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MINUTES
of the
STATE NETWORK COUNCIL MEETING
March 6, 2006
Wichita, KS
Members Present:
Kevin White, Medicine Lodge Memorial Hospital
Mary Adam, Pioneer Health Network
D’Ann Basart, Jewell County Hospital
Bruce Birchell, Greenwood County Hospital
Michelle Bohannon, Wilson County Hospital
Joy Bretz, Gove County Medical Center
Rita Buurman, Sabetha Community Hospital
Aaron Cannon, St. Catherine Hospital
Deanne Freeman, Jewell County Hospital
Jason Friesen, Pioneer Health Network
Heather Fuller, Sunflower Health Network
Laraine Gengler, Lindsborg Community Hospital
Elgin Glanzer, Memorial Hospital
Charlie Grimwood, Salina Regional Medical Center
Vicki Hahn, Wichita County Health Center
David Haneke, Ellinwood District Hospital
Carolyn Hess, Smith County Memorial Hospital
Debbie Hickman, Goodland Regional Medical Center
Joy Huston, Jefferson County Memorial Hospital Inc., and Geriatric Center
Jennifer Jackman, Allen County Hospital
John Jacobson, Atchison Hospital
Joy Johnson, Ottawa County Health Center
Jay Jolly, Goodland Regional Medical Center
Nicki Klein, Hodgeman County Health Center
Les Lacy, Cheyenne County Hospital
Jenny Larrison, Pratt Regional Medical Center
Phil Lowe, Hodgeman County Health Center
Greg Lundstrom, Lindsborg Community Hospital
Everett Lutjemeier, Washington County Hospital
Donna McGowan, Lane County Hospital
Greg McNeil, Lincoln County Hospital
Fred Meis, Graham County Hospital
Mark Miller, Memorial Hospital
Karen Milsap, Central Kansas Medical Center
Vern Minnis, Stafford District Hospital
Gary Montford, Hutchinson Hospital
Patti Moser, Wheat Plains Health Network
Pat Moyer, Cloud County Hospital
Kris Ochs, Grisell Memorial Hospital District No. 1
Robert Ohlen, Bob Wilson Memorial Grant County Hospital
Susan Olson, Wilson County Hospital
Roger Pearson, Ellsworth County Medical Center
Larry Peterson, Allen County Hospital
Deanna Pitman, Wilson County Hospital
Billie Porter, Wilson County Hospital
Terry Pound, Rice County Hospital District No. 1
Julie Quanstrom, Wilson County Hospital
Marinn Rank, Kansas Univ. School of Medicine-Wichita
Mike Ryan, Hillsboro Community Hospital
Steve Schieber, Heartland Hospital
Jodi Schmidt, Hays Medical Center
Betty Shoop, Wilson County Hospital
Mary Steiner, Herington Municipal Hospital
Steve Stewart, Great Plains Health Alliance
Michael Thomas, Meade District Hospital
Joyce Tibbals, Kansas Univ. School of Medicine-Wichita
Gary Tiller, Ninnescah Valley Health Systems, Inc.
Larry VanDerWege, Lindsborg Community Hospital
Shae Veach, Stanton County Health Care Facility
Dale White, Northeast Kansas Center for Health and Wellness, Inc.
Martin Williams, Hospital District #1 of Crawford County
Julie Withams, Graham County Hospital
Maxey Wood, Kansas Univ. School of Medicine-Wichita
Carla Yost, Salina Regional Medical Center
Guests:
Charles Moore, KDHE Office of Childcare and Health Facilities
Emily Nicholson, Technical Assistance and Service Center, Rural Health Resource Center
Ron Smith, Blue Cross/Blue Shield of Kansas
Staff:
Chad Austin, KHA
Chris Tilden, KDHE Office of Local and Rural Health
Gloria Vermie, KDHE Office of Local and Rural Health
WELCOME AND INTRODUCTIONS
State Network Council chair Kevin White called the meeting to order at 11:00 a.m. A summary of the
agenda and presentation handouts were provided to all attendees. The first order of business was to
elect a new State Network Council chair for 2006. Kevin White called on Roger Pearson, nomination
committee chairperson, who made a motion to accept Dale White, Northeast Kansas Center for Health
and Wellness, as chairperson by acclimation. A unanimous vote in favor of Dale White was made.
