EXIHIBIT A

SCOPE OF SERVICES
for
Development of an Affordable Assisted Living
Rate Setting Methodology

The following describes services to be provided in the development of an affordable assisted living rate setting methodology. Work progress and products described below will be reviewed and discussed with WHEDA and DHFS as each part is completed, and adjustments will be made as needed and agreed to by all parties. Although not anticipated at this time, adjustments scope and cost may also be required if federal MA administrative match for the project is not approved.

PART 1: ANALYZE LEGAL FRAMEWORK FOR RCAC RATE-SETTING

Identify, review and analyze the state and federal law, regulations, and policies that provide the legal framework for public reimbursement of RCAC assisted living services. This analysis shall identify all applicable requirements with which the rate-setting methodology will have to comply, the source(s) of each requirement, the implications for rates and payment methods, and whether the requirement could be changed or reinterpreted as a matter of administrative policy. If there are any conflicts between requirements from different sources, these should also be identified.

Statutory, regulatory and policy documents to be analyzed include but are not limited to those listed below. Confer with knowledgeable sources to assure that all applicable requirements have been identified. As part of the analysis, review how other states interpret federal requirements and fund residential services.

• Requirements for public sector contracting
  • GAO, Government Auditing Standards, current version
  • OMB Circular A-133, Audits of Institutions of Higher Education and Other Nonprofit Institutions
  • OMB Circular A-87, Principles for Determining Costs Applicable to Grants and Contracts with State and Local Governments
  • A Guide for Non-Profit Institutions, Cost Principles and Procedures for Establishing Indirect Cost and Other Rates, OASC-5
  • Wisconsin State Statutes, Section 46.036, Purchase of Care and Services
  • State of Wisconsin, State Single Audit Guidelines, Standards and Procedures, current edition; and Appendix F, "Compliance Supplement ­ State Financial Assistance Programs"
  • Wisconsin Department of Health and Family Services, Provider Agency Audit Guide, current edition
  • Wisconsin Department of Health and Family Services, Allowable Cost Policy Manual.
  • Wisconsin Department of Health and Family Services, Financial Management Manual for Counties, Tribes, and 51 Boards.
  • Any DSL memo series memos that speak to these contracting requirements.
• MA and MA Waiver Programs
• Applicable Federal laws and regulations
• Approved WI waiver applications (COP-W, CIP II, Family Care)
• Wisconsin’s MA Waiver manual and Family Care contract
• Applicable state statutes
• Administrative rules ­ Medical Assistance, Family Care
• MA State Plan - MA Provider handbook
• RCAC administrative rule

Report/documentation to be prepared. Organized presentation of current laws, regulations and policies that is written to be understandable to all stakeholder groups, summarizes requirements which apply to rate setting and reimbursement/payment, highlights those requirements with the greatest impact on the rate setting method; identifies their implications for the type of methodology to be developed, and identifies the type of action needed to change the requirement, if needed.

Completion Date: December 15, 2002

PART 2: REVIEW CURRENT PRACTICE

Review and analyze current practices in serving MA Waiver clients in RCACs, including a survey of county human service agencies regarding use of RCACs for MA Waiver/Card clients, including but not limited to:

• Whether the county has elected to use certified RCACs as an option for MA Waiver clients
• The number of county MA Waiver clients living in certified RCACs and the facilities they use
• The types and amounts of RCAC services typically included in the care plans for MA waiver clients living in RCACs
• The method(s) the county use to establish payment for RCAC services provided to MA Waiver clients
• The amount counties are currently paying for RCAC services provided to MA Waiver clients.
• Whether and how, if so, the MA card is used to pay for personal care or any other services provided to residents of RCACs
• How room and board rates are established for MA waiver participants, the amount charged for room and for board (separately) for MA Waiver participants, and the process by which room and board charges are paid.

Additional detail on how accomplished:

• Work with DHFS data to get complete expenditure information for waiver clients with SPC code 711 (RCAC). This will provide information on both waiver and MA card costs.
• Review and analyze information on file at TMG on RCACs with waiver clients. This includes information on what counties, rate levels, and rate-setting methodology.
• Review care plans on file at TMG for information on services received. Follow-up interviews with case managers to get specific up-to-date information.
• Using this information, develop analysis of current practice and expenditure patterns.

Report/documentation: Summary report that describes current practice and expenditure patterns, tables and charts containing the data described above, and comparative chart(s) showing county rates for services and current payment methodologies.

Completion Date: November 15, 2002

PART 3: IDENTIFY AND RECONCILE STAKEHOLDER NEEDS

Identify and analyze stakeholder experience and positions regarding use of the MA Waivers, Family Care and MA card to pay for RCAC services. Explore stakeholder needs and issues identified in "Requirements for RCAC Rate Setting Methodology" included as Attachment 1 to the RFP and on the Wisconsin Affordable Assisted Living web site in greater detail. Identify areas where there is common ground, lack of mutual understanding, and/or potential conflict. Work with groups to reconcile conflicting interests. A list of stakeholder contacts is included in Attachment 1. While this list identifies most stakeholders, the contractor may also include others.

• Association and Committee Meetings. Meet with organizations representing the different stakeholder groups, including but not limited to the RCAC Forum, assisted living industry trade associations, the County Human Service Association Long Term Support Committee, county COP coordinators and the Family Care Provider Network Work Group, to discuss the goals of this project, the need for their collaboration, the challenges they face when placing and paying for MA Waiver clients in RCACs, and suggestions for improvement.
• In-depth Interviews. Conduct at least 4 in-depth interviews with individual RCAC owners and 3 county human service agencies. County and provider representatives should be selected to represent a variety of provider types (taken from a variety of: urban, suburban, rural locations; sizes; corporate structures ­ for profit, not for profit entities; and owners with RCACs in one location and multiple locations) and county situations (urban and rural, those that use a lot of facility based care and those that do not, those that are proactive in managing rates and those that are not) County interviews should include both long term support and fiscal staff.
• Stakeholder Committees and/or Focus Groups. Conduct approximately 5 in-depth, half-day focus group or other group meetings with each group of stakeholders, including RCAC providers and their CPA auditors and county human service agencies and their long term support and fiscal staff, to ascertain their experience, opinions, and challenges about entering contracts for delivery of RCAC services to MA Waiver clients.
• State Program Representatives. Interview and/or meet with DHFS program staff (including MA Waiver, MA fee-for-service, income maintenance and area administration staff); WHEDA staff; and others as may be determined to be necessary for development of a method that permits maximum use of all public programs and benefits for which a resident may qualify.
• Combined County and Provider Stakeholder Meetings. Conduct approximately 3 full-day meetings with key stakeholders to understand each other’s needs, reconcile differences, and make recommendations.

Report/documents to be provided: Written report based on the results of interviews and focus group discussions which clarifies the needs of the different stakeholder groups and subgroups; identifies the key issues for each group and points out areas where there is agreement, where there is conflict, and where further work is necessary; suggests ways to reconcile differences, where possible; and identifies implications for the rate setting method.

Completion Date: March 1, 2003

PART 4: ANALYZE RCAC SERVICES AND COSTS

Analyze RCAC services and costs, including detailed information on the types and amounts of RCAC services typically used by MA Waiver clients, the costs associated with providing those services, and administrative and other costs not directly attributable to client services.

• Analyze research from stakeholder interviews, analysis of Waiver client data, industry studies, and publications.
• Identify the range and distribution of client costs, analyze the association between resident care needs and the cost of services provided, and identify the key cost centers and other factors contributing to cost.
• Complete comparative analysis and additional research on substantial deviations.
• Create summary of primary and secondary services and cost ranges.

Reports/Documents to be provided: Written report containing the results of the above analysis. Correlated feedback from interviews/focus groups; comparative analysis of services and costs both direct and indirect with summary of services and cost ranges.

Completion Date: May 1, 2003

PART 5: RECOMMEND INITIAL RATE-SETTING APPROACH

Analyze results of above listed research and fact gathering activities and, based on that analysis, develop a recommended approach to the rate setting model.

Additional details on how accomplished:

• Examine the prior data for costs against the information gained and make adjustments as required. Consider economic and regulatory constraints. Review potential impact of funding sources on model creation and functionality.
• Develop a first draft concept for review with members of WHEDA and DHFS staff.
• Prepare basic model and begin to create elements of flexibility as required by region or cost element.
• Consider the ability of the rate setting model to function in a lending environment and discuss with WHEDA.
• Review model as constructed with WHEDA and DHFS staff and prepare cover letter, etc. for publication and comment period to the WI Affordable Assisted Living Cost Allocation and Rate Setting Work Group.
• Obtain input from WI Affordable Assisted Living Cost Allocation and Rate Setting Work Group before finalizing recommendation.

