What’s happening: July 1 marks the usual effective date of legislation and the budget passed during the year’s General Assembly session.

• While budget negotiations have broken down again, VHCA-VCAL expects DMAS to move forward and publish state fiscal year (SFY) 2024 rates effective for dates of service beginning July 1, 2023 under the existing budget for SFY 2024.

The new Medicaid rates will reflect the following:

• application of the 6.33 percent inflation increase the relevant rate components;
• updated Fair Rental Value (per the normal process); and
• the new Value-Based Purchasing (VBP) Program rate add-on, which DMAS confirmed would be $6.13. This amount will be added to the inflated Indirect Care component. (Remember that for SFY24, the current $10.49 add-on will be removed, the remainder will be inflated by 6.33 percent, and then the $6.13 will be added. Also, keep in mind, last year the budget increased the VBP Program’s total funding from $118 million to $144 million for SFY24, but the add-on being reduced from 50 percent of the total in the current year to 25 percent of the higher total in SFY24 with the metric-based portion moving to 75 percent).

Special note: DMAS posted the SFY24 rates, and they included an error on the Indirect Care rate. This was due to a formula related to the add-on that did not properly update.

• We expect that DMAS will recalculate and repost the corrected Indirect Care rate. The Direct Care component appears to be properly calculated; the updated capital rates are also available.

VHCA-VCAL’s priorities during the 2023 General Assembly included:

• advocating for budget amendments to fund Medicaid rate reforms and tying VBP Program funding to inflation so the program does not lose value over time;
• supporting legislation to establish a numerical staffing standard with appropriate guardrails for nursing facility direct care; and
• backing legislation to fix a discrete issue with the Long Term Services and Supports (LTSS) Screenings.

Read our 2023 Bill Wrap Up for all the details.

• The wrap also includes details on other the nursing facility and assisted living related legislation.
• Note that a May 11 DSS memo advises ALFs on legislation passed in the 2023 General Assembly session affecting them. The memo reviews three bills covering nurse practitioner licensing, minimum liability insurance requirements for ALFs, and provisional licensing of ALFs.