Developmental Disabilities Administration DX LECTRONIC ......earliest the RFP process would likely be is April of 2018. That leaves only seven months to choose a vendor, define requirements,

Developmental Disabilities Administration 040 - M2 - DX - ELECTRONIC VISIT VERIFICATION

Agency Submittal: 21-2018 Suppl Agency Req Budget Period: 2017-19

REQUEST

The Department of Social and Health Services (DSHS) Developmental Disabilities Administration (DDA) requests

$1,295,000 total funds ($549,000 GF-State) and 0.5 FTE for initial costs to comply with the federal “21st Century Cures

Act,” which requires states to implement an Electronic Visit Verification (EVV) system by January 1, 2019 or receive a

federal match rate reduction that escalates from 0.25 percent in 2019 up to one percent by 2023. These systems

electronically report and verify information about the delivery of personal care services, such as the date and time,

service type and location.

PROBLEM STATEMENT

Section 12006 of the federal “21st Century Cures Act” requires states to implement EVV system for personal care

provided under Medicaid by January 1, 2019. The act states that failure to implement a system by January 1, 2019 will

lead to a reduction in the state’s federal match rate, escalating from 0.25 percent in 2019 to one percent by 2023, until

a system is in place. Currently Washington requires home care agencies to use electronic timekeeping systems, but

these do not meet the requirements of the “21st Century Cures Act” and there is no visit verification system in place for

individual providers.

An EVV system verifies that personal care services were provided and electronically reports certain information related

to service type, location, the individual receiving the personal care services, the individual providing the services, and

the date and time of the beginning and end of the service shift. These systems can reduce instances of fraudulently

documented home care visits and are a means of verifying when the caregiver is physically present with the client.

System design, development, or installation costs are eligible for a 90 percent Federal Medical Assistance Percentage

(FMAP) and the operation and maintenance of the system is eligible for a 75 percent FMAP. Washington plans to

implement a system that meets the federal requirements for agency providers in approximately July of 2019. However,

the implementation of a system for IPs is estimated to be in July of 2021. The potential match rate penalty, if assessed,

is still less expensive than the cost of building the new system, and allows time for a complete analysis of the business

needs and system requirements.

040 - M2 - DX - Electronic Visit Verification

Estimated Penalties by Fiscal Year for EVV Non-Compliance (GF-State) For Agency and Individual Providers

1 FFY = Federal Fiscal year 2 SFY = State Fiscal year

Year

FMAP Reduction

(FFY1) ALTSA (SFY2) DDA (SFY2) Total (SFY2)

2019 -0.25% $1,088,000 $485,000 $1,573,000

2020 -0.25% $2,318,000 $1,034,000 $3,352,000

2021 -0.50% $3,867,000 $1,725,000 $5,592,000

2022 -0.75% $7,058,000 $3,149,000 $10,207,000

2023 -1.00% $10,849,000 $4,840,000 $15,689,000

2024 -1.00% $13,575,000 $6,057,000 $19,632,000

*Assumptions/methodology:

Cost Growth Rate = 10%

Base FMAP for services = 56%

Use Feb 2017 H52 IP segment ML as base

Use Feb 2017 ALTSA: IP + apportioned training ML as base

Rate of growth 10% FY20 onward

Assume 56% base for Federal match

Waiver is provided for Agency personal care services

PROPOSED SOLUTION The State of Washington must identify and contract with a qualified vendor to provide the software, and possibly

hardware, needed to meet the 21st Century Cures Act requirements for in-home care visit verifications for IPs. Agency

providers already have contracts with vendors for electronic timekeeping and would only need additional funding to

obtain the additional functionality required under the Cures Act. This is the logical first step of a phased-in approach in

order for the state to demonstrate a good faith effort to reach compliance, and thus possibly avoid any match penalty

entirely. Centers for Medicare and Medicaid Services (CMS) rules state that if the state is demonstrating a good faith

effort, the penalty can be waived. While the description of what qualifies as good faith has not been defined, the

assumption is that bringing the agency providers into compliance and having a plan to bring the IPs into compliance will

mean that the penalty is not assessed.

