Wage Parity Certifications are on the Horizon How to Best Prepare

Our firm has received numerous questions over the last several days as the June 1, 2022 deadline for wage parity compliance certification approaches. This year will be the first time that providers will be submitting documentation evidencing their compliance with the wage parity law. Here are some FAQs that we have received from clients on this topic:

Why are Plans Asking us for Compliance Information Now? Isn’t Our Deadline to Provide this Information June 1, 2022?

Providers and payors have different obligations insofar as this year’s certifications are concerned. The providers (i.e., LHCSAs and FIs) must produce LS300, LS301 forms, and any supporting documentation to each payor with which they do business, at some point in time before June 1, 2022. The deadline by which this information must be submitted to the payors will be set by the payor, but it will be some date before June 1, 2022. The providers will also have to certify to compliance online. Conversely, payors (e.g., CHHAs and MLTCs) need to evaluate the compliance of the providers that they contract with and certify to those providers’ compliance with wage parity by June 1, 2022. The reason that payors will be requesting providers’ wage parity information now versus later is because payors need time to review the providers’ data and be in a position to certify to those providers’ compliance by June 1.

What are Plans Going to do with the Wage Parity Information Received from Providers?

Payors are required to report any “reasonably suspected” violations of the wage parity law to the New York Department of Labor (“DOL”). The State, without resources to adequately audit and monitor providers’ compliance with the Wage Parity Law requirements, has effectively outsourced this function to the payors. Home care providers and FIs are advised to carefully prepare their LS300 and LS301 forms, in order to avoid triggering any referral of their agency to the DOL. In view of the immense responsibility for verifying wage parity compliance that has been delegated to the payors by the State, payors may be inclined to take the “better safe rather than sorry” approach and over-report providers that they suspect of noncompliance.

Who can serve as an Independent Auditor?

Providers’ wage parity hours and expenditures have to be audited and the providers’ compliance has to be certified by an independent auditor. The term “independent” is defined by “GAAP according to Financial Accounting Standards Board (FASB).” The provider does not define what “independent” means. The independent auditor that has to sign off on the LS301 has to certify that they are in fact independent.

How many LS300s do we need to fill out?

Providers must complete a single LS300 for every plan that they contract with.

For entities that are both a FI and a LHCSA under one EIN, the hours and payments reported will be aggregated in a single LS300 per plan.

Providers are advised to seek counsel about how to report benefits on a per-plan basis. Benefits are accrued based on all hours worked, regardless of what plan’s hours were worked. Thus, providers have no clear way of separating out, for example, PTO that was earned under hours worked for plan ABC versus plan XYZ.

Are Overtime Hours and Spending Reported?

It is our position that overtime hours and spending are reported, since overtime hours are also considered wage parity hours. Thus, providers will report overtime pay under wages paid, and under overtime hours of care.

How Should Providers Separate out “Universal” Benefit Programs for Purposes of Reporting?

This is a bigger topic than this blog allows. Benefits that are governed by the Internal Revenue Code are generally required to be maintained separately, as each benefit is subject to its own rules on accruals, usage, forfeiture, annual limits, etc. Comingling benefits is generally not allowed. Benefit programs that are structured improperly carry the risk of losing their nontaxable status, which means that the NYS Department of Taxation or the IRS could claim that payroll tax should have been paid on those benefits. And from a wage parity standpoint, the Wage Parity Law reporting requires that each benefit’s spending be separately reported as its own “line item.” Comingling transit benefits with prescription coverage, for example, prevents the provider from reporting how much was spent by the provider per benefit.

LHCSA RFO Scheduled for Implementation on May 1, 2022 Is your Agency Ready for the RFO?

Recently, the New York State Department of Health published its FY 2023 “Medicaid Scorecard” that outlines various Medicaid-related initiatives for the upcoming year. Of interest to home care providers, the Scorecard was updated to state that the LHCSA RFO “re-estimate[d]” “Implementation date” will be May 1, 2022. There was no explanation of what this practically means. It is impossible for the State to issue a Request for Offers from interested LHCSA applicants, collect responses, and evaluate them all in time to implement the RFO by May 1, 2022. Thus, this May 1, 2022, might be a target date by which the State intends to issue the actual requests for proposals. We’ve been hearing for months that the actual RFO application for LHCSA is done and under legal review. The State has been steadfast that the RFO will be issued, eventually. However, if the CDPAP RFO is any indication, it will be years before the LHCSA RFO is actually implemented.

