Generally, Medicaid doesn’t cover room and board costs for community residential facilities under states’ home and community-based services waiver programs, according to the OIG. However, after reviewing payment rates for residential habilitation services provided under New York’s developmental disabilities waiver program, the agency found the New York Office for People With Developmental Disabilities factored certain unallowable room and board costs — including repairs, maintenance, utilities and property-related costs — into the indirect costs used to determine residential habilitation services payment rates.
The OIG has recommended that the New York Department of Health refund the wrongful reimbursements to the federal government and take steps to ensure the OPWDD excludes all unallowable room and board costs from the indirect costs used in payment rate calculations.
The state health department disagreed with the OIG’s first recommendation and didn’t indicate whether it concurred with the second recommendation, according to the report. The Department of Health stated “it was reasonable for DOH to conclude that its rate-setting methodology in place since 1998 complied with the Federal requirement to exclude room-and-board costs from waiver services.” Still, the state has revised its rate-setting methodology to exclude the “disputed costs” as of Oct. 1, 2010, according to the report. The OIG maintains that its recommendations are valid and that the state should refund the wrongful reimbursement.
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