Chad Austin thanked Kevin White for his service as the State Network Council chairperson and
presented him with a plaque to commemorate his service.
REGULATORY UPDATE
Charles Moore, KDHE, presented a regulatory update to the attendees. Charles indicated a shortage of
the number of KDHE health care surveyors. The agency is in the process of hiring additional
surveyors but these individuals will not be able to conduct surveys until they complete their training –
which takes approximately six months.
Charles also provided an update on certain health care legislation being discussed in Topeka. These
issues were:
Issue: Data Transparency


Infection Reporting (2005 Session) HB 2283 – referred to House Health and Human
Services Committee during 2005 session. No hearing scheduled.
Hospital Outcomes Reporting – bill requested by Representative Tom Holland (DBaldwin). No hearing scheduled.
Issue: Nursing and Workforce
1. Fingerprinting HB 2852 and 2853 – requires fingerprinting and criminal history records
checks for certain licensed professional and practical nurses and mental health technicians.
Referred to House Health subcommittee for hearing. No action taken on bills. Opposed by
KSNA as written.
2. Employment Registry HB 2452 – requires registry of nurses terminated from employment.
Still in House Health and Human Services Committee.
3. ARNP Scope of Practice – HB 2256 – allows for ARNPs to practice independently for
diagnosing and prescribing. Bill was “blessed” and sent back to House Health and Human
Services Committee where a hearing may be scheduled following negotiations between
KMS and KSNA.
Issue: Other Health Care Bills
1. Tobacco Free Hospital Campuses HB 2739 – passed out of House Health and Human
Services Committee. Did not come to the floor for debate due to threat of possible
amendments.
2. Interpreter Bill HB 2825 – establishes voluntary databank of qualified interpreters at
KDHE. Passed House (110 – 15). Senate Public Health and Welfare held hearing but no
final action taken.
3. Trauma Certification HB 2752 – allows KDHE to designate trauma levels. Passed House
(125 – 0). Passed in Senate Public Health Committee and sent to Senate floor.
4. Fire Marshal Bills HB 2974, 2975, 2976, 2977, 2978 – introduced by Rep. Bethell. Bills
focus on education opportunities, requirements, informal dispute resolution and fire safety
product and services registry. HB 2977 (joint education opportunities) passed out of the
House and has been sent to the Senate. HB 2974 and HB 2978 heard in House Public
Safety Committee. HB 2978 was passed by Committee and sent to House Appropriations
Committee. HB 2975 heard in House Commerce and Labor Committee. No final action
taken.
REIMBURSEMENT UPDATE
Ron Smith, Kansas Fiscal Intermediary, provided information regarding several issues impacting rural
and critical access hospitals. At the conclusion of 2005, there were 84 hospitals designated as CAH.
Further issues are outlined below.
1. CAH Interim Rate Setting: The FI goal is to set interim rates that will reflect final
reimbursement as closely as possible. For the 499 total unit provider numbers finalized during
FFY 2005, interim payments made during the period were 98.98% of finalized cost report costs
(in aggregate). The total units consist of freestanding hospital numbers and attached providerbased provider numbers. SNFs, HHAs and TEFRA units are counted as well.
For CAHs we are setting the following interim rates:
Inpatient
Cost Per Patient Day
Swing-bed
Cost Per Patient Day
Outpatient
Cost to Charge Ratio
Rural Health Clinic
Cost RHC Per-Visit
There were 116 CAH hospital (IP and OP) plus swing-bed units finalized during FFY
2005. Each provider number counts as one unit.
CAH
CAH
As-Filed Cost Adjusted Cost
109,634,189
CAH
Interim Payments
110,299,036
107,514,155
Aggregate change from as-filed to NPR’d cost=664,847 or .61%
CAH Interim Payments to Adjusted Cost=97.48%
CAH Interim Payments to As-filed Cost=98.07%
66 out of 116 fell within the range of 90 to 110%.
15 of 116 were paid at the 99-100% level.
During FFY 2005, we completed 152 CAH interim rate reviews. Approximately 20
CAHs submitted Medicare interim cost reports during the year.
There are currently 5 CAHs on Extended Repayment Plans.