Nonetheless, the LHCSA RFO is unlikely to be repealed in this year’s budget bill. And the Executive’s proposal for MLTC RFOs evidences the State’s interest in consolidating the home care market, among providers and payors. Thus, with no immediate repeal of the LHCSA RFO in sight, LHCSA providers will have to go through the process of responding to the request for proposals.

As a reminder, per the State’s law, all LHCSA RFO responses will have to address the following categories:

  1. Licensure under Article 36 (which appears to mean that entities that wish to be licensed but that are not licensed cannot apply);
  2. The ability to appropriately serve Medicaid recipients, “as determined by the Commissioner;”
  3. Geographic distribution of LHCSAs to ensure access statewide, including in rural and underserved areas;
  4. Demonstrated cultural and language competencies specific to the population of recipients and those of the available workforce;
  5. Ability to provide timely assistance to recipients;
  6. Experience serving individuals with disabilities;
  7. Efficient and economic administration of LHCSA services; and
  8. Demonstrated compliance with all applicable federal and state laws and regulations, including wage and labor standards, compliance with EEO and anti-discrimination laws.

If you have any questions about the LHCSA RFO or wish to discuss preparation for the RFO, please do not hesitate to reach out to our firm.

NY Senator and Chair of Committee on Disabilities Introduces Bill to Repeal and Replace the CDPAP RFO

New York Senator John Mannion, the Chairman of Committee on Disabilities, has introduced a bill to repeal and replace the CDPAP RFO with a registration process for all fiscal intermediaries that are operating as of April 1, 2022. The proposed bill, if passed, would allow fiscal intermediaries that did not receive a RFO award to continue operating. Instead of complying with the RFO results, all fiscal intermediaries would instead be required to comply with the new requirements that have been proposed. Some of these new requirements in the Mannion bill include:

  1. All fiscal intermediaries would have to register with the Department of Health (“DOH”) prior to providing fiscal intermediary services. The DOH would not deny registration to an existing fiscal intermediary in good standing as of April 1, 2022.
  2. A registration would be effective for 5 years.
  3.  The fiscal intermediary would need to pay a registration fee that will not exceed $5,000.
  4.  A fiscal intermediary applying for an initial registration would require the applicant to attest to various items, including that the applicant is able to “appropriately” serve consumers, and can demonstrate compliance with all applicable laws. In addition, the fiscal intermediary would have to establish several of the factors that were used in the RFO, such as the ability to maintain a local presence and maintain and review a disaster preparedness and emergency plan, have an effective
    organizational structure with qualified administrative staff, ensure appropriate cultural and linguistic competencies to serve consumers and personal assistants, and maintain written policies and procedures.
  5.  The Commissioner would have the right to impose penalties on any fiscal intermediary that fails to comply with the registration requirements and terminate the registration of any fiscal intermediary that the Commissioner finds is endangering the welfare of the public.
  6. Registered fiscal intermediaries would be required to submit a cost report and a report listing quality measures and other data, including the number of timely processed payroll cycles, the number of accurate paychecks, the number of days to onboard a personal assistant, the total number of referrals made each month by a MCO or a LDSS, information related to social determinants of health, cultural or racial disparities or related information, and information about complaints filed with the fiscal intermediary or against the fiscal intermediary.
  7. The fiscal intermediary would be required to comply with various data privacy and security laws and report annually the direct care and administrative costs of personal assistant services.

We will keep you posted about the progression of this bill as the budget season moves to conclusion by April 1, 2022. In the meantime, clients who have questions about the implications of this proposal on their RFO award or their status as a non-RFO recipient are welcome to reach out to us.

Quarantine and Isolation Rules for Healthcare Personnel are Revised, Again

The State DOH has once again updated the isolation and quarantine requirements for healthcare staff (see here). The changes largely affect individuals who are exposed but not infected.

For infected healthcare staff, employers in “contingency” phases are required to provide five days of leave to employees, regardless of vaccination status of the employee, and employees can return to work on day 6 if they are asymptomatic or have mild-moderate symptoms.

For employees who were exposed, the DOH instructs that such healthcare personnel, if fully vaccinated (including boosted), will have no work restrictions if the agency is in a contingency phase. (Most home care providers are in that phase, but each agency should evaluate its own circumstances). If the agency is in a “normal” phase (and not in contingency), then an exposed worker can only return to work upon testing negative on days 1,5, 6 and 7 after exposure. The day of exposure is day 0. Exposed workers who are not boosted, even if they are fully vaccinated, may return to work after 7 days with a negative test, or in 10 days without testing, if the agency is in a contingency phase.

