Update to 2022 DWRS Rate Increases

By Ken Bence posted 08-02-2021 16:31

On June 21, I posted to this blog to describe what we knew about the 2022 DWRS rate increases that were passed by the Legislature, as well as the 80% encumbrance requirement. DHS hasn't officially released any new information since then, but we understand they are getting close to sending out guidance for providers. I have gotten a number of good questions, so will share more information here.

Q: Do the 2022 rate increases replace the competitive workforce factor (CWF) that is currently in force?
A: No. The CWF and the 2022 rate increases are independent of each other, but they do interact. The CWF remains in effect until the Legislature changes it. The 2019 statute that created the CWF also obligated DHS to study wages every 2 years and make recommendations to the Legislature to increase, decrease or leave the CWF alone.  DHS submitted the required report to the Legislature in January, 2021 and they recommended an increase of the maximum amount of 2%. The Legislature took no action in 2021 (at least so far), so the 4.7% factor will be applied to the new wage rates.

Q: How will the 2022 rate increases affect rate exceptions?
A: Rate exceptions won't be directly impacted by the increases. Rate exceptions are based on extraordinary needs of the individuals supported, and must be calculated from and apply to the rate frameworks. For exception amounts based on inadequate staffing reimbursement, there could be a relationship to the new wage amounts in the frameworks going forward.

Q: Will nursing rates increase in 2022?
A: Yes. The component values for both RN and LPN will increase based on the Bureau of Labor Statistics occupational classification data from December, 2019. However, providers should note that because RN rates had been increased in the past, my calculations show a very slight 2022 increase, from $31.41 to $31.47 per hour.

In my last rates update, I included links to a few rate estimation tools that we had created. I am pleased to report that we have made slight updates to those tools to hopefully improve their accuracy, and added a couple more services. And, we are making available for the first time here a set of rate comparison tools for the same set of service frameworks. The comparison tools allow a provider to input the same information as they would in a service framework, and generate side-by-side rates based on both the current frameworks and the 2022 estimated frameworks for comparison. The entire set of tools is linked below.

Rate Estimation Tools

Rate Comparison Tools NEW

As always, contact me if you have any questions.

-Ken Bence, Director of Research, Analysis and Policy