May 23, 2013

APR-DRG Transition Update

The 2013 Legislature approved the conversion of the Medicaid inpatient hospital payment system from per diem to the new APR- DRG payment methodology in the General Appropriations Act for Fiscal Year 2013-14. This conversion, scheduled to be implemented by July 1, 2013, included $88 million in transitional funding to smooth the payment variances created by the conversion. Governor Scott approved the transitional inpatient payments of $65 million for direct Medicaid rates but vetoed the additional $23 million for the Prepaid Health Plans line item, which would have funded increased rates paid for inpatient services by health plans.

The following table shows the final approved base rate and the major policy decisions related to the use of the APR-DRG payment model:


Training programs are currently being developed by both the FHA in conjunction with 3M and by the Medicaid fiscal agent contractor HP. The HP training sessions will be conducted from late May through June. View more information on the upcoming training sessions. Register online for the FHA training session. HP has also created a Web site with frequently asked questions and additional information on the APR-DRG conversion.