Chapter 257 of the Acts of 2008 Regulates Pricing for the POS System
The Cost Analysis and Rate Setting Effort has Several Objectives and Challenges
Objectives and Benefits

•	Development of uniform analysis for standard pricing of common services
•	Rate setting under Chapter 257 will enable:
•	Predictable, reimbursement models that reduce unexplainable variation in rates among comparable, economically operated providers 
•	Incorporation of inflation adjusted prospective pricing methodologies 
•	Standard and regulated approach to assessing the impact of new service requirements into reimbursement rates 
•	Transition from “cost reimbursement” to “unit rate” 

Challenges

•	Ambitious implementation timeline 
•	Data availability and integrity (complete/correct) 
•	Unexplained historical variation in reimbursement rates resulting from long-term contracts and individual negotiations between purchasers and providers
•	Constrained financial resources for implementation, especially where pricing analysis warrants overall increases in reimbursement rates
•	Cross system collaboration and communication
•	Coordination of procurement with rate development activities

Agenda

•	Service Class Overview
–	Services
–	Procurement Plan

•	Foster Care Spectrum
–	DCF
–	DYS
–	Caregiver stipend levels
–	DDS

•	Product Based Adoption

•	Other Placement Services

•	Support Services

•	Next Steps & Logistics

 Youth Foster Placement, Adoption and Support Services Service Class
Youth Foster Placement, Adoption and Support Services Draft Procurement Proposal

•	100% of DYS providers are also DCF providers

•	Combined DYS and DCF purchased over $85M of contracted foster care and support services in FY11

•	DCF & DYS will jointly develop an RFR to create a master agreement with shared rate contracts for release in early 2013, following the promulgation of the Youth Placement & Adoption Rates. 
•	Chapter 257 rates will be adopted with a target effective date of July 1, 2013 for DYS contracts.  
•	DCF will complete their contracts with their current providers and these Chapter 257 rates throughout FY14 and rebid their contracts at a future date. 

•	DMH currently purchases Intensive Foster Care using the DCF rates, planned to be included in the Caring Together with Families joint procurement with DCF
•	These rates will mirror the IFC rates as they change with this rate development
•	The Caring Together RFR will include language to reflect this process

Agenda

Foster Care Administrative Budget: DCF IFC and DYS Traditional

•	DCF and DYS both develop their daily foster care rates considering both the administrative costs and stipends paid to caregiver families.  

•	The chapter 257 rate development process will mirror the current methodology to review and evaluate the administrative (staffing) costs associated with providing foster care and the appropriate stipend levels to support the living and care needs of the foster youth in their care. 

•	Model budgets, and resulting rates, will reflect the staffing necessary to support the 24/7 Provider Agency Services.  

Foster Care: DCF Enhanced (EFTC) and DYS Intensive

•	DCF Enhanced Intensive Foster Care  clients and DYS Intensive Foster Care clients share many of the enhanced needs :

•	Model budgets, and resulting rates, will reflect the staffing necessary to support the increased 24/7 Provider Agency Services.  

•	Stipend levels for caregivers of these more intensive clients will reflect the cost drivers associated with care provision for these youth. 

Other Foster Care Services:

Teen parent, Sibling, & Detention Alternative

•	Teen parent and sibling rates within the DCF IFC models are also being reviewed
•	Rates for teen parents and siblings will continue to consider the child and administrative costs associated with service provision

•	In addition to establishing standardized administrative and stipend rates for the Intensive and Traditional Foster Care programs, standard unit rates will be created for:
–	DYS Juvenile Detention Alternative Held & Filled Beds (Pilot Sites)
–	DYS Non-Guardian Care/Kinship

Foster Care: Stipend Levels

•	DYS & DCF, along with DHCFP and EOHHS, are developing standardized stipend levels that will address the costs of caregiver supports and will be reflective of individual need levels.
•	These stipends will increase as client need level increases, to account for the additional care needs associated with some individuals.

•	These standardized rates will reflect consistent and transparent assessment of consumer acuity and need.

Agenda

•	Service Class Overview
–	Services
–	Procurement Plan

•	Foster Care Spectrum
–	DCF
–	DYS
–	Caregiver stipend levels
–	DDS

•	Product Based Adoption

•	Other Placement Services

•	Support Services

•	Next Steps & Logistics

DCF: Adoption Management and Support 
(AMSS)

•	DCF currently purchases product based adoption services and specialty contracts to support adoption.

•	Product Based Adoption includes an array of rates grouped into 6 service specifications, to address specific client needs and provide comprehensive services.
–	Six service groups  - Consultation, Placement Case Management, Family Development, Recruitment, Intervention and Interstate.

Agenda

•	Service Class Overview
–	Services
–	Procurement Plan

•	Foster Care Spectrum
–	DCF
–	DYS
–	Caregiver stipend levels
–	DDS

•	Product Based Adoption

•	Other Placement Services

•	Support Services

•	Next Steps & Logistics

DCF Other Placement Services

•	DCF engages in single-provider contracts to address specific and specialized placement needs beyond IFC and ETFC.  
•	These other placement services will be reviewed an specialized rates set to continue to best serve these specialized populations

•	Services included in this category:
•	IFC “Other”
•	Puerto Rico placements
•	Medical Family residential Services

•	Family residential services are a distinct cluster of services that can accommodate up to 6 children in a shared foster care setting

•	Family residential services will have their own distinct rates

DCF Support Services

•	Several single-contract support services will each receive distinct rates to address the diverse support needs of the DCF consumers.

•	Services included in this category:
•	Multiple accommodations model (Adoption and Post-adoption)
•	Youth Permanency Connections
•	Multiple foster services parent supports

•	Rates and rate methodology will differ among these rates to address specific programmatic and operational needs
•	Certain services will receive per diem unit rates while others will receive accommodation rates.

Agenda
•	Service Class Overview
–	Services
–	Procurement Plan

•	Foster Care Spectrum
–	DCF
–	DYS
–	Caregiver stipend levels
–	DDS

•	Product Based Adoption

•	Other Placement Services

•	Support Services

•	Next Steps & Logistics

Next Steps & Logistics

•	The adoption and procurement of the Chapter 257 rates will not result in any billing and tracking system changes: 
•	DCF will continue to use Family Net 
•	DYS will continue to use JJEMS for tracking and PV for billing

•	DCF, DYS, HCFP and EOHHS will continue to work collaboratively to develop rates for the foster care spectrum, product based adoption services, other placement services and support services. 

•	Rates will be proposed to EOHHS leadership in August, 2012.

•	A public hearing will be scheduled for Fall 2012.