Governor approves fee-for-service model for Nevada early intervention services funding

The Assembly Ways and Means and Senate Finance Subcommittee on Human Services convened on April 11, 2025, to discuss critical funding and operational changes for Nevada's Early Intervention Services program. The meeting focused on the program's funding sources, service delivery models, and proposed changes to enhance efficiency and compliance with federal regulations.

The subcommittee began by outlining the current funding structure, which relies primarily on general fund appropriations, supplemented by federal Individuals with Disabilities Education Act (IDEA) Part C grant funds, Medicaid reimbursements, and private insurance. A key point of discussion was the maintenance of effort requirement associated with the federal IDEA Part C grant, which mandates that state funding levels for early intervention services must be maintained to ensure compliance.

Historically, the program operated with state staff managing all case management and service coordination. However, a shift began in the 2011-2013 biennium, allowing for a 50/50 split between state and community providers. The 2023-2025 biennium saw further changes, with the legislature approving a move to eliminate this split, thereby granting families greater flexibility in choosing service providers, contingent on available funding.

A significant change discussed was the increase in the payment rate to community providers from $565 to $794.88 per child per month, effective July 1, 2024. This new rate is designed to reflect total revenue per child served, regardless of the payer, and aims to streamline the billing process for providers.

The subcommittee also addressed the implementation of a new case management and billing system funded by federal IDEA Part C grant funds. This system is intended to enhance monitoring of billing activities and track insurance claims, ensuring that providers are held accountable for timely billing and follow-up on denied claims.

Concerns were raised regarding the current payment model, which does not incentivize community providers to seek reimbursements from Medicaid or private insurance. The agency reported that in fiscal year 2023, revenue from these sources accounted for only a small percentage of total revenue collected by community providers. The existing capitated payment model was deemed non-compliant with federal regulations, prompting the governor's recommendation to transition to a fee-for-service model. This model would require providers to bill other funding sources before receiving state payments, thereby maximizing available funding.

Additionally, the governor proposed a temporary add-on payment to support community providers in covering non-billable program support services and administrative costs. This payment would be funded through opioid settlement funds and aims to assist providers during the transition to the new payment model.

In conclusion, the meeting highlighted significant changes to Nevada's Early Intervention Services program, focusing on improving funding efficiency and compliance with federal regulations. The proposed adjustments aim to enhance service delivery for families while ensuring that state and federal funds are utilized effectively. The subcommittee's discussions will inform future legislative actions and budget considerations as they move forward.