Current through Register Vol. 50, No. 9, March 1, 2024
RELATES TO:
KRS
142.361,
142.363,
216.380,
42 C.F.R. Parts
430,
431,
432,
433,
435,
440,
441,
442,
447,
455,
456,
482.58,
483.10,
42 U.S.C.
1395tt,
1396,
1396a,
1396b,
1396c,
1396d,
1396g,
1396l,
1396n,
1396o,
1396p,
1396r,
1396r-2,
1396r-5
NECESSITY, FUNCTION, AND CONFORMITY: The Cabinet for Health and
Family Services, Department for Medicaid Services, has responsibility to
administer the Medicaid program.
KRS
205.520(3) authorizes the
cabinet, by administrative regulation, to comply with any requirement that may
be imposed, or opportunity presented, by federal law for the provision of
medical assistance to Kentucky's indigent citizenry. This administrative
regulation establishes the method for determining amounts payable by the
Medicaid program for services provided by a price-based nursing
facility.
Section 1. Definitions.
(1) "Ancillary service" means a direct
service for which a charge is customarily billed separately from the per diem
rate including:
(a) Ancillary services
pursuant to
907 KAR 1:023; or
(b) If ordered by a physician:
1. Laboratory procedures; or
2. X-rays.
(2) "Appraisal" means an evaluation of a
price-based nursing facility building, excluding equipment and land, conducted
by the department in accordance with Section 4 of this administrative
regulation for the purpose of calculating the depreciated replacement cost of a
price-based nursing facility.
(3)
"Appraisal base year" means a year in which the department conducts an
appraisal of each price-based NF.
(4) "Auxiliary building" means a roofed and
walled structure:
(a) Serviced by electricity,
heating, and cooling;
(b)
Independent of an NF;
(c) Used for
administrative or business purposes related to an NF; and
(d) Constructed on the same tract of ground
as an NF.
(5) "Capital
rate component" means a calculated per diem amount for an NF based on:
(a) The NF's appraised depreciated
replacement cost;
(b) A value for
land;
(c) A value for
equipment;
(d) A rate of
return;
(e) A risk
factor;
(f) The number of calendar
days in the NF's cost report year;
(g) The number of licensed NF beds in the NF;
and
(h) The NF's bed occupancy
percentage.
(6)
"Case-mix" means the time-weighted average price-based NF acuity for
Medicaid-eligible and dual-eligible Medicare and Medicaid residents under a
Medicare Part A reimbursed stay in a price-based nursing facility, and is based
on Minimum Data Set (MDS) 3.0 data classified through the RUG III, M3 p1,
(version 5.20) thirty-four (34) group model resident classification system or
equivalent.
(7) "Core based
statistical area" or "CBSA" means the designation of metropolitan and
micropolitan population centers based on the national census, as published by
the Federal Office of Management and Budget.
(8) "Department" means the Department for
Medicaid Services or its designee.
(9) "Equipment" means a depreciable tangible
asset, other than land or a building, which is used in the provision of care
for a resident by an NF staff person.
(10) "Governmental entity" means a unit of
government for the purposes of
42 U.S.C.
1396b(w)(6)(A).
(11) "Hospital-based NF" means an NF that:
(a) Is separately identifiable as a distinct
part of the hospital; and
(b) If
separated into multiple but distinct parts of a single hospital, is combined
under one (1) provider number.
(12) "Land" means a surveyed tract or tracts
of ground that share a common boundary:
(a) As
recorded in a county government office;
(b) Upon which a building licensed as an NF
is constructed; and
(c) Including
site preparation and improvements.
(13) "Local unit of government" means a city,
county, special purpose district, or other governmental unit in the
state.
(14) "NF" or "nursing
facility" means:
(a) A facility:
1. To which the state survey agency has
granted an NF license;
2. For which
the state survey agency has recommended to the department certification as a
Medicaid provider; and
3. To which
the department has granted certification for Medicaid participation;
or
(b) A hospital swing
bed that provides services in accordance with
42 U.S.C.
1395tt and
1396l, if the swing bed is
certified to the department as meeting requirements for the provision of swing
bed services in accordance with
42 U.S.C.
1396r(b), (c), (d),
42 C.F.R.
447.280, and
482.58.
(15) "NF building" means a roofed and walled
structure serviced by electricity, heating, and cooling and that is also an
NF.
(16) "Nursing facility with
Medicaid waiver" or "NF-W" means an NF to which the state survey agency has
granted a waiver of the nursing staff requirement.
(17) "Provider assessment" means the
assessment imposed by
KRS
142.361 and
142.363.
(18) "Routine services" means the services
covered by the Medicaid program pursuant to
42 C.F.R.
483.10(f)(11)(i).
(19) "Site improvement" means a depreciable
asset element, other than an NF building or auxiliary building, on NF land
extending beyond an NF's foundation if used for NF-related purposes.
(20) "Standard price" means a
facility-specific reimbursement that includes a case-mix adjusted component,
noncase-mix adjusted component including an allowance to offset a provider
assessment, noncapital-facility related component, and capital rate
component.
(21) "State survey
agency" means the Cabinet for Health and Family Services, Office of Inspector
General, Division of Health Care.
(22) "Time-weighted" means a method of
calculating case-mix by determining the number of days that a minimum data set
(MDS) record is active over a calendar quarter rather than captured from a
single day during the calendar quarter.
Section 2. NF Reimbursement Classifications
and Criteria.
(1) An NF or a hospital-based NF
shall be reimbursed as a price-based NF pursuant to this administrative
regulation if:
(a) It provides NF services to
an individual who:
1. Is a Medicaid
recipient;
2. Meets the NF patient
status criteria pursuant to
907 KAR 1:022; and
3. Occupies a Medicaid-certified bed;
and
(b)
1. It has more than ten (10) NF beds and the
greater of:
a. Ten (10) of its
Medicaid-certified beds participate in the Medicare program; or
b. Twenty (20) percent of its Medicaid
certified beds participate in the Medicare program; or
2. It has less than ten (10) NF beds and all
of its NF beds participate in the Medicare program.
(2) An NF-W shall be reimbursed as
a price-based NF pursuant to this administrative regulation if it meets the
criteria established in subsection (1)(a) of this section.
(3) The following shall not be reimbursed as
a price-based NF and shall be reimbursed pursuant to
907 KAR 1:025:
(a) An NF with a certified brain injury
unit;
(b) An NF with a distinct
part ventilator unit;
(c) An NF
designated as an institution for mental disease;
(d) A dually-licensed pediatric facility;
or
(e) An intermediate care
facility for individuals with an intellectual disability.
Section 3. Reimbursement for
Federally-Defined Swing Beds and for Skilled Nursing Facility Services in
Critical Access Hospital Swing Beds.
(1) The
reimbursement rate for a federally-defined swing bed shall be:
(a) The average rate per patient day paid to
freestanding price-based NFs for routine services furnished during the
preceding calendar year, excluding any payment made pursuant to Section 14 of
this administrative regulation; and
(b) Established effective January 1 of each
year.
(2)
(a) The department shall reimburse a critical
access hospital for