement that was not in effect when a rate of payment under this chapter was established by the secretary and directly or indirectly imposes an obligation and associated compliance cost upon a provider to take an action or to refrain from taking an action in order to fulfill the provider’s contractual duty to a procuring governmental unit.
SECTION 3. Said section 1 of said chapter
118G, as so appearing, is hereby further amended by inserting after the
definition of “Small business” the following 2 definitions:-
“Social service program”, a social, mental health, mental retardation, habilitative, rehabilitative, substance abuse, residential care, adult or adolescent day care, vocational, employment and training, or elder service program or accommodations, purchased by any governmental unit or political subdivision of the executive office of health and human services, but excluding any program, service or accommodation that: (a) is reimbursable under a Medicaid waiver granted under section 1115 of Title XI of the Social Security Act; or (b) is funded exclusively by a federal grant.
“Social service program providers”, providers of social service programs in the commonwealth.
SECTION 4. Section 2A of said
chapter 118G, as so appearing, is hereby amended by adding the following
paragraph:-
The secretary shall have the sole responsibility for establishing rates of payment for social service programs which are reasonable and adequate to meet the costs which are incurred by efficiently and economically operated social service program providers in providing social service programs in conformity with federal and state law, regulations, and quality and safety standards. When establishing rates of payment for social service programs, the secretary shall adjust rates to take into account factors, including, but not limited to: (a) the cost to social service program providers of any new governmental mandate that has been enacted, promulgated or imposed by any governmental unit or federal governmental authority since rates were last established by the former rate setting commission under chapter 6A, as then in effect; (b) inflation in costs of social service programs since rates were last established by the secretary; and (c) geographic differences in wages, benefits, housing and real estate costs in each metropolitan statistical area of the commonwealth, and in any city or town therein where such costs are substantially higher than the average cost within that area as a whole. The secretary shall not consider any of the resources specified in section 12 when establishing, reviewing or approving rates of payment for social service programs.
SECTION 5. Section 7 of said chapter 118G, as so appearing, is hereby amended by inserting after the word “services”, in line 4, the following:- and social service programs; provided, however, that for the purposes of this section, social service program providers shall be treated as non-institutional providers.
SECTION 6. Said chapter 118G is hereby further amended by inserting after section 24 the following section:-
Section 24A. Every 6 months, the secretary of health and human services shall submit a report to the governor, the secretary of administration and finance, the clerks of the house and senate, who shall forward the same to the joint committee on children, families and persons with disabilities, the joint committee on health care financing, the senate and house committees on ways and means, and the clerks of the senate and the house of representatives, regarding the status and evidence of the implementation of the prospective rate system set forth in section 7. The reports shall include, but not be limited to, information regarding the percentage of social service program providers reimbursed at the time of reporting by the secretary of health and human services through a rate setting process and the percentage of such providers reimbursed through a contract with another state agency and initiatives undertaken to promote efficiency or reduce or control costs and the results thereof.
SECTION 7. Section 99 of chapter 138 of the acts of 1991 is hereby repealed.
SECTION 8. Notwithstanding any special of general law to
the contrary, on or before
SECTION 9. On or before
SECTION 10. On or before
SECTION 11. On or before
SECTION 12. On or before
SECTION 13. During the implementation process described
in sections 8 to 12, inclusive, until all contracts for social service program
providers are fully subject to the prospective rate setting process as set forth
in section 7 of chapter 118G of the General Laws, if a contract between a
governmental unit and a social service program provider has a term of more than
1 year, or has a term of 1 year or less and is extended or renewed so that the
contract is continuously in effect for more than 1 year, then the procuring
governmental unit may annually adjust the rate of payment, including a cost
increment factor, under the contract established under said chapter 118G,
effective on the contract anniversary date, by an amount to be determined by
the secretary.
SECTION 14. The
first report under section 24A of chapter 118G of the General Laws shall be
filed on or before