A slower phase-in of the development and implementation of the new system for IPs after further guidance from CMS,

learning lessons from other states, and doing a complete analysis will save costs in the long-term compared to rushing

into development and deployment. Being out of compliance at first may mean paying a penalty in reduced federal

Medicaid match rate for personal care services, depending on how CMS evaluates what a good faith effort is. However,

even if there is a penalty, it is still temporarily less expensive than a full system development and deployment would be.

A faster deployment also increases the risks of change orders needed in the future, which are not assumed as part of the

budgeted cost for the IP visit verifications.

EXPECTED RESULTS

The result is that we’re on a path to develop an EVV to comply with the federal requirements.

STAKEHOLDER IMPACT


The primary stakeholders are the federal Centers for Medicare and Medicaid Services (CMS), home care agencies, SEIU

775NW, which represents IPs, and in-home care clients and their families. (Approximately 70 percent of IPs are family

members of their clients.)

Home care agencies are expected to be neutral, as long as funding is provided. SEIU 775NW has indicated that it will be

a subject of collective bargaining as a change in working conditions.

Agency Contact: Bryan Way, (360) 902-7769 Program Contact: Bill Moss, (360) 902-2311

OTHER CONNECTIONS

Performance Outcomes/Important Connections 1. Does this DP provide essential support to one or more of the Governor’s Results Washington priorities?

Goal 5: Efficient, Effective & Accountable Government - Resource Stewardship - Ensure that funding is used

responsibly.

2. Identify other important connections or impacts below. (Indicate ‘Yes’ or ‘No’. If ‘Yes’ identify the connections or impacts related to the proposal.)

a) Regional/County impacts? No b) Other local government impacts? No c) Tribal government impacts? No d) Other state agency impacts? No e) Responds to specific task force, report, mandate or executive order? No f) Does request contain a compensation change or require changes to a Collective Bargaining Agreement? Yes

g) Facility/workplace needs or impacts? No h) Capital budget impacts? No i) Is change required to existing statutes, rules or contracts? No

j) Is the request related to litigation? No k) Is the request related to Puget Sound recovery? No


l) Other important connections? No 3. Please provide a detailed discussion of connections/impacts identified above.

As a change in working conditions, the new requirement for electronic visit verification will likely be raised as a

subject of in-home collective bargaining.

Alternatives/Consequences/Other 4. What alternatives were explored by the agency, and why was this alternative chosen?

The other logical alternative is to rush to meet the January 2019 implementation deadline. However, there are

several disadvantages with that plan:

CMS is not scheduled to release further guidance on system requirements until December 2017. Assuming that

guidance is released on time and we wait to do Request for Proposals until after we have that clarification, the

earliest the RFP process would likely be is April of 2018. That leaves only seven months to choose a vendor,

define requirements, design, develop, and test the new system.

New systems that are rushed to production tend to have defects leading to corrections that in the end make

implementation slower and more costly.

There is a possibility that if enough states are not able to meet the January 2019 deadline, CMS may delay the

implementation timeline.

There is the potential that Washington’s plan to do a phased implementation, by implementing EVV for Home

Care Agencies first, will be considered a good faith effort, thereby avoiding the imposition of a penalty.

5. How has or can the agency address the issue or need within its current appropriation level?

The estimate cost is significant, so the state cannot proceed to meet the federal requirement without funding from

the legislature.

6. Does this decision package include funding for any IT-related costs (hardware, software, services, cloud-based

services, contracts or IT staff)?

