What’s happening: We have identified a substantial error in the DMAS/Mercer calculation of the total nurse staffing metric results/payments under the new Value-Based Purchasing (VBP) Program with impacts varying by facility.

• It appears that DMAS/Mercer used the “CMS Expected Staffing” ratio from the PBJ quarterly reports, not the “Adjusted” ratio, which considers case mix against a facility’s actual nursing hours.
• DMAS is in the process of verifying the error and then determining how it would approach adjusting the payments.

What it means: Because the wrong metric was used, the performance results and payment amounts (both attainment and improvement) are wrong for this metric and need to be recalculated for every facility.

• Once DMAS verifies the issue with Mercer, they will need to redo the analysis for that metric using the correct PBJ ratio and redetermine results/payments.

• We do not yet know what DMAS will do about the payments that are in process now to the MCOs. Payments could be ceased before they are distributed to the facilities, or the agency could allow the payments to proceed and establish a subsequent reconciliation for the payment for this metric.
• Of note, we have requested that DMAS allow the current, albeit inaccurate, payments to continue, and implement reconciliation after the fact.

Action for facilities: VHCA-VCAL recommends that you consider strongly whether and how you want to obligate any of the VBP funds you were expecting to receive in the next few weeks.

• If DMAS ceases the payment cycle to correct payment for this metric, there will be an additional delay before any funds are received, as the four metrics are co-mingled in the payment amounts.

• If DMAS decides to continue the payment schedule with the incorrect amounts, any post-payment reconciliation will have implications given that you do not yet know the amounts involved.
  • Based on an initial VHCA-VCAL analysis, the differences requiring reconciliation may be significant.

We are very sorry that this has happened. This is an evolving issue, and we are pursuing clarity. 

• We have had numerous conversations with DMAS officials since we identified this issue yesterday (thanks to input from a member which could not replicate their total staffing metric results as calculated by DMAS/Mercer).
• We are reviewing source data for the other three metrics to determine if any technical errors were made in those calculations as well.