Division of Rate Setting

What We Do

The Division of Rate Setting (DRS) calculates and certifies Medicaid rates for residential services provided to Vermonters by 34 Vermont nursing homes, out-of-state nursing homes, 14 residential facilities for youth called Private Non-Medical Institutions (PNMIs), the Intermediate Care Facility for the Developmentally Disabled (ICF/DD), and hospital swing bed rates.  The Division’s rules govern the processes for setting the Medicaid rates of each different type of facility.

Who We Serve

The Division of Rate Setting serves the providers for which it sets rates as well as the approximately 1,700 nursing home and ICF/DD Medicaid residents and 140 PNMI residents.  DRS is also a resource to DVHA and other departments within the Agency of Human Services, State of Vermont, and external stakeholders, providing census and financial data as well as analysis used to formulate budgets, establish policy and examine trends within the industry.

How We Impact

The Division plays a crucial role in supporting a stable system of long-term care in Vermont by setting cost-based rates, pursuant to the Division’s rules, that allow for a high degree of predictability to providers while ensuring the resources necessary to supply high quality care Vermonters.  The Division’s work removing unallowable cost reimbursements from Medicaid rates has saved the State millions of dollars over the years.  The Division also works with the Attorney General’s Office to recoup fraudulent payments.


The top 2 priorities for the DRS in SFY2020 are:

  • To update the nursing home and PNMI rules, policies and procedures to ensure that they reflect current CMS regulations and align with current priorities.
  • To work towards transitioning nursing facilities from a prospective case mix reimbursement system known as RUG-IV to the recently adopted CMS patient-driven payment model (PDPM).   
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