☐ No

☒ Yes (Include an IT Addendum)

Fiscal Detail 040 - M2 - DX - Electronic Visit Verification

Operating Expenditures FY 2018 FY 2019 FY 2020 FY 2021

001-1 General Fund-State 0 549,000 792,000 1,910,000

001-C General Fund-Medicaid 0 746,000 1,603,000 4,172,000

Total Cost 0 1,295,000 2,395,000 6,082,000

Staffing FY 2018 FY 2019 FY 2020 FY 2021

FTEs 0.0 1.0 3.4 10.0

Performance Measure Detail

Incremental Changes

Activity: FY 2018 FY 2019 FY 2020 FY 2021

Program: 040

D087 Residential Program

No measures submitted for package

Object Detail FY 2018 FY 2019 FY 2020 FY 2021

A Salaries and Wages 0 84,000 260,000 696,000

B Employee Benefits 0 30,000 96,000 268,000

C Professional Service Contracts 0 278,000 1,112,000 4,118,000

E Goods and Other Services 0 6,000 20,000 60,000

J Capital Outlays 0 6,000 14,000 40,000

N Grants, Benefits, and Client Services 0 890,000 890,000 890,000

TZ Intra-agency Reimbursements 0 1,000 3,000 10,000

Total Objects 0 1,295,000 2,395,000 6,082,000

DSHS Source Detail

Overall Funding

Operating Expenditures FY 2018 FY 2019 FY 2020 FY 2021

Fund 001-1, General Fund-State

Sources Title

0011 General Fund State 0 549,000 792,000 1,910,000

Total for Fund 001-1 0 549,000 792,000 1,910,000

Fund 001-C, General Fund-Medicaid

Sources Title

19UL Title XIX Admin (50%) 0 746,000 1,603,000 4,172,000

Total for Fund 001-C 0 746,000 1,603,000 4,172,000

Total Overall Funding 0 1,295,000 2,395,000 6,082,000

2018 Supplemental Budget - IT Addendum

040 – M2 – DX – Electronic Visit Verification

Part 1: Itemized IT Costs Please itemize any IT-related costs, including hardware, software, services (including cloud-based services), contracts (including professional services, quality assurance, and independent verification and validation), or IT staff. Be as specific as you can. (See chapter 12.1 of the operating budget instructions for guidance on what counts as “IT-related costs”)

Information Technology Items in this DP

(insert rows as required) FY 2018 FY 2019 FY 2020 FY 2021

Client Rates 1 $0 $890,000 $890,000 $890,000

System Costs $0 $278,000 $1,112,000 $4,118,000

ALTSA/DDA staffing $0 $127,000 $393,000 $1,074,000

Total Cost $0 $1,295,000 $2,395,000 $6,082,000

1 AP solution only, assuming $0.50 per hour for increased functionality to meet Cures Act standards.

Part 2: Identifying IT Projects If the investment proposed in the decision package is the development or acquisition of an IT project/system, or is an enhancement to or modification of an existing IT project/system, it will also be reviewed and ranked by the OCIO as required by RCW 43.88.092. The answers to the three questions below will help OFM and the OCIO determine whether this decision package is, or enhances/modifies, an IT project:

1. Does this decision package fund the development or acquisition of a ☒Yes ☐ No new or enhanced software or hardware system or service?

2. Does this decision package fund the acquisition or enhancements ☐Yes ☒ No of any agency data centers? (See OCIO Policy 184 for definition.)

3. Does this decision package fund the continuation of a project that ☐Yes ☒ No is, or will be, under OCIO oversight? (See OCIO Policy 121.)

If you answered “yes” to any of these questions, you must complete a concept review with the OCIO before submitting your budget request. Refer to chapter 12.2 of the operating budget instructions for more information.

https://ocio.wa.gov/policies/policy-184-data-center-investments

https://ocio.wa.gov/policies/121-it-investments-approval-and-oversight

2018 Supplemental Budget 040 – M2 – DX – Electronic Visit Verification

Revised 5-23-2014

Office of the Chief Information Officer, Washington State

Procedure No. 121: IT Investment Approval and Oversight

Appendix B: Concept Briefing Document Template

(See OCIO Policy 121- IT Investment Approval and Oversight) OCIO Log Number:

Email this Document To:

[email protected]

0 Tentative Project Title: Electronic Visit Verification Will this concept lead to a decision package submittal to OFM for the upcoming budget cycle? Yes Preliminary Oversight Assessment: Level

1 Agency Name: DSHS Contact Name: Sergio Palma If known:

Project Manager Name/Title: Dennis Elonka

Executive Sponsor Name/Title: Evelyn Perez

Business Owner Name/Title: Debbie Roberts

Phone No. and E-mail: 360-725-2440 Phone No.: 360-725-3269

Phone No.: 360-407-1564

Phone No.: 360-407-1556

2 Describe the business problem the agency is trying to solve with this project: (100 word max): Section 12006 of the Federal “21st Century Cures Act’’ requires all states to implement an electronic visit verification system for personal care providers by January 1, 2019 or face increasing reductions in Medicaid matching rate (from .25% to 1%) for subsequent calendar year quarters as a penalty. Washington plans to implement a system that meets the federal requirements in approximately July of 2019.

