Payments in Future Years and Mid-Year Rate Adjustments Clause Samples
The "Payments in Future Years and Mid-Year Rate Adjustments" clause governs how payments are handled in subsequent contract years and outlines the process for adjusting rates partway through a year. Typically, this clause specifies the timing and calculation method for future payments, and details how and when rate changes may be implemented, such as prorating new rates for the remainder of the year after an adjustment. Its core function is to provide a clear framework for managing ongoing financial obligations and adapting to changing costs, thereby reducing disputes and ensuring predictability for both parties.
Payments in Future Years and Mid-Year Rate Adjustments. A. Rates will be updated using a similar process for each calendar year. Changes to the baseline outside of the annual Medicare Advantage rate announcement would occur only if and when CMS and the State jointly determine the change is necessary to calculate accurate payment rates for the Demonstration. Such changes may be based on the following factors: shifts in enrollment assumptions; major changes in Federal law and/or State law or policy; and changes in coding intensity.
B. If Congress acts to delay or replace the Sustainable Growth Rate (SGR) formula used to adjust Medicare physician payment rates, CMS will adjust the Medicare baseline for beneficiaries who otherwise would have been enrolled in Original FFS Medicare to reflect the revised current law physician payment rates. If Congress applies changes retroactively after the SGR cuts are scheduled to go into effect, CMS will adjust the rates retroactively as well. If other State or federal statutory changes enacted after the annual baseline determination and rate development process are jointly determined by CMS and the State to have a material change in baseline estimates for any given payment year, baseline estimates and corresponding standardized payment rates shall be updated outside of the annual rate development process.
C. Changes to the savings percentages would occur if and when CMS and the State jointly determine that changes in Part D spending have resulted in materially higher or lower savings that need to be recouped through higher or lower savings percentages applied to the Medicare A/B baselines.
Payments in Future Years and Mid-Year Rate Adjustments. A. Rates will be updated using a similar process for each calendar year. Rate updates will take place on January 1st of each calendar year for the Medicare components of the rates, with changes to savings percentages applicable on a Demonstration Year basis. Rate updates for the Medicaid component of the rates will take place at least once each California state fiscal year and may be more often as necessary to match adjustments made to the Medicaid capitation rates in the contracts that support the 1115(a) demonstration program that would apply for beneficiaries in the target population who do not enroll in this Demonstration. Adjustments to the Medicaid component of the rates may be done retroactively, if necessary to match the Medicaid baseline rates. Changes to the baseline outside of the annual Medicare Advantage rate announcement and/or typical Medicaid rate adjustment process would occur only if and when CMS and the State jointly determine the change is necessary to calculate reasonable, appropriate, and attainable payment rates for the Demonstration. Such changes may be based on, the following factors: shifts in enrollment assumptions; changes due to litigation; changes in Federal law and/or State policy; changes in coding intensity, and other factors as determined appropriate and approved by CMS and the State.
B. If Congress acts to suspend or overturn the applicable Sustainable Growth Rate (SGR) formula used to adjust Medicare physician payment rates, CMS will adjust the Medicare baseline for beneficiaries who otherwise would have been in Original Fee-for-Service Medicare to reflect the revised current law physician payment rates. If Congress acts after the SGR formula is scheduled to go in effect but applies changes retroactively, CMS will adjust the rates here retroactively, as well. If other statutory changes enacted after the annual baseline determination and rate development process are jointly determined by CMS and the State to have a material change in baseline estimates for any given payment year, baseline estimates and corresponding standardized payment rates shall be updated outside of the usual rate development process.
Payments in Future Years and Mid-Year Rate Adjustments. A. Rates will be updated using a similar process for each calendar year. Changes to the baseline (and therefore to the corresponding payment rate) outside of the annual Medicare Advantage rate announcement would occur only if and when CMS and MDCH jointly determine the change is necessary to calculate accurate payment rates for the Demonstration. For changes solely affecting the Medicare program baseline, CMS will consult with MDCH prior to making any adjustment, but MDCH concurrence will not be required. Changes may be based on the following factors: shifts in enrollment assumptions; major changes or discrepancies in federal law and/or State law or policy compared to assumptions about federal law and/or State law or policy used in the development of baseline estimates; and changes in coding intensity. CMS and/or MDCH will make changes to baseline estimates within 30 days of identification of the need for such changes, and changes will be applied on a retrospective basis, if necessary, to effectuate accurate payment rates for each month.
B. Changes to the savings percentages would occur if and when CMS and MDCH jointly determine that changes in Part D spending have resulted in materially higher or lower savings that need to be recouped through higher or lower savings percentages applied to the Medicare A/B baselines.