DDRS Update- Reimbursement Rate Increase to Improve Direct Care Staff Wages

The Division of Disability and Rehabilitative Services (DDRS) has sent the following update on Implementation Information of Indiana Code 12-15-1.3-18 – Reimbursement rate increase to improve direct care staff wages.

Individuals with intellectual or developmental disabilities (I/DD) and their families rely on direct care staff every day to provide necessary supports and services through the Family Supports Waiver (FSW) and the Community Integration and Habilitation (CIH) Waiver administered through the Division of Disability and Rehabilitative Services (DDRS), Bureau of Developmental Disabilities Services (BDDS). As with many states, Indiana recognizes the need for a high-quality workforce to provide critical care and supports in order for individuals to receive home and community based services in settings that are integrated and that support full access to the greater community. While the workforce shortage for direct care staff is complex, one targeted area to assist in addressing staff turnover is wages. 

Due to the joint effort of The Arc of Indiana and the Indiana Association of Rehabilitation Facilities (INARF), the Indiana General Assembly passed House Enrolled Act 1001 which mandated a 5 percent rate increase for specific services1 provided under the FSW and CIH waivers with the intent to use the rate increase to increase wages for direct care staff. The legislation requires an authorized provider to use at least 75 percent of the amount of the increase to the reimbursement rate to increase the wages paid to direct care staff. If a provider does not use at least 75 percent of the increase to the reimbursement rate to increase direct care staff wages, the Office of the Secretary of Indiana’s Family and Social Services Administration (FSSA) agency shall recoup the difference between the rate reimbursement and the amount that provider actually used to pay increased wages to direct care staff. A provider may retain the remaining 25 percent to be used for employer-related costs of providing direct care services. This legislation has been codified under Indiana Code 12-15-1.3-18 (see Attachment A).

In preparation for implementation, BDDS has completed the FSW and CIH waiver amendments, released the amendments for public comment, and plans to submit the amendments to the Centers for Medicare and Medicaid Services (CMS) by September 1, 2017. The effective date will be prospective and contingent upon CMS approval. FSSA/BDDS has requested an expedited review by CMS with the goal of achieving an October 1, 2017, effective date. Any delays in implementation will be communicated to stakeholders. While Indiana Code 12-15-1.3-18 requires a rate increase for the outlined services, it also stipulates required actions for all authorized providers related to notifications and use of the rate increase. Specifically, IC 12-15-1.3-18(f) requires all providers to submit written and electronic notification of its plan to increase wages to: 1) direct care staff employed by the provider; and 2) the Office of the Secretary of FSSA within 30 days after the office implements an increase in the reimbursement rates. In order for the FSSA to monitor compliance of IC 12-15-1.3-18, the statute provides details regarding the information providers must maintain to document their compliance. FSSA reserves the right to audit providers to ascertain whether they have utilized the 5 percent rate increase in the manner required by the legislation.

To facilitate the successful implementation of IC 12-15-1.3-18, FSSA/BDDS coordinated with FSSA Audit, The Arc of Indiana and INARF to develop the attached guidance related to the providers’ plan development and submission requirements to assist providers in implementing the rate increase (see Attachment B). An Excel spreadsheet with guidance regarding direct care staff wage calculations may be found here.

View the full announcement and attachments here.