1. FINANCIAL MANAGEMENT SERVICES
For Self-Directed Waiver Services in Kansas
Presented by: Kansas Department on Aging
March - April 2011
Welcome! Announce waiver related people in the room.

2. Overview What is Financial Management Services (FMS)?
Requirements to be an FMS provider
Responsibilities of the:
Self-Directing Individual
Agency with Choice FMS
Information & Assistance (I&A)
Payment for FMS
Enrollment
This training session is for current payroll agent providers that bill for self-directed waiver services. If you are not currently doing this the information will not be applicable to your entity and you may sign off. Any targeted case managers on the call will need to sign off and attend the session specific to TCM in May.

3. Questions Please submit questions in writing via:
Chat on the webinar
directly to
All submitted questions will be compiled into a Q&A document to be posted at ovider_index.html after the last session is held

4. What is Financial Management Services (FMS)?
FMS is a new waiver service for the administrative and information & assistance functions for self-directing individuals
Replaces current payroll agent process
Kansas has elected to operate FMS as an Agency with Choice (AWC) employer model
This training will focus on the definition; responsibilities; and new enrollment requirements for FMS. The Medicaid Reform team at the Governors level in cooperation with CMS is looking at all Medicaid programs including the waivers therefore specific payment rates and implementation dates will not be known until the Medicaid Reform team has finalized their process.

5. Why change to Financial Management Services (FMS)?
Centers for Medicare and Medicaid Services (CMS) new requirement
Separates administrative functions from direct service payment rates
Incorporates more stringent requirements
This has been a multi year process involving many providers and stakeholders input. Today’s session is not for debating the requirements/etc but rather to notify you of the information and what the upcoming requirements will be so you can make a solid decision as to whether or not to move forward in enrolling.

6. Important Terms
Direct Support Worker – (DSW): the person hired to provide direct care paid through HCBS.
Employment Services Agreement – an agreement between the self-directing individual and the DSW that identifies the responsibilities/duties of all parties.

7. Important Terms
Service Agreement –an agreement between the FMS provider and the self- directing individual. This authorizes the FMS provider to accept timesheets, bill Medicaid, process payroll, distribute paychecks; withhold, file, and pay taxes. Also identifies the responsibilities/duties of all parties.

8. Important Terms
SRS/KDOA Provider Agreement - an agreement between the State of Kansas (SRS and/or KDOA) and a provider organization. It authorizes a provider to function as a FMS provider agency.
The agreement will be with both agencies if doing both SRS and FE waivers. Agreement would be only with SRS if only doing SRS waivers and only with KDOA if only doing FE waiver.

9. Requirements to be an FMS provider
Each potential Agency With Choice Financial Management Services (FMS)entity must meet the following requirements:
SRS/KDOA Provider Agreement
Medicaid Provider Agreement
Registration with the Secretary of State’s Office, if required.
SRS/KDOA application must be completed and signed by all parties and included with Medicaid Provider Agreement.
If registered with Secretary of State’s Office:
Be in good standing with all Kansas laws/business requirements.
Owners/Principles/Administrators/Operators have no convictions of embezzlement, felony theft, or fraud.
Owner, primary operator and administrator of FMS business must live in a separate household from individuals receiving services from the FMS business.
Business is established to provide FMS to more than one individual.

10. Requirements to be an FMS provider
Each potential Agency With Choice Financial Management Services (FMS)entity must meet the following requirements:
Insurance defined as:
Liability insurance
Workers Compensation Insurance
Unemployment Insurance, if applicable
Other Insurances, if applicable
Annual Independent Financial Audit
Demonstrate financial solvency
Maintain required policies/procedures
Annual liability with a $500,000 minimum.
Evidence that 30 days coverage of operation costs are met for Financial solvency – see manual for what qualifies as evidence

11. Policies and Procedures shall include but are not limited to:
Billing Medicaid with approved rates, and for services as authorized by POC.
Billing FMS administrative fee
Receive and disburse Medicaid funds, track disbursements and provide reports
Semi-annual reports to self-direct individuals for billing/disbursements on their behalf
Report to the State of Kansas as requested

12. Policies and Procedures shall include but are not limited to:
Ensure proper/appropriate background checks are conducted
Ensure that self-directing individuals follow the pay rate procedures
Clear identification of how this will occur
Prohibition of wage/benefit setting by FMS provider
Prohibition of “recruitment” practices (HCBS waiver customers and/or DSW staff)
Prohibit “recruitment” by promises/enticements of higher pay or benefits

13. Policies and Procedures shall include but are not limited to:
Ensure proper/appropriate process of timesheets, disbursement of pay checks, filing of taxes and other associated responsibilities
The provision of Information & Assistance services
Grievance Procedures
The grievance policy is designed to assure a method for Direct Support Workers to utilize to address hours paid that differ from hours worked, lack of timely pay checks, bounced pay checks, and other FMS related issues.

