DWRS Rate Increases Approved, DHS Preparing Guidance

By Ken Bence posted 01-26-2024 13:14


ARRM’s members have undoubtedly been frustrated with the apparent delay in obtaining federal approval, and the lack of information regarding the rate increases in the Disability Waiver Rate System (DWRS) that were expected to go into effect on January 1. We know this is true because we heard from many of you! We at ARRM were frustrated too, and have been trying to get reliable information to pass along since before the end of last year.

Many of you were pleased to hear from DHS staff on the monthly Q&A call on January 17 that CMS approval had finally been received. While that was great news, many questions remained as far as what providers and lead agencies were expected to do. We continued to push for detailed information that we would be able to pass along to you. The bulletin that was finally issued on January 25 confirming the approval seemed to raise even more questions than it answered.

Finally, we have received much clearer information that we are very happy to outline here.

The first thing to note is that not all the components of the rate increases required CMS approval. The competitive workforce factor went into effect for service authorization renewals starting on January 1 and are not impacted by the delay in federal approval. The second thing to note, which we were surprised to hear, is that CMS approved the inflationary adjustment components, based on updated CPI-U and SOC data, effective January 31. According to DHS, CMS made the date change a condition of approval, but fortunately the dates of future rate increases will not change.

So what is the path from here? According to information we received directly from DHS, they will identify all authorizations with renewal dates between January 1 and January 30, determine the correct rates that include components that did not require federal approval, and contact each lead agency in early February with a list of authorizations that have to be updated. If billing has already occurred on affected authorizations, take backs will need to be completed prior to the modified rate being authorized if they were paid at rates that were higher than allowed, or providers will be made whole if they were paid less than the allowed rates. Further, future individual renewal dates likely won’t be impacted; the service agreements will maintain the same renewal dates. Within those agreements, there will be 2 service lines for the affected service. One that runs from the renewal date to 1/30, and another that runs from 1/31 to the next renewal date.

The January 25 bulletin contained other information about CMS instructions to DHS to modify the waiver amendment documents, which will have little direct impact on providers. In the original amendment package, several services changed rate-setting types. This revision was intended to identify when rate-setting changed. CMS directed DHS to clearly identify previous language and the changes in this amendment set.

We hope this information gives you the information you need to work with your lead agencies to process the service authorizations according to the DHS plan. Please contact me if you have any questions.

-Ken Bence, Director of Research, Analysis and Policy