It is allowable for participating CCBHCs to enter into formal agreements with Designated Collaborating Organizations (DCOs) that provide certain CCBHC services under the same requirements as the CCBHC. The CCBHC is paid a PPS rate for all CCBHC services provided by the CCBHC and its DCOs. Since the PPS rate reflects the average cost per day for all CCBHC services, the amount that the CCBHC pays to the DCO will typically be different from the PPS rate. Instead, the CCBHC payment to the DCO should reflect an objective, arm’s length estimation of fair market value of the specific service provided by the DCO. Documentation of the fair market value basis for the consideration should be retained in the CCBHC’s files. The estimation of fair market value could be based on salary surveys, fee schedules, or the historic costs to the DCO of furnishing the type of services rendered under the contract. The CCBHC and the DCO must exclude the DCO costs from the CCBHC PPS rate if those costs have already been included in the DCO’s own Medicaid cost-based rate. For example, if the DCO is also a CCBHC, the cost of those services have already been included in that CCBHC’s PPS rate.
A formal relationship is evidenced by a contract, Memorandum of Agreement (MOA), Memorandum of Understanding (MOU), or such other formal arrangements describing the parties’ mutual expectations and establishing accountability for services to be provided and funding to be sought and utilized. The formal agreement must be submitted during the certification process and must include expectations regarding:
