The Health and Human Services Omnibus Bill was finally released on Friday evening, and it was 649 pages! We directed our attention first to the base wage and component values section of the HCBS Waivers chapter, and we can confirm that the final bill, which is expected to be signed by Governor Walz as soon as today, DOES contain a competitive workforce factor (CWF) of 4.7% (an average 4% increase in service rates) and this factor will be a component value embedded in the rate management system.
The anticipated funding increase totals $34.2 million for the 2020-21 biennium and $30.2 million for the 2022-23 biennium for the services listed below:
- Corporate foster care services, corporate supportive living services daily, community residential services, integrated community support services
- Family foster care
- Day training and habilitation, day support services, prevocational services
- Adult day services
- Unit-based services with programming
- Unit-based services without programming, including respite
Encumbrance
Providers are directed to identify the additional revenues they receive as a result of the CWF and provide a distribution plan that must be available and accessible to direct care staff for at least 1 year.
Automatic Adjustments
Also as anticipated, the base wage index will be updated every 2 years, rather than every 5, beginning July 1, 2022. And the inflationary adjustment is also changed from every 5 years to every 2 years, beginning July 1, 2022. However, both of these adjustments will be based on data available 30 months and one day prior to the scheduled updates, rather than on the most recently available data. We believe this change was agreed to in the joint committee as a way to keep the costs down in the out years and meet the overall budget target.
Data Study
Another provision of the bill directs the Commissioner of Human Services to provide an analysis of the competitive workforce factor to the legislature every 2 years, beginning February 1, 2021. This analysis must be based on the most recently available wage data and – this is new but similar to the existing DWRS cost reporting requirement - Minnesota workforce data that will be required to be provided annually by HCBS providers beginning in 2020 (providers who receive less than 25% of their revenue from HCBS waivers will be able to decline to provide the workforce data). While the final bill does not include an automatic increase to the CWF in 2024 & 2026 as the House bill did, it does permit an increase (or a decrease) of no more than 2% based on the DHS analysis.
Federal Approval
The CWF is subject to federal approval before it can be implemented. It is difficult to anticipate exactly when this will occur, and ARRM staff will be engaging with DHS to discuss timing. However, it can be stated that it is highly unlikely to be approved by July 1, 2019 when most legislation passed this session will take effect. It is more likely to be closer to a January 1, 2020 implementation date, but stay tuned.