14. Responsibilities - Individual
Decision making authority over certain services and manages their services with the assistance of a system of available supports.
Choice of qualified and available FMS providers
when choice is made to self-direct and annually thereafter.
Review of Customer responsibilities.

15. Responsibilities - Individual
Direct the services in the individual’s approved Plan of Care (POC) and the Direct Support Workers
Access and participate in the development of all plans including planning, startup, delivery and administration of providers’ services.
Informed of the roles and responsibilities related to the FMS provider.

16. Responsibilities - Individual
Work collaboratively with their FMS provider to meet shared objectives:
Receive high quality services
Receive needed services from qualified workers
Tasks are provided in accordance with state law governing self-direction, Medicaid and the State of Kansas requirements, and are approved and authorized in the POC

17. Responsibilities - Individual
Act as the employer for Direct Support Workers
Negotiate a FMS Service Agreement with the chosen FMS provider
Select Direct Support Worker(s)
Refer Direct Support Workers to the chosen FMS provider
Refer Direct Support Workers to the FMS provider for completion of required human resources and payroll documentation. In cooperation with the FMS provider, all employment verification and payroll forms must be completed.

18. Responsibilities - Individual
Negotiate an Employment Service Agreement with the Direct Support Worker
Provide or arrange for appropriate orientation and training of Direct Support Worker(s).
Determine schedules of Direct Support Worker(s)
Determine tasks to be performed by Direct Support Worker(s) including where and when
Determine when/where tasks are to be performed in accordance with the approved and authorized POC /CSW.

19. Responsibilities - Individual
Manage and supervise the day-to-day HCBS activities of Direct Support Worker(s)
Verify time worked by Direct Support Worker(s) was delivered according to the POC; approve and sign timesheets
Assure submission of Direct Support Worker timesheets and all other required documents to the FMS provider for processing and payment
Report work-related injuries incurred by Direct Support Worker(s) to the FMS
Develop an emergency worker back-up plan
Timesheets must be reflective of actual hours worked in accordance with the approved CSW and POC.
Back up plan is for in case a substitute Direct Support Worker is ever needed on short notice or as a back-up (short-term replacement worker).

20. Responsibilities - Individual
Assure all appropriate service documentation is recorded
Inform the FMS provider of any changes in the status of Direct Support Worker(s)
Inform the FMS provider and Targeted Case Manager of the dismissal of a Direct Support Worker within 3 working days
Inform the FMS provider and Targeted Case Manager of any changes in the status of the individual or individual’s representative, within 3 working days
Participate in required quality assurance visits
Changes - such as address or telephone number, in a timely fashion.
Quality checks - with Targeted Case Managers, and State Quality Assurance Staff, or other appropriate and authorized reviewers / auditors.

21. Responsibilities – FMS
When an individual or individual’s representative chooses an FMS provider, they must be fully informed by the FMS provider of their rights and responsibilities to:
Choose and direct support services,
Choose and direct the workers who provide the services,
Perform the roles and responsibilities as employer,
Understand the roles and responsibilities of the FMS provider, and;
Receive initial and ongoing skills training as requested.
Switch gears to review FMS responsibilities.

22. Responsibilities – FMS
Must negotiate, review, and sign a FMS Service Agreement
The FMS Service Agreement will identify the “negotiated” role / responsibilities of both the individual and the FMS provider.
Comply with the provisions of KSA 39-7,100 [Home and community based services program] and KSA [Individuals in need of in- home care; definitions].

23. Responsibilities – FMS
Execute a SRS/KDOA Provider Agreement with the appropriate State agency.
Execute a Medicaid Provider Agreement with State Medicaid Agency.
Comply with State Regulations, Provider Agreement requirements, policies, and procedures
The SRS/KDOA agreement will be with both agencies if doing both SRS and FE waivers. Agreement would be only with SRS if only doing SRS waivers and only with KDOA if only doing FE waiver.