3 Please describe any additional relevant factors that further motivate this project, such as legislation or a financial analysis. This is strictly driven by the federal requirement.

4 Describe likely funding scenarios for this project: This project will only proceed if funding is appropriated by the 2018 Legislature.

5 Estimated Range of Project Cost: More than $1,000,000 and less than $2,000,000 Estimated 5-year Maintenance Cost: More than $15,000,000 and less than $20,000,000 Estimated Range of Total Lifecycle Cost: More than $? and less than $?

mailto:[email protected]

2018 Supplemental Budget 040 – M2 – DX – Electronic Visit Verification

Revised 5-23-2014

6 If there is a hoped-for Project Start Date, please note it here: July 1, 2018 Estimated Project Duration in Months: 36

7 Describe performance outcomes and how they will be measured. Electronic Visit Verification records will be matched against claimed authorizations to confirm that all hours authorized for payment were in fact worked at the client’s location.

8 What discovery or market analysis will the agency do to inform the technical solution? (Survey other agencies/states, RFI, RFQ, Feasibility Study, etc.): Already surveyed other states, and will be conducting a formal feasibility study, which is one of the reasons for the slower phase-in of the IP solution.

9 Will this project deliver customer-facing value? If so, please describe that value and at approximately what point in the Project Duration that value will be delivered. In your response, please describe who the primary customer is: Yes, clients will have ready access to verify the hours reported as worked by their caregiver.

10 Describe how this concept aligns with the State IT Strategic Objectives: Addressing a problem with a SAAS cloud-based solution.

11 Agencies are expected to utilize CTS and DES applications and services when appropriate and/or mandated by legislation. What is the status of your consult with CTS? With DES? Have already discussed with OCIO, specifically Sue Langen. Discussed nature of the problem and possible alternatives. Determined there are not existing solutions already in place in the state. Addressing a problem with a SAAS cloud-based solution.

12 What are the biggest concerns about the project at this point in time? Lack of clarity from CMS regarding system requirements, implementation timelines and potential penalties for non-compliance.

OCIO NOTES Meeting Date: / / Comments:

2018 Supplemental Budget


Parent Criteria

Criterion Name AGY Rate Agency Notes

Business Process

Improvement

Rating Value Scale Definition

Major

Transformation

100% The project is transformative and sets up the agency for

continuous process improvement.

Significant

Transformation

50% The project is transformative by improving or leaning out

significant business processes.

Moderate

Transformation

25% The project is transformative and improves some business

processes.

No

Transformation

0% The project is not a transformative initiative. X


Risk Mitigation /

Organizational

Change

Management


Strong Risk

Mitigation

100% The project has anticipated and budgeted for risk mitigation

or has no associated risks.

Moderate Risk

Mitigation

50% The project has budgeted for a minimal amount of risk

mitigation.

Minimal Risk

Mitigation

25% The project speaks to risk mitigation but has not identified

resources to address the issue.

X

No Risk Mitigation 0% The project has not considered or planned for associated

risks.


Measurable

Business

Outcomes Aligned

to Agency

Strategy


Significant,

Measurable

Outcome Metrics

100% The project proposal identifies significant performance

measures that have a direct impact on the business of the

agency. Measures are base-lined and have target goals.

Significant

Transformation

50% The project has identified at least one outcome measure but

has not baseline data or target goals.

Outcomes

Identified / Not

Measurable

25% The project speaks to business improvements but has not

identified any measurable outcomes.