Conclusion: Overall accuracy is good, but rates need to be improved on a hospital-by-hospital
basis. The only way this can be accomplished within our current operating budget is to modify
the method of calculating the interim rates. We are looking into some changes that may
improve accuracy.
2. CRNA Interim Reimbursement for CAHS on Method II:
For Method II CAHs, the payment system was reimbursing the CRNA charge X 115% with no
coinsurance calculated. The correct interim reimbursement should be the CAH OP Cost-toCharge Ratio times the CRNA charge less 20% coinsurance. For these CAHs, the interim
reimbursement has been set to pay at the CRNA fee schedule with coinsurance calculated.
Consequently, if your CAH is on Method II and also qualifies for CRNA cost reimbursement,
monitor your CRNA payments. In the interim, you may be getting underpaid. Adjustments
will be necessary to settle these Method II CAHs that qualify for CRNA cost reimbursement at
cost on the Medicare Cost Report.
3. Medicare Cost Report Reopening Policy: (see Attachment 1)
Refer to the Medicare Cost Report Reopening policy on the web at:
http://www.kansasmedicare.com/part_A/reimbursement/2006/pdf/Cost_Report_Reopenin
g_Policy.pdf
Many CAHs are requesting cost report reopenings to correct previously settled presentations.
If doing so, please review this policy to ensure the correct information is submitted.
4. Applying for an Extended Repayment Plan: (see Attachment #2)
If your CAH does not have the funds to pay a balance owed to the Medicare Program, an
Extended Repayment Plan can possibly be obtained. See how to apply for an Extended
Repayment Plan at:
http://www.kansasmedicare.com/part_A/reimbursement/cost_reporting.htm
5. Consideration of Prior Period Adjustments in the Tentative Settlement of the Current
Period Medicare Cost Report: (see Attachment #3)
Effective with cost reports received on or after October 1, 2005, the tentative settlement process
will now include a review of adjustments made to the most recently finalized prior period cost
report. Keep this in mind. The tentative settlement may be different from what you expect.
6. New AQ Health Professional Shortage Area (HPSA) Modifier for Method II CAHs
Effective January 1, 2006:
CMS no longer distinguishes between rural and urban HPSAs. Consequently, the QB (rural
HPSA) and the QU (urban HPSA) will no longer work for services on or after January 1, 2006.
The only HPSA modifier that can be used is AQ. Note: This modifier should not be necessary
as long as the zip code file is correct for your CAH. The zip code file identifies and drives the
HPSA bonus through the CAHs electronic provider file. HPSA and PSA bonuses, if
applicable, are issued quarterly.
7. System Quarterly Payment of PSA (Physician Scarcity Area) Bonus:
Note the payment system is still paying the specialty Physician Scarcity Area 5% Bonus for zip
codes in defined as Specialty Care Service Physician Scarcity Areas even if the services
provided were not specialty care physician services. A system correction is necessary to
terminate this bonus when it is not applicable. When coding physician services on the UB,
ensure that the AH modifier is used for primary care physician services and the AF modifier is
used for specialty care physician services.
8. Lab Bills:
Type of Bill 14X should only be used for non-patient lab specimens (specimen only). In this
case, the bene is not an Inpatient or Outpatient of the hospital.
CAHs should use type of bill 85X for CAH outpatient Lab Services. In order to bill lab as
85X, the patient must be physically present in the hospital as a CAH outpatient.
9. Exclusion of RHC services from SNF Consolidated Billing: Through Section 410 of MMA,
RHC services have been excluded from SNF PPS consolidated billing. This applies to swingbed services as well. Consequently, an RHC visit to a SNF swing-bed patient does not fall
under SNF consolidated billing. This means that a RHC visit to a CAH swing-bed patient may
be billed separately as an RHC visit. If you have questions about this, please consult with your
Provider Representative.
11. Calculation of TEFRA Target Limit for IPFs Located in Critical Access Hospitals
If a CAH reopens a TEFRA unit that was previously open when the CAH was a PPS hospital,
the Target Amount will be the old limit updated by the full Market Basket Factor for each
subsequent period. Refer to CR 4264.
