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March 23, 2021

Legislation Proposed in the NYS Assembly Would Right the Wrongs of the Department of Health's CDPAP Fiscal Intermediary Procurement Process

On March 18, 2021, New York State Assembly member Richard Gottfried, the chair of the assembly’s Health Committee, proposed legislation changing the Consumer Directed Personal Assistance Program (CDPAP) authorization process. This legislation was proposed in response to the Department of Health’s announcement of the offerors who were selected to receive contracts with the department pursuant to Request for Offers #20039 (RFO #20039) for the provision of CDPAP fiscal intermediary services. Notably, only approximately 18 percent of those who submitted offers (68 out of 373 offerors meeting the minimum offeror qualifications) under RFO #20039 were awarded contracts.

The proposed legislation, Assembly Bill A6479, would amend Section 365-f (4-a) of the New York Social Services Law, relating to fiscal intermediary services under the CDPAP, and would take effect immediately upon implementation. If passed, the legislation would permit eligible fiscal intermediaries who have provided services during the COVID-19 emergency to continue to provide these services through April 1, 2022, and would require the department to implement a new procurement process for CDPAP contract awards.

Proposed Relief for Eligible Fiscal Intermediaries

To be eligible to continue services through April 1, 2022, fiscal intermediaries that provided services during the COVID-19 emergency must be capable of: (1) appropriately providing fiscal intermediary services; (2) performing the responsibilities of a fiscal intermediary; and (3) complying with applicable laws and regulations. Eligible fiscal intermediary service providers include, but are not limited to, service centers for independent living and organizations that were established as fiscal intermediaries prior to January 1, 2012, that have continuously provided services for eligible individuals.

A fiscal intermediary’s eligibility to continue to provide services under this proposed legislation would still be subject to lawful actions taken by the Department of Health, which include terminating fiscal intermediary contracts, or suspending or limiting rights and privileges under the contract for failure to comply with relevant statutes or regulations, or determinations of imminent danger to the public health or safety.

Proposed New Request for Offers for Fiscal Intermediaries

According to the proposed legislation, the Department of Health would be required to issue a new request for applications for contracts to provide fiscal intermediary services. Importantly, the proposed legislation would remedy many of the inconsistencies and inadequacies of the RFO #20039 procurement process.

The legislation would direct the department to score applicants incrementally, based on the criteria of the request for applications and the required services that must be performed by fiscal intermediaries. Additionally, the process would be required to ensure, to the maximum extent possible, the following:

  1. There are enough fiscal intermediaries providing services to ensure that all individuals participating in the CDPAP will be appropriately served.
  2. That geographic distribution is considered to ensure access to CDPAP services in rural and underserved areas.
  3. Cultural and language competencies that are specific to their consumer population and the available workforce are demonstrated by fiscal intermediaries.
  4. That fiscal intermediaries are able to provide timely consumer assistance, have experience serving individuals with disabilities, are able to provide consumer peer support, and have demonstrated compliance with applicable federal and state laws and regulations.

In an effort to remedy the scoring and evaluation problems identified in the process used by the department for RFO #20039, the proposed legislation also would require the department to provide applicants with the incremental scores, as well as an accompanying narrative explanation, where applicable. Additionally, the department would be required to give applicants at least 60 days to respond with evidence rebutting any poor incremental scores received, or to correct errors in the narrative explanation submitted. Finally, the proposed legislation would bar the department from denying a fiscal intermediary contract until the commissioner has evaluated the response, and contract denials would need to include a narrative describing the reason for the denial.

Significantly, however, these changes to the procurement process would not disrupt the process currently in place pursuant to RFO #20039. The department would still be permitted to grant contracts awarded to successful offerors and to reoffer contracts to previous offerors.

Final Thoughts

It remains to be seen whether Assembly Bill A6479 will be passed (the bill was read once and referred to the Committee on Health), and whether relief will be afforded to those organizations providing CDPAP fiscal intermediary services that were not awarded a contract. In the meantime, fiscal intermediaries that submitted offers and were not awarded contracts with the department should continue to preserve their rights through the bid protest process pursuant to the rules of the Office of the State Comptroller.

As the Department of Health and the New York State Legislature continue to respond to the inadequacies in RFO #20039 identified by providers, Barclay Damon will continue to monitor any changes and stand ready to assist our clients as they navigate the procurement process.

For more information, please see the full text of Assembly Bill A6479.

If you have any questions regarding the content of this alert, please contact Mary Connolly, associate, at mconnolly@barclaydamon.com; Dena DeFazio, associate, at ddefazio@barclaydamon.com; or another member of the firm’s Health & Human Services or Health Care Controversies Practice Areas.

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