No Business

Outcomes

Identified

0% The proposal has not identified any performance outcomes. X


Impact of Not

Doing


Significant Impact 100% Failure to meet statutory or legal mandates. Include

Imminent failure of a mission critical system.

X Section 12006 of the Federal “21st Century Cures Act’’

requires all states to implement an electronic visit verification

system for personal care providers (PC) by January 1, 2019

Moderate Impact 50% There is a risk of failure for aging systems and high cost for

recovery and support.

Minimal Impact 25% Loss of opportunity for improved service delivery or efficiency.

Criterion Definition

Primary goal of the proposal is to transform an agency business process --

This criterion will be used to assess the transformative nature of the

project (INTENT: to incentivize agencies to take transformative projects

that may include risk.)


Primary goal is to assess the agencies anticipation of the risk of an

initiative and planned mitigation of those risks. This criterion will be used

to determine if the initiative provides adequate resources to mitigate risks

commensurate with the risks associated with a technology initiative. Risk

planning may include budgeting for independent Quality Assurance,

organizational change management, training, staffing, etc. (INTENT:

Drive business value by encouraging risk taking that is well managed.)


The goal of this criteria is to assess the extent to which the IT proposal

has established measurable business outcomes aligned to agency

strategies. (The intent is to drive agencies to establish business outcomes

and measures those outcomes).


Primary goal is to assess the impact of not funding an IT initiative as it

may relate to service failure, mandates, legal requirements, or loss of

opportunity.

Business Driven IT Management

These criteria are used to assess how IT proposals support business changes made to improve services or access to information for agency users,

customers or citizens and are staged for success.



Parent Criteria


Interoperability


Plays great with

others

100% Interoperability is built into the core IT systems used by the

project. The system publishes a clear Application

Programming Interface (API) that allows other state systems

to exchange data with it simply and reliably without

restrictions, additional purchases or new custom coding.

Optional Vendor

Add-on

50% The project will use a system that can inter-operate with other

systems through one or more proprietary connectors,

services, etc., usually created and supported by the system

vendor for an additional fee.

Custom coding

required

24% New connections can or have been made to external systems

via custom development.

Isolated 0% Isolated. The systems in this project will not really

communicate with other systems in state government, except

by virtue of sharing another database.

X


Leverages

Existing Systems

or Creates

Reusable

Components


Significant Reuse 100% Completely leverages and existing system already in use

within the state or has the potential to be reused by other

agencies or programs.

Moderate Reuse 50% Leverages some system components already in use within

the state but has the potential for additional reuse by other

agencies or programs.

Minimal Reuse 25% Leverages some existing components but does not have the

potential for additional reuse by other agencies or programs.

No Reuse 0% Does not leverage any system or components already in use

within the state and does not have the potential to be reused

by other agencies or programs.

X Agency in-home care providers already use electronic

timekeeping, but their current systems do not meet the new

federal requirements. With additional funding, they will be

able to increase the functionality of their existing systems -

but those are private vendors, not a state system.

Parent Criteria


Mobility


Primarily Mobile 100% The project primary objective is to create anytime, anywhere

mobile access to a state system or service for a significant

number of external customers.

Moderate Mobile

Improvement

50% The project will improve the mobility for state workers or

provide access to a small number of external customers.

Incremental

Mobile

Improvement

25% The project may provide an incrementally improved mobile

experience for external customers or workers.

No Mobile

Component

0% The project provides no improvement to a mobile experience

for external customers.

X


Application/system has the capability to share information with other

systems without additional custom development (either in house or by the

vendor/s) or additional investment in order to achieve interoperability.

INTENT: Drive agencies to acquire and/or develop systems that are

interoperable across the state enterprise.)


Reuse: leverages an existing system already in use within the state or has

the potential to be reused by other agencies or programs.


New mobile services for citizens or state workforce -- This criterion will be

used to assess the contribution of the initiative to support mobile

government services for citizens and a mobile workforce. (INTENT: to

drive agencies to look for ways to deliver results and services that are

accessible to citizen from mobile devices. We value mobility for

employees as well but value mobility for citizens more).