24. Responsibilities – FMS
Develop and implement procedures, internal controls and other safeguards to ensure individuals or an individual’s representative, rather than the FMS provider, have the right to choose, direct, and control services and the Direct Support Worker(s).
Must include at a minimum the information on the following three slides.

25. Responsibilities – FMS
The procedures, internal controls and other safeguards must be written and include, at a minimum:
A mechanism to process Direct Support Worker human resource documentation and payroll in a manner that is efficient and supports individuals or the individual’s representatives’ authority to select, recruit, hire, manage, dismiss, and train Direct Support Workers.
Information for Direct Support Worker that outlines completion of timesheets, wages, benefits, pay days, work hours, and individual self- direct customer preferences.

26. Responsibilities – FMS
An assurance that the individual or individual’s representative, and not the FMS provider, determines the terms and conditions of work (when and how the services are provided, such as establishing work schedules, determining the conditions of work, and the tasks to be performed).
Internal controls to ensure individuals or individual’s representative are afforded choice and control over workers without excessive restrictions or barriers.
Conditions of work, for example, no smoking in the home, conditions under which a worker might be dismissed from working with the individual or individual’s representative.

27. Responsibilities – FMS
A process to respond, within a reasonable timeframe, to contact from any individual or individual’s representative informing the FMS provider of the decision to dismiss a particular Direct Support Worker.
A process for individuals or the individual’s representative to pay the Direct Support Worker(s) by direct deposit, first class mailing, or other means through the FMS

28. Responsibilities – FMS
Ensure the individual or individual’s representative and the TCM have the name and contact information of FMS provider agency staff who can address issues.
Assume responsibilities in providing the following administrative services:
Establish and maintain all required records and documentation, including a file for each self- directing individual. All files must be maintained in a confidential, HIPAA compliant manner.

29. Responsibilities – FMS
Obtain authorizations to conduct criminal background checks, child abuse and adult registry checks in accordance with applicable waiver requirements.
Verify citizen and legal status of potential Direct Support Workers.
Collect and process all required federal, state, and local human resource forms required for employment and the production of payroll.
Help individuals or the individual’s representative set the correct pay rate for each Direct Support Worker.
Collect and process timesheets of Direct Support Worker(s).
Criminal record checks continue to not required for the FE waiver but rather done upon the customers request.

30. Responsibilities – FMS
Compute, withhold, file and deposit federal, state, and local employment taxes for Direct Support Worker(s).
Compute and pay Workers Compensation as contractually and statutorily required.
Approve and pay wages to Direct Support Worker(s) in compliance with federal and state labor laws.
Perform all end-of-year federal, state, and local wage and tax filing requirements, as applicable.
End of year tax filing - IRS forms W-2 and W-3, state income tax forms and reporting.

31. Responsibilities – FMS
Have policies and procedures in place for the reporting of fraud and abuse, neglect, or exploitation by a Direct Support Worker, to the appropriate authority and
Informs the individual or individuals representative that if the Direct Support Worker continues to work for the individual that they will no longer be able to serve as the FMS provider.

32. Responsibilities – FMS
Ensure that each self-directing individual;
Maintains control and oversight of their Direct Support Worker;
Is made aware of the benefits/services available to them;
Is made aware of the requirements/responsibilities of self-directing individual to the FMS provider;
Is made aware of the requirements/responsibilities of the self-directing individual to the Direct Support Workers:
In language/format that is understandable to the individual;
Signed Employment Service agreement that specifies the responsibilities of the parties.

33. Responsibilities – FMS
Ensure each Direct Support Worker hired by the individual:
Is made aware of the benefits/services available to them;
Is made aware of the employment requirements/and job responsibilities of:
The self-directing individual;
The FMS provider
Maintain a listing of Direct Support Workers that are available and desire additional employment.
Important for everyone to be on the same page and know who is responsible for what.

