Notice of Interest Rate on Required Residential Mortgage
Loan Escrow Accounts For 2008

Under Section 138.052 (5) (a), Stats., with some exceptions, a bank, credit union, savings bank, savings and loan association, or mortgage banker, which originates a residential mortgage loan requiring an escrow account to assure the payment of taxes or insurance, shall pay interest on the outstanding principal of the escrow.

Section 138.052 (5) (am) 2., Stats., directs the division of banking to determine annually the required interest rate. The rate is based on the average of interest rates paid on regular passbook deposit accounts by institutions under the division of banking's or office of credit unions' jurisdiction.

The Department of Financial Institutions, Division of Banking, has calculated the interest rate required to be paid on escrow accounts under Section 138.052 (5), Stats., to be 0.94% for 2008. This interest rate shall remain in effect through December 31, 2008.

Contact Person

Mr. Michael J. Mach, Administrator
Department of Financial Institutions
Division of Banking
Telephone (608) 261-7578

The State of Wisconsin reimburses Medicaid-certified nursing facilities for long-term care and health care services provided to eligible persons under the authority of Title XIX of the Federal Social Security Act and ss. 49.43 to 49.47, Wisconsin Statutes. This program, administered by the State's Department of Health and Family Services, is called Medical Assistance (MA) or Medicaid. Federal Statutes and regulations require that a state plan be developed that provides the methods and standards for setting payment rates for nursing facility services covered by the payment system. A plan that describes the nursing home reimbursement system for Wisconsin is now in effect as approved by the Centers for Medicare and Medicaid Services (CMS).

The Department is proposing changes in the methods of payment to nursing homes and, therefore, in the plan describing the nursing home reimbursement system. The changes are effective January 1, 2008.

The proposed changes would update the payment system and make various payment-related policy changes. Some of the changes are necessary to implement various budget policies in the Wisconsin 2007-2009 Biennial Budget. Some of the changes are technical in nature; some clarify various payment plan provisions.

The estimated increase in annual aggregate expenditures attributable to these changes for nursing homes serving MA residents is approximately $1,426,255 all funds, ($821,237 FFP), excluding patient liability.

The proposed changes are being implemented to comply with Wisconsin Statutes governing Medicaid payment systems, particularly s. 49.45 (6m), Wis. Stats.

The proposed changes are as follows:

1.   Modify the methodology to adjust the reimbursement for nursing homes within the parameters of 2007-2009 Biennial Budget Bill and to disburse the $1,426,255 allotted in the bills to a rate increase of approximately 2% for ICFs-MR. These modifications will include adjustments to the Medicaid Access Incentive for ICFs-MR in section 5.942 and create a new incentive payment in section 3.600 for ICFs-MR. It is estimated that these adjustments will provide an increase of 0.9% for State operated ICFs-MR and 5.5% for privately operated ICFs-MR.

2.   Modify the labor factors in Section 5.410.

3.   Implement any modifications as directed by State statutory changes or non-statutory language in the 2007-09 state budget.

Copies of the Proposed Changes

Copies of the available proposed changes and proposed rates may be obtained free of charge by writing to:

Division of Long Term Care
Attention: Nursing Home Medicaid Payment Plan
P.O. Box 7851
Madison, WI 53703-7851

or by faxing James Cobb at 608-264-7720.

The available proposed changes may be reviewed at the main office at any county department of social services or human services office.

Written comments on the proposed changes may be sent to the Division of Health Care Financing, at the above address. The comments will be available for public review between the hours of 7:45 a.m. and 4:30 p.m. daily in Room 350 of the State Office Building, 1 West Wilson Street, Madison, Wisconsin. Revisions may be made in the proposed changes based on comments received. There will also be public meetings to seek input on the proposed plan amendment. If you would like to be sent a public meeting notice, please write to the above address. Revisions may, also, be made in the proposed changes based on comments received at these forums.

The State of Wisconsin reimburses hospitals for inpatient hospital services provided to Medical Assistance recipients under the authority of Title XIX of the Social Security Act and Chapter 49 of Wisconsin Statutes. This program, administered by the State's Department of Health and Family Services, is called Medicaid or Medical Assistance.

Under current law, Wisconsin hospitals are paid on a reimbursement system based on Diagnosis Related Groupings (DRGs). The DRG system covers Acute Care Hospitals, Children's Hospitals and Major Border Status Hospitals. Each hospital is assigned a unique hospital specific cost-based DRG rate. In addition, a cost outlier payment is made when the cost of providing services exceeds a pre-determined trimpoint. The Department intends to modify the inpatient rate setting methodology for Acute Care Hospitals, Children's Hospitals and Major Border Status Hospitals to reflect the budget approved by the Legislature.

The Department is proposing to implement a rate setting methodology change for these providers that would establish provider payment rates to the approved SFY 2007 levels. This change will impact inpatient hospital services provided by: Acute Care Hospitals, Children's Hospitals and Major Border Status Hospitals. The effective date for these proposed changes will be January 1, 2008; however, rate adjustments will impact all SFY 2008 claims.

Acute Care Hospitals, Children's Hospitals and Major Border Status Hospitals

Under the proposed changes, the Department will reimburse hospitals based on Diagnosis Related Groupings (DRGs). The Department will adjust DRG payment rates in a way such that, when combined with the rates in effect for July 1, 2007 to December 31, 2007, the aggregate effect is to freeze each hospital's DRG payment rate at the final approved SFY 2007 rate. Under this methodology, each hospital is assigned a hospital specific DRG base rate. This rate includes adjustments for differences in wage levels, includes an amount for capital expenditures, and payment enhancements for qualifying Disproportionate Share Hospitals and facilities with Graduate Medical Education programs. In addition, a cost outlier payment is made when the cost of providing services exceeds a pre-determined trimpoint. The provider specific, cost based DRG rates for providers are adjusted as necessary to ensure budget compliance.

Proposed Change

The proposed change is to the adjust DRG payment rates in a way such that, when combined with the rates in effect for July 1, 2007 to December 31, 2007, the aggregate effect is to freeze each hospital's DRG payment rate at the final approved SFY 2007 rate.

There is no change in the definition of those eligible to receive benefits under Medicaid, and the benefits available to eligible recipients remain the same. The effective date for these proposed changes will be January 1, 2008 with rate adjustments impacting all SFY 2008 claims.

Copies of the Proposed Change

A copy of the proposed change may be obtained free of charge at your local county agency or by calling or writing as follows:

Regular Mail
Division of Health Care Financing
P.O. Box 309
Madison, 53701-0309

Phone
James Vavra, Director
Bureau of Fee-for-Service Health Care Benefits
(608) 261-7838

FAX
(608) 266-1096
Attention: James Vavra

E-Mail
vavrajj@dhfs.state.wi.us

A copy of the proposed change is available for review at the main office of any county department of social services or human services.

Written Comments

Written comments are welcome. Written comments on the proposed change may be sent by FAX, e-mail, or regular mail to the Division of Health Care Financing. The FAX number is (608) 266-1096. The e-mail address is vavrajj@dhfs.state.wi.us. Regular mail can be sent to the above address. All written comments will be reviewed and considered.

All written comments received will be available for public review between the hours of 7:45 a.m. and 4:30 p.m. daily in Room 350 of the State Office Building, 1 West Wilson Street, Madison, Wisconsin. Revisions may be made in the proposed changed methodology based on comments received.