State of california

Payment Provisions.

1. 
   Budget Contingency Clauses.
   

1. 
   Federal Budget.
   

If federal funding for federal financial participation reimbursement in relation to this contract is eliminated or substantially reduced by Congress, the Department and the Contractor each shall have the option to either cancel this contract or propose a contract amendment to address changes to the program required as a result of the elimination or reduction of federal funding.

2. 
   State Budget.
   

Through June 30, 2012, this program is funded by the State to the extent that the Legislature appropriates funds through the budget process.

3. 
   Delayed Federal or State Budget.
   

Contractor and Department agree to consult on interim measures for program operation that may be required to maintain adequate services to beneficiaries in the event that there is likely to be a delay in the availability of federal funding or enactment of the State Budget.

2. 
   Payment to the Contractor.
   

1. 
   The Contractor shall receive payment of its Managed Care Allocation for the period April 1, 2012 through June 30, 2012, after funds are appropriated by the Legislature to the Department in item 4440-103-0001 of the Budget Act. Payment of the Managed Care Allocation shall be in accordance with Section 5778(c) of the Welfare and Institutions Code and based on a formula determined by the Department in consultation with the California Mental Health Directors Association.
   

2. 
   The Contractor shall also receive payment of its Managed Care Allocation from Mental Health Service Funds for the period April 1, 2012 through June 30, 2012, after funds are appropriated by the Legislature to the Department in item 4440-103-3085 of the Budget Act. Payment of the Managed Care Allocation from Mental Health Service Funds shall be in accordance with Section 5892, subdivision (j)(1) of the Welfare and Institutions Code. These payments are subject to the limit set forth in Section 5892, subdivision (j)(6) of the Welfare and Institutions Code.
   

3. 
   The Contractor shall receive payment of its Managed Care Allocation from the Local Revenue Fund 2011 for the period July 1, 2012 through December 31, 2012.
   

4. 
   For the period April 1, 2012 through June 30, 2012, the state share for reimbursement of claims for EPSDT services, and any other claims for services that may include a State reimbursement funding share, shall become available after passage of the State Budget Act and, irrespective of the effective date of this contract, shall be used to fund all services provided since the beginning of the state fiscal year. The Contractor shall receive payment of the State portion for EPSDT services from an allocation in accordance with Section 5892, subdivision (j)(4), of the Welfare and Institutions Code. These payments are subject to the limit set forth in Section 5892, subdivision (j)(6), of the Welfare and Institutions Code.
   

5. 
   For the period July 1, 2012 through June 30, 2012, the Contractor shall receive payments for the State share for reimbursement of claims for EPSDT services, and any other claims for services that may include a State reimbursement funding share, from the Local Revenue Fund 2011.
   

6. 
   Pursuant to Section 5713 of the Welfare and Institutions Code, the Department may advance payments from the amounts available for either the Managed Care Allocation or the state share for claims for services provided under this contract. Any advance payment shall be made in the form and manner determined by the Director. Advance payments are subject to the provisions of the Budget Act.
   

3. 
   Federal Financial Participation.
   

Nothing in this contract shall limit the Contractor’s ability to submit claims for appropriate federal financial participation reimbursement based on actual, total fund expenditures for any covered services or utilization review and administrative costs. In accordance with Section 5718(c) of the Welfare and Institutions Code, the county shall ensure compliance with all requirements necessary for Medi-Cal reimbursement for these services. Claims for federal financial participation reimbursement shall be submitted by the Contractor and shall be sent by the Department to the Department of Health Care Services for adjudication throughout the fiscal year, regardless of when the State Budget is enacted.

4. 
   Cost Reporting.
   

The Contractor shall submit a fiscal year-end cost report no later than December 31 following the close of each fiscal year unless that date is extended by the Department, in accordance with Welfare and Institutions Code Sections 5664(a) and (b), and 5718(c), and guidelines established by the Department. Data submitted shall be full and complete and the cost report shall be certified by the Contractor’s Mental Health Director and one of the following: (1) the Contractor’s Chief Financial Officer (or equivalent), (2) an individual who has delegated authority to sign for, and reports directly to the Contractor’s Chief Financial Officer, or (3)the county’s auditor controller, or equivalent. The cost report shall include both Contractor's costs and the cost of its subcontractors, if any. The cost report shall be completed in accordance with instructions contained in the Department's Cost and Financial Reporting System Instruction Manual for the applicable year; however, to the extent that the Contractor disagrees with such instructions, it may raise that disagreement in writing with the Department at the time the cost report is filed, and shall have the right to appeal such disagreement pursuant to procedures developed under Welfare and Institutions Code Section 14171. 

5. 
   Audits and Recoupment.
   

1. 
   When the Department receives notice from CMS of a deferral or offset by CMS or DHCS of payment of FFP in relation to claims by the Contractor, the Department shall notify the Contractor within 30 days of receiving the deferral or offset notice and include the reason for the deferral or offset, if known.
   

2. 
   Pursuant to Section 14170 of the Welfare and Institutions Code, cost reports submitted to the Department are subject to audit in the manner and form prescribed by the Department. The year-end cost report shall include both Contractor’s costs and the costs of its subcontractors, if any. Contractor and its subcontractors shall be subject to audits and/or reviews, including client record reviews, by the Department.  In accordance with Section 14170 of the Welfare and Institutions Code, any audit of Contractor’s cost report shall occur within three years of the date of receipt by the Department of the final cost report with signed certification by the Contractor's Mental Health Director and one of the following: (1) the Contractor’s Chief Financial Officer (or equivalent), (2) an individual who has delegated authority to sign for, and reports directly to the Contractor’s Chief Financial Officer, or (3) the county auditor controller, or equivalent.  Both signatures are required before the cost report shall be considered final.  For purposes of this section, the cost report shall be considered audited once the Department has informed the Contractor of its intent to disallow costs on the cost report.
   

