AZTAC
160 S. Progress Avenue, Suite 1-A, Harrisburg, PA 17109
Phone: 717-671-4602 FAX: 717-671-4604
What is Rate Setting?

Rate Setting for Consolidated and P/FDS Waiver Programs:

Rate setting was the process which counties, administrative entities and provider agencies were required to use to calculate in advance the individualized rates they will charge for providing services to individuals and reimbursing the provider at that rate based on the actual number of units used.  Through the use of Rate Setting the Office of Development Programs moved from "program funding" of services to paying for services that are actually delivered based on prospective rates.  By doing this, funding is committed to the consumer's individual budget (available to support consumer and family choices) and not to the particular provider.  This change was to  increase the opportunity of  choice for consumers (to choose another service provider that better meets their needs) but it also increased the financial risk of the providers (they can no longer rely on "Program Funding" to support their budgets.)

"Ratesetting forms" were required by ODP in FY 2005-06, FY 2006-07, and FY 2007-08.   This process was discontinued.   In FY 2007-2008, providers were required to submit cost reports, which were used to calculate rates for FY 2009-2010.  Similarly, providers were required to submit FY 2008-09 cost reports, which were the basis for FY 2010-11 rates, and and so forth, with each cost report becoming the basis of rates two years later.   This process was also discontinued. 

Beginning July 1, 2017, some services, including residential ineligible services, were moved to Department-set rates, or "fee schedule."  Effective January 1, 2018, all residential programs eligible services were moved to the Department-set rates, fee schedule.