34. Responsibilities – FMS
Develop, implement and maintain an internal quality assurance program that monitors for:
Self-directed individuals satisfaction
Direct Support Worker satisfaction
Correct timesheet submission
Correct payroll distribution
Develop, implement and test an adequate backup plan that assures records are preserved, and fiscal functions are replicated in case of a natural disaster/or state of emergency.
Maintain evidence of certifications, agreements and affiliations as required by waiver or policy.
Agreements required by policy - e.g. CDDO affiliation agreements for DD services.

35. Information and Assistance (I&A)
I&A is a service within FMS that is available to provide information, including independent resources, and assist in the development of options to ensure that individuals understand the responsibilities involved with directing their services.
Practical skills training is offered to enable self-directing individuals, their families and/or representative to independently direct and manage waiver services.
The extent of the assistance furnished to the self-directing individual will be determined by the self-directing individual or individual’s representative.
Examples of skills training include providing information on recruiting and hiring personal care workers, managing workers and providing information on effective communication and problem-solving.
The extent of assistance – daily tasks performed and amount of time must still fall within the approved CSW and POC.

36. Information and Assistance (I&A)
I&A services may include the performance of activities that nominally overlap the provision of targeted case management services.
However, such overlap does not constitute duplicate provision of services.
e.g. the participation in the development of ACW’s; CSW’s; and/or other planning documents; assessments; etc.

37. Information and Assistance (I&A)
I & A services may provide assistance to the self-directed individual or individual’s representative with:
Defining goals, needs and resources, identifying and accessing services, supports and resources as they pertain to self-directed activities;
Practical self-direction management skills training (e.g., hiring, managing and terminating workers, problem solving, conflict resolution);
Recognizing and reporting critical events (e.g. fraudulent activities; abuse and etc.); and
Other areas related to managing services and supports.
Provide assistance with… soon there will be a s/d website available.

38. Information and Assistance (I&A)
I&A services may provide information to the individual or individual’s representative about:
Individual centered planning;
The range and scope of individual choices and options;
Grievance and appeals processes;
Risks and responsibilities of self-direction;
Individual rights;
Importance of ensuring Direct Support Worker’s health and safety during the course of their duties to reduce potential injuries and worker’s compensation insurance claims.
Provide information about… Reduce injuries/worker’s comp claims - This may include participation in training as directed by the self-directing individual.

39. Information and Assistance (I&A)
I&A services may provide information to the individual or individual’s representative about: (cont’d)
Reassessment and review schedules;
The importance of keeping the FMS provider and TCM informed as to current contact information and planned absences; and
Such other subjects pertinent to the participant and/or family in managing and directing services and living independently and safely in the community in the most integrated setting.
Provide information about…

40. Payment for FMS
The State of Kansas has established a “Per Member Per Month (PMPM)” payment methodology to be paid for the administrative and I&A services provided.
The administrative fee cannot reduce or cause any loss of authorized waiver services to self-directing individuals.
The FMS provider is required to bill for all provided self- direct services that are on an individual’s plan of care.
The individual client obligation, if assigned to the FMS, is a required payment to the FMS and must be applied to applicable service(s).
If an individual becomes “past due” in these obligations, a remedial payment plan will be developed in coordination with the Targeted Case Manager in order to meet past due obligations.

41. Payment for FMS
The billing/procedure code for FMS regardless of waiver program is T2040 U2
FMS is authorized only once per POC regardless of how many self-directed services are needed
Therefore, if the case opens or closes mid-month the FMS service will begin or end on the specific date with the full monthly amount
If the case transfers to another FMS provider that must occur at the start of the following month

42. FMS Rate: Accounts for the following: Unemployment Insurance
Other Insurances
Filing and paying taxes
Writing / paying checks
W-2; garnishments; other administration (criminal record checks)
Audits; reporting
Direct and indirect operating costs
Information & Assistance
Operational overhead

43. Service Rates: Accounts for the following: Workers Compensation SUTA
FUTA
FICA

44. Enrollment March – April 2011 April 2011 – ongoing Training conducted
FMS Provider Manual published
Enrollment application updated
Providers begin enrolling as FMS providers
There will be one FMS manual for the service that applies to all waiver programs. Details of the definition, enrollment qualifications will be in the FMS manual once published to the KMAP website.

45. Contact Information:
FE waiver – Krista Engel, or
MRDD waiver – Greg Wintle, or
PD waiver – Candace Cobb, or
TA waiver – Kimberly Pierson, or
TBI waiver – Michael Deegan, or

46. Thank You!!