3. 
   If the adjustments result in the Department owing an amount to the Contractor, payment to the Contractor shall be made in accordance with applicable federal rules for federal funds (invoicing for federal funds). The Department shall invoice DHCS for the federal funds owed to the Contractor within 45 days after the adjustments are final. Consistent with federal law contained in Title 42, U.S.C. Sections 1396b(d)(2)(C) federal funds shall be recouped within 1 year after the issuance of a final audit report containing a final determination that there has been an overpayment of federal funds. In the case of federal fund recoupment, the Department shall send a notice and invoice to the Contractor, giving options for repayment after the adjustments are final. If the Contractor does not respond within the time period specified in the notice, the Department shall offset the recoupment amount from money owed to the Contractor in accordance with the Department’s procedures.
   

4. 
   Any amount of state funds found to be owed to Contractor shall be paid by the Department from currently available State appropriations within 45 days or, if a current appropriation is not available, within 45 days of a new State appropriation becoming available. If the adjustments result in the Contractor owing an amount to the Department, the Department shall invoice Contractor for repayment of state funds and the Contractor shall have the option of remitting payment to the Department or agreeing to an offset from amounts owed for current claims submitted. In the event that any amount of State funds must be recouped, pursuant to WIC 5717, repayment is to be collected within 30 days.
   

6. 
   Claims Adjudication Process.
   

1. 
   In accordance with Section 5718(c) of the Welfare and Institutions Code, claims for federal funds in reimbursement for services shall comply with eligibility and service requirements under applicable federal and state law.
   

2. 
   The Contractor shall certify each claim submitted to the Department in accordance with Title 9, CCR, Section 1840.112, at the time the claims are submitted to the Department. The Contractor's Chief Financial Officer or his or her equivalent, or an individual with authority delegated by the county auditor-controller, shall sign the certification, declaring, under penalty of perjury, that the Contractor has incurred an expenditure to cover the services included in the claims to satisfy the requirements for federal financial participation. The Contractor's Mental Health Director or an individual with authority delegated by the Mental Health Director shall sign the certification, declaring, under penalty of perjury that, to the best of his or her knowledge and belief, the claim is in all respects true, correct, and in accordance with the law and meets the requirements of Title 9, CCR, Section 1840.112(b). The Contractor shall have mechanisms that support the Mental Health Director's certification, including the certification that the services for which claims were submitted were actually provided to the beneficiary. If the Department requires additional information from the Contractor that will be used to establish Department payments to the Contractor, the Contractor shall certify that the additional information provided is in accordance with Title 42, CFR, Section 438.604.
   

3. 
   Claims not meeting federal and/or state requirements shall be returned to Contractor as not approved for payment, along with a reason for denial. Claims meeting all HIPAA transaction requirements and certified by the Contractor in accordance with Title 9, CCR, Section 1840.112, shall be processed and submitted by the Department to DHCS within 30 days for adjudication.
   

4. 
   Good cause justification for late claim submission is governed by regulation (Title 9, CCR, Section 1840.110) and is subject to approval by the Department of Health Care Services.
   

5. 
   In the event that the Department or the Contractor determines that significant changes must be made relating to either the Department’s or the Contractor’s claims submission and adjudication systems due to federal or state law changes or business requirements, both the Department and the Contractor agree to provide notice to the other party as soon as practicable prior to implementation. This notice shall include information and comments regarding the anticipated costs and other impacts of the projected changes. The Department and the Contractor agree to meet and discuss the design, development, and costs of the anticipated changes prior to implementation.
   

6. 
   The Contractor shall comply with Title 9, CCR, Section 1840.304, when submitting claims for federal financial participation for services billed by individual or group providers. The Contractor shall submit service codes from the Health Care Procedure Coding System (HCPCS) published in the most current Mental Health Medi-Cal billing manual.
   

7. 
   Payment Data Certification.
   

Contractor shall certify the data it provides to the Department to be used in determining payment of FFP to the Contractor, in accordance with Title 42, CFR, Sections 438.604 and 438.606.

8. 
   System Changes.
   

In the event changes in federal or state law, including court decisions and interpretations, necessitate significant changes in either the fiscal or program operations, or a significant change in the cost of providing covered services the Department and the Contractor agree to meet and consult, pursuant to Section 5777(c) of the Welfare and Institutions Code, regarding (a) changes required to remain in compliance with the new law or significant changes in existing obligations, (b) projected programmatic and fiscal impacts, (c) necessary contract amendments. To the extent that contract amendments are necessary, the parties agree to act to ensure appropriate amendments are made to accommodate any changes required by law.

9. 
   Administrative Reimbursement.
   

The Department shall consult and work with Contractor to determine how federal reimbursement can be obtained for additional or unforeseen administration costs. Consistent with federal and state law, the Department shall process and send to DHCS for reimbursement claims for Medi-Cal Administrative Activity submitted by Contractor within 45 days of receipt.

10. 
    Notification of Request for Contract Amendment.
    

In addition to the provisions in Exhibit D, section 2 below, both parties agree to notify the other party whenever an amendment to this contract is to be requested so that informal discussion and consultation can occur prior to a formal amendment process.

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Exhibit D