Vax or Mask Mandate Requirements Lifted, but not for Home Care

Effective Thursday, February 10, 2022, Governor Hochul lifted the “vaccinate or mask up” mandate for the majority of New York businesses. However, healthcare settings are excluded from this waiver and must continue to require their staff to mask up, regardless of vaccination status. Home care offices (and, of course, the home setting) are considered healthcare settings. If providers have any questions about these requirements, please let us know.

Congress Passes Law that would Limit Use of Confidential Arbitration to Resolve Sexual Harassment Claims

Congress yesterday passed a bill that would make pre-dispute arbitration agreements and class action waivers covering sexual assault and sexual harassment claims invalid and unenforceable. The bill is headed to President Joe Biden’s desk, and he is expected to sign it. Here, we explain the bill and implications if it becomes law.

By way of background, the bill is titled “Ending Forced Arbitration of Sexual Assault and Sexual Harassment Act of 2021” (the “Act”) and it amends the Federal Arbitration Act (FAA) to give employees who are parties to arbitration agreements with their employers the option of bringing their claims of sexual assault or sexual harassment in arbitration or in court. Employers who routinely use arbitration agreements with class action waivers to cover all claims arising out of or related to employment will
know that such waivers generally state that any sexual harassment-type claims must be resolved through individual, confidential, arbitration. The agreements, thus, generally require the employee to utilize arbitration. If enacted, the Act would allow an employee claiming harassment to avoid going through arbitration to resolve their claims. Rather, the employee would have a choice as to whether to pursue claims against their harasser in court or through arbitration.

Employee advocate groups argue that confidential arbitration proceedings limit employees’ abilities to expose abusive employers through public court proceedings. In the wake of the MeToo movement, there have been significant efforts to repeal agreements and laws that, advocates argue, allow employers to “get away with” and cover up harassment claims made against harassing managers.

States like New York have tried to make agreements mandating confidential arbitration unenforceable, but such state restrictions conflicted with the FAA and, thus, are not enforceable. The Act seeks to cure that conflict between the FAA and state laws.

The Act adds a section to the FAA that states, “[A]t the election of the person alleging conduct constituting a sexual harassment dispute or a sexual assault dispute …. no pre-dispute arbitration agreement or pre-dispute joint-action waiver shall be valid or enforceable with respect to a case which is filed under Federal, Tribal, or State law and relates to the sexual assault dispute or the sexual harassment dispute.”

The Act defines “sexual assault dispute” as “a dispute involving a nonconsensual sexual act or sexual contact” and “sexual harassment dispute” as “a dispute relating to conduct that is alleged to constitute sexual harassment under applicable Federal, Tribal, or State law.” The term “joint-action” waiver includes class and collective action waivers.

The Act further provides that the validity or enforceability of an agreement will be determined by a court rather than an arbitrator, despite the existence of a contractual term to the contrary. Finally, the Act states that it shall apply with respect to any dispute or claim that arises or accrues on or after the date of the Act’s enactment.

Takeaways for Employers
As enacted, the Act seems to apply only to claims that relate to sexual harassment or assault claims, meaning that other types of claims (e.g., wage and hour) could continue to be arbitrated, and that class action waivers of those claims would continue to be valid. Employers should not abandon arbitration agreements with class action waivers as a result of the Act’s anticipated passage.

Employers with arbitration agreements should anticipate more sexual assault and sexual harassment claims being filed in court, rather than arbitration. Employees will likely choose to pursue their sexual harassment claims in a public forum like the courts, in order to exert pressure on the employer to settle early on. While arbitration is not entirely confidential, it is inherently more confidential than litigation in court because of the absence of a public record. However, the new law makes clear that, with respect to
sexual assault and sexual harassment claims, it is up to the employee, not the employer, to decide whether the case is tried in court or in arbitration, regardless of what an arbitration agreement says.

As always, employers should implement risk mitigation efforts aimed at reducing their exposure to harassment claims, including sexual harassment claims. The likely passage of this Act will only raise the stakes for employers who are sued for alleged harassment.

Changes to Independent Assessor Procedures Postponed until May 1

By way of background, in 2020, the State amended the law to authorize the New York Department of Health (“DOH”) to contract with one entity to conduct independent assessments for individuals seeking personal care services, either in a LHCSA or a CDPAP setting. Subsequently, New York´s regulations were amended to require that individuals seeking these services under the Medicaid State Plan (including those individuals under the MLTC program) obtain an independent assessment and be evaluated and have a Medical Review and Practitioner´s Order form completed by an independent clinician that does not have a prior relationship with the individual seeking services. The State has contracted with Maximus Health Services, Inc. (“Maximus”) to perform the foregoing independent assessments. Upon full implementation of these amendments, the independent assessor (through Maximums) will conduct all initial assessments and all routine and non-routine reassessments for individuals seeking personal care.

