TITLE: CONCERNING PERSONAL NEEDS FUNDING FOR MEDICAID RESIDENTS IN NURSING CARE FACILITIES.

Fiscal Impact Summary	FY 1999/2000	FY 2000/2001
State Revenues General Fund
State Expenditures General Fund Cash Fund Cash Fund Exempt Federal Fund	$ 829,788 82,136 9,141 796,375	$ 987,106 98,563 10,969 947,010
FTE Position Change	0.0 FTE	0.0 FTE
Other State Impact: None
Effective Date: 90 Days Upon Adjournment
Appropriation Summary for FY 1999-2000: Department of Health Care Policy and Financing Total$1,589,600 Department of Human Services Total$ 127,840
Local Government Impact: The counties' 20 percent share for assistance payments is estimated at $9,141 in FY 1999-00 and $10,969 in FY 2000-01.

The bill increases the personal needs allowance to a resident of a nursing facility or an intermediate care facility for the mentally retarded from $34 to $50 monthly.

A total of $1,717,440 will be required in FY 1999-00 to implement the bill's provisions. Costs will be incurred in both the Department of Health Care Policy and Financing (DHCPF) and the Department of Human Services. Because the bill includes an effective date of 90 days upon adjournment unless a referendum petition is filed and approved by the voters, the fiscal note assumes the effective date for increasing the personal needs allowance to be September 1, 1999 (10 months of costs for FY 1999-00). Costs for FY 2000-01 assume a constant number of clients for the full 12 months.

Department of Health Care Policy and Financing — $1,589,600 in FY 1999-00. The cost in FY 2000-01 is estimated at $1,890,240.

States are federally required to provide Medicaid nursing facility residents with a fixed personal needs allowance (PNA). The minimum rate established in federal law is $30, and this rate was set in 1987 in the Omnibus Budget Reconciliation Act. States have the option of setting a PNA higher than $30. DHCPF indicates that most Medicaid nursing facility residents are subject to "patient payment", wherein each month, the resident contributes his or her social security or other retirement income toward the cost of his or her nursing facility care. These residents keep $34 each month of their income to cover the PNA.

Medicaid Premium for Nursing Facility Services. Based on May 1998 data reports of Medicaid paid nursing facility claims, there were approximately 9,845 nursing facility residents with incomes greater than $34 who will be affected by this bill. The bill requires that the PNA increase by $16 per month (from $34 to $50). Because these residents will be keeping $50 of their income instead of $34, there will be $16 less per month applied toward their nursing facility care. Thus, funding for nursing facility services will need to be increased accordingly in FY 1999-00:

Client-Oriented Information Network (COIN). DHCPF indicates that it will require one-time modifications/edits to its COIN system in FY 1999-00 to accommodate the PNA increase at a cost of $14,400. It is estimated that 200 hours of computer programming will be needed at a rate of $72/hour (200 hours x $72 = $14,400).

Department of Human Services — $127,840 in FY 1999-00. The cost for FY 2000-01 is estimated at $153,408.

Warrants issued monthly to Medicaid nursing facility residents receiving an SSI payment of $30 for personal needs also receive an Old Age Pension (OAP) or an Aid to the Needy Disabled (AND)/Colorado Supplement payment of $4. For those clients in nursing homes with no income, they receive an OAP or an AND State-Only payment of $34. Thus, for both groups of clients, the monthly warrant would have to be increased $16 to provide a personal needs allowance of $50 per month.

Based on May 1998 data reports of Medicaid paid nursing facility claims, there are an estimated 799 clients monthly who will be affected by the bill. [The client caseload detail which follows is included for the purpose of identifying the funding source for personal needs allowance increases required.] Approximately 739 clients receive SSI benefits monthly, and 60 clients receive either OAP or AND State-Only benefits only. Of the 739 SSI clients, 480 are OAP recipients and 259 are AND/Colorado Supplement recipients. Of the 60 clients ineligible to receive SSI, 33 are OAP recipients and 27 are AND State-Only recipients. In total, the department will require $127,840 in FY 1999-00:

The counties' 20 percent share for assistance payments is estimated at $9,141 in FY 1999-00 and $10,969 in FY 2000-01.

The fiscal note indicates that for FY 1999-00, the Department of Health Care Policy and Financing should receive an appropriation of $1,589,600. Of the total amount, $793,225 is General Fund and $796,375 is federal funds.

The Department of Human Services should receive an appropriation of $127,840. Of the total amount, $82,136 is cash funds from the Old Age Pension Fund, $36,563 is General Fund, and $9,141 is cash funds exempt local funds.