Newsletter August 2023
Finance
Leslie Thomas, MBA, CPA
Chief Financial Officer
MSHN’s Finance Team is actively engaged in several activities related to Fiscal Year (FY) 2024.
MSHN received draft capitation rates from Michigan Department of Health and Human Services (MDHHS) in July. Capitation information allows Finance to project the Region’s anticipated revenue by Community Mental Health Service Participant and Substance Use Disorder. In conjunction with calculating revenue, expense information is also collected and those two components are used to develop a complete FY 2024 budget. Unfortunately, because the rates are in draft format, they are subject to change. In addition, the draft rates do not include key items such as geographic factors and projected enrollment updates. These two items are key when making accurate projections:
- Geographic Factors – MDHHS’ actuarial contractor assigns a number to each Prepaid Inpatient Health Plan (PIHP) based on expenses, urban or rural status, and other financial information. The numbers usually range from .97 – 1.2 for example. PIHPs with a number less than 1 will receive a reduction in base capitation and vice versa for those with numbers greater than 1.
- Enrollment – MDHHS acknowledges there will be a reduction in the number of eligibles for Medicaid and Healthy Michigan. As you know, the Region’s revenue is derived from eligibles not individuals served. Having projections in this area is key to calculating accurate revenue.
In addition to the Substance Use Disorder (SUD) contracts discussed in June’s Newsletter, MSHN also works with the Community Mental Health Service Providers (CMHSPs) on the following regional contracts:
- Medicaid Subcontracting Agreement – Contract between MSHN and the CMHSPs for all disbursed payments. In addition to standard boiler plate language, the contract includes a funding exhibit (anticipated revenues) and CMHSP reporting requirements.
- Applied Behavioral Analysis (ABA) – CMHSPs use this contract template for their work with Autism Service Providers.
- Inpatient – CMHSPs use this contract template with hospitals for individuals receiving Mental Health Inpatient care.
- Financial Management Services (FMS) – The purpose of FMS Providers is to manage an individual budget and make payments as authorized by the person served for individuals assisting in their care. An FMS provider may also render a variety of supportive services that assist the person in self-directing their care.
For further information or questions, please contact Leslie @ Leslie.Thomas@midstatehealthnetwork.org.