The foregoing changes to the independent assessment have been postponed now until May 1. In view of significant opposition to this independent assessor process, there is some possibility of the State repealing the law, but that is not yet certain.

No-Hire Agreements are a No Go

Last week, a grand jury indicted four managers of home health care agencies for allegedly conspiring to “suppress wages and restrict the job mobility of” essential workers. The indictment alleges that the four individuals conspired to eliminate competition for the services of personal support specialists (i.e., aides) by agreeing to fix the rates paid to the workers and by agreeing not to hire each other’s aides. The indictment alleges that, among other actions, the individuals “participated in conversations and communications regarding MaineCare’s rate increases,” including communications “using an encrypted messaging app,” attended virtual and in-person meetings and “engaged in discussions to collectively fix the hourly rates for workers and refrain from hiring each other’s workers, and exchanged a series of group messages agreeing to fix rates at $15 per hour for workers. The indictment follows on the heels of a statement by a representative of the U.S. Department of Justice (“DOJ”), announcing that the DOJ will continue to “target [] excessive concentration and abuses by employers in labor markets.”

In a tight market, employers that are considering pacts or agreements with other employers whereby each employer abstains from hiring the other employer’s workers are not uncommon. Indeed, the New York State Attorney General is investigating certain healthcare employers under this theory of violations. Employers should speak with counsel before entertaining or entering into these types of agreements, whether they are written or unwritten agreements.

Telephone and Video Nursing Supervision Visits Allowed to Continue for LHCSAs

Recently, Governor Hochul extended an Executive Order that has been providing waivers from certain regulatory requirements for LHCSAs. Specifically, as relevant to home care, the Executive Order allows:

  • Initial patient visits for CHHAs to be made within 48 hours of receipt and acceptance of a community referral or return home from institutional placement;
  • CHHAs and LHCSAs to conduct in-home supervision of aides as soon as practicable after the initial service visit, or to permit in-person and in-home supervision to be conducted through indirect means, including by telephone or video communication; and
  • Nursing supervision visits for personal care services to be made as soon as practicable

This Executive Order is effective until March 1, 2022.

NYS DOH Publishes Self-Attestations for COVID-19 Sick Leave Eligibility

The State Department of Health (DOH) has published on its website self-attesting quarantine and isolation forms that employees may use to demonstrate eligibility for the State’s COVID-19 COVID sick leave pay.

As we have discussed in prior articles, the New York State COVID Sick Leave Law requires employers to provide paid leave for employees who are subject to a mandatory or precautionary order of quarantine or isolation, as well as for employees caring for a minor or dependent child who is required to quarantine. The law requires employees to be subject to “an order” of quarantine or isolation issued by the State of New York, a state or local health department, or any other governmental entity. In issuing the self-attestation forms, the DOH intends for employers to recognize the attestation as if a governmental entity has issued it for purposes of the COVID sick leave pay. Indeed, the Isolation form, for example, specifically states that “This form may be used for Isolation Release or for New York Paid Family Leave COVID-19 claims as if it was an individual Order for Isolation issued by the New York State Department of Health or relevant County’s Commissioner of Health or designee.”

However, the COVID sick leave law itself never contemplated a self-attesting form, even one that is on a government template. The law, as originally enacted, intended for a government entity to certify to an employee’s need for isolation or quarantine. As we have seen over the course of the pandemic, local departments of health (e.g., Nassau County, Onondaga County) and other governmental entities (e.g., NYC) have turned to self-attestation forms in view of practical challenges in issuing individualized quarantine or isolation orders to thousands of individuals per day. The State DOH’s own form now follows those local efforts.

Employers who have been inundated with requests for paid COVID sick leave should carefully consider whether to recognize self-attesting forms for purposes of paid COVID sick leave. While infected or exposed employees should be provided with the necessary time off from work, the question of who pays for that time off is a separate issue. As we have discussed in the past, COVID sick leave is an independent standalone sick leave benefit that must be paid out to an isolating or quarantining employee, and the employer cannot utilize the employee’s vacation or other PTO accruals for COVID sick leave.

If you have any questions about paid time off requirements related to employees who have been exposed or who are infected with COVID, please let us know.