Architectural Standards

The goal of these criteria are to assess the IT proposal's implementation of interoperability standards and reuse of existing systems or components.

Technology Strategy Alignment

The goal of these criteria are to assess the alignment of the IT proposal to the technology strategies of the state as articulated by the Office of the

Chief Information Officer.




Open Data


Open, Useful +

Multi-Agency

100% Two or more agencies are collaborating to publish open data

in this project that they know will be used and useful.

Open and Useful 50% The agency will produce more open data as part of this

project and knows that it will be useful to the public - perhaps

through a stakeholder feedback process or analysis of web

analytics on current offerings.

New Open Data 25% The project will publish some new open data, but the agency

or project team are working within a single agency and are

not in a position to assess how useful it may be.

X

No Open Data 0% The project will not publish open data. It may be that the

project's data is confidential, or that the agency prefers to

publish PDF's, printed reports or eyes-only briefings.


Modernization


Modern and Cloud 100% The project is designed to significantly modernize a core part

of state IT infrastructure using a cloud-based approach. We

value a cloud first strategy that means SaaS, hosted COTS,

PaaS, and IaaS.

Modern and

Hybrid

50% The project uses a significantly newer technical solution that

is a combination of cloud and non-cloud.

Newer with no

Cloud

25% The project uses a significantly newer technical solution that

is not cloud based.

X

Not More Modern 0% The project replaces legacy systems or technologies with

technology that is not significantly more modern.


Early Value

Delivery


Value Within 6

Months

100% The project is designed to produce customer-usable value

every six months.

Value Within 12

Months


every twelve months.

Value Within 18

Months


every 18 months.

Value Over 18

Months

0% The project does not take an agile approach and/or does not

deliver customer-facing value every 18 months.

X

Cloud, SaaS, PaaS, COTS before custom development -- This criterion

will be used to assess if the initiative will result in replacing systems with

contemporary solutions. (INTENT: to drive agencies to look more intently

at leveraging modern solutions).


Adds value in short increments -- This criterion will be used to determine if

the initiative provides “customer-facing value” in small increments, quickly

to drive our agile strategy. (INTENT: Drive agencies to producing value

more quickly and incrementally).


New data sets exposed -- This criterion will be used to assess if the

initiative Will the project increase the citizen's access to state data with no

strings attached and in a format that's easy to use? The legislature

has found that government data are a vital resource to both government

operations and to the public that government serves. RCW

43.105.351 Publication of open data reduces time spent on records

requests, helps our companies adapt to a dynamic economy, and helps

civic groups, researchers and small agencies get their work done.




Parent Criteria


Security


Agency-wide

Impact

100% The project’s primary purpose is to introduce new capabilities

to improve security across in an agency.

Adds New

Security

50% The project addresses a business problem AND includes

significant security improvements.

Improves Existing 25% The project incrementally improves the existing security for an

agency.

No Impact 0% The project will have no impact on an agency’s security

posture and/or infrastructure.

X


Privacy Principles


Agency-wide

Impact

100% The project’s primary purpose is to introduce new capabilities

to improve data privacy across in an agency.

Adds New Privacy

Capabilities

50% The project addresses a business problem AND includes

significant data privacy improvements.

Improves Existing 25% The project incrementally improves the existing privacy

posture and/or capabilities.

No Impact 0% The project will have no impact on an agency’s data privacy

posture and/or infrastructure.

X


Improve agency security -- This criterion will be used to assess the

improvements to the overall security posture for an agency. (INTENT: to

award points to projects when the purpose of the initiative is to improve

security across an agency.


Privacy principles applied to investment -- This criterion will be used to

assess if the initiative will be implemented in whole or in part with

consideration of established privacy principles (e.g., data minimization,

data retention, data quality, controlled data access, etc.).

Security and Privacy

The goal of these criteria are to assess the IT proposal's impact on the security of agency systems and data AND the impact on the privacy of citizen

data.

Documents

Developmental Disabilities Administration DX LECTRONIC ......earliest the RFP process would likely be is April of 2018. That leaves only seven months to choose a vendor, define requirements,