12. Reminder for Method II CAHs:
If new professionals are added to Method II participation during the year, we will need the
name and UPIN. In addition, we will need the 855R form for the individual. In addition, if
off-site locations are added for the provision of CAH OP services, we will need to know the zip
code for the location of the off-site services. This does not apply to RHC services.
FUTURE OF THE FLEX PROGRAM
Emily Nicholson, TASC Program Coordinator with the Rural Health Resource Center provided an
overview of the future of the FLEX program. The Rural Health Resource Center is designed to
provide technical assistance, information, tools and resources for the improvement of rural health care.
Emily provided background information regarding the FLEX program, including its inception in the
Balanced Budget Act of 1997.
Emily presented information regarding the number of critical access hospitals throughout the country.
Thus far, Kansas leads the nation with 84 critical access hospitals. Kansas is followed by Iowa (80)
and Minnesota (80).
Some of the challenges that will be faced by rural health care providers were identified by Emily. She
cited maintaining critical access hospital status, funding, HIT implementation, and quality
improvement as critical areas for rural health care providers.
KRHOP PROJECT UPDATE
Chad Austin and Chris Tilden provided an overview of the Kansas Rural Health Options Project. The
discussion surrounded the partners included in the project, distribution of funds, resources necessary
for staffing the project, and the amount of funds received over the past seven years. Further, an update
was provided regarding the various Kansas Rural Health Option Project funded activities. Current
activities being implemented include:
1) Rural Health Works
 Kansas State University continues to implement the community planning portion of the
Rural Health Works program in two additional communities (Stafford, Oakley).
KRHOP will be soliciting hospitals to participate in another pilot program in early
summer.
 The purpose of the KRHW program is to expand public awareness of the importance of
the economic impact of the health care sector and stress its critical role in rural
development. Armed with this knowledge, it is anticipated that local decision-makers
will then become proactive and involved in planning and supporting their local health
care system. This project will provide information to support strong, visionary
leadership in rural communities, resulting in healthier rural communities and
economies.
If your hospital or community would be interested in the KRHW program, please
contact Chad Austin at the KHA office.
2) Quality Health Indicators (QHi)
 There are nearly 30 hospitals participating in the Quality Health Indicators program.
KRHOP will be soliciting additional networks and hospitals to participate in the
program. A demonstration of the site may be found at www.kha-net.org.
3) Quality Assessment Program
 KRHOP has contracted with Darlene Bainbridge to conduct on-site and on-line
assessments of the quality programs currently being used in rural hospitals. The
program has been expanded to include more than 20 critical access hospitals. KRHOP
is considering replication of the Quality Assessment Program for the 2006/2007 FLEX
grant. Kansas Recruitment Center
4) Strategic planning program, including the development of a logic model
 KRHOP has been working with John Gale from Maine to assist in the strategic planning
process and the creation of a logic model. An initial meeting with Mr. Gale occurred in
early November.
5) Diabetes Management Program
 KRHOP has partnered with the KDHE – Bureau of Health Promotion to replicate a
diabetes management program in two critical access hospitals. The program will
provide training to health care providers related to the evaluation and treatment of
diabetes. KRHOP is considering partnering again with KDHE – Bureau of Health
Promotions to replicate the project for 2006/2007.
6) KRHOP and Network Web sites

KRHOP continues to developed its new Web site (www.krhop.net) which will make
communication of activities and programs much easier to rural health care providers. In
addition, KRHOP recently funded an additional network Web site. Networks interested
in creating a Web site should contact Chad Austin or Chris Tilden.
7) Trauma Education
 KRHOP is in the process of replicating the trauma education courses that were offered
last year. The programs will focus on ATLS, PHTLS, Rural Trauma Team
Development Course, and Trauma Nurse Core Course. Additional information
regarding the program will be available in the near future.
8) General Education
 KRHOP is partnering with KHA to develop a New Board Member Orientation Packet.
The packet will include a variety of information including what the role of a board
member should be and how a board can conduct a self-evaluation.
9) Financial Health of Rural Hospital
 KHROP is working with John Wendling to evaluate the financial health of the Kansas
critical access hospital program. New information obtained will be compared to a
similar study conducted in early 2000.
ADJOURNMENT
The meeting was adjourned at 1:15 p.m. The next meeting of the State Network Council has not yet
been set.