Reports/Documents to be provided: Draft outline of model approach; correlated notes on feedback from stakeholders; base model

Completion Date: June 1, 2003

PART 6: CREATE MODEL

Building on the initial model concept, develop a method for counties and providers to use in jointly establishing rates for RCAC services provided to MA Waiver clients, including charges to the Community Options Program Waiver, Community Integration Program II Waiver or Family Care, to the MA card, and to the resident. To be successful, the model must:

• Be acceptable to all major stakeholder groups, including RCAC providers, county human service agencies as purchasers of services for MA Waiver clients, and DHFS and WHEDA;
• Generate payment that provides adequate reimbursement for RCAC providers and value for the county human service agencies as purchasers of service for MA Waiver clients;
• Clearly identify cost components consistent with program requirements for the MA Waiver, MA fee-for-service system, housing finance programs and rental assistance voucher program to maximize access to a variety of public funding sources;
• Be adaptable to fit different local situations and to allow for updating in response changes in the regulatory and funding environment over time.
• Be in an electronic format using widely available computer software program;
• Be easy to use and understand; and
• Be made available in a format suitable for dissemination through the www.WIaffordableassistedliving.org web site.

Review product with WHEDA, DHFS and the WAAL Rate Setting Work Group before finalizing.

Reports/Documents to be provided: Outline of model, an executive summary that explains how the model works, and model.

Completion Date: July 15, 2003

PART 7: DEVELOP USER GUIDE

Develop a user guide explaining how to use the model in a clear and easy to follow manner. The user guide shall define all terms used in the model and present information in a way that is readable and understandable to people who have only a basic, and not sophisticated, understanding of accounting, computers and the business aspects of an RCAC assisted living facility. The product shall be a single manual for use by all user groups, but may have separate chapters designed for particular user groups such as counties or providers. The guide shall be developed in an electronic format suitable for placement on the Affordable Assisted Living web site. A draft of guide shall be reviewed with appropriate staff from WHEDA, DHFS, and the WAAL Rate Setting Work Group before it is finalized.

Report/Documents Provided: Summary outline of User Guide, User Guide

Completion Date: July 15, 2003

PART 8: PILOT TEST MODEL

Assist two or more counties, in piloting the model in the first half of 2003. This will involve training and problem solving with the county or counties and RCAC providers who volunteer to test the initial rate setting model.

• Select pilots that include at least one small and one medium to large county that currently use different approaches to RCAC reimbursement. If possible a Family Care county should also be included.
• Meet with COP coordinators and county fiscal staff (or CMO staff in Family Care county) and RCAC administrators in selected pilot test counties.
• Explain pilot and methodology to pilot test counties in terms understandable to human services and provider audiences. Provide training necessary to users and be available to answer questions and assist county and facility staff in implementing the model throughout the pilot period.
• Monitor experience with the pilot and make modifications to the model and user guide based on that experience.

Reports/documents to be provided: Beta test work plan, feedback documents, correlated notes from pilot testing. A written report describing the pilots experience with the model, including what worked well and what did not, identifying technical and policy issues raised by the pilot test, and recommending ways to address these issues.

Completion Date: July 15, 2003

PART 9: REVISE MODEL AND USER GUIDE

Revise the model based on results of the pilot test. Complete the final model and updated user materials by August 2003, so that it can be available for counties to use in negotiating rates for calendar year 2004.

• Modify the model as required from the beta/pilot test segment of the task.
• Internally review changes for functionality.
• Confer with WHEDA, DHFS and the WAAL Rate Setting Work Group regarding any additional items requested for change.

Reports/Documents to be provided: Revised model and updated user materials

Completion Date: August 15, 2003

PART 10: CONDUCT TRAINING

Conduct training on the model for state and county long-term support and fiscal staff and for RCAC providers in the early fall of 2003. Training may be done at trade association conferences and regularly scheduled county long-term support coordinators meetings or in special training sessions.

Reports/Documents to be produced: Training documents, reference list, and contact sheet

Completion Date: September 30, 2003

PART 11: PROVIDE CONTINUING CONSULTATION AND TRAINING

Be available to consult with state and county staff and RCAC providers after implementation of the model. Consultation may be billed to recipients at a mutually agreed upon hourly rate. Continuing consultation and training will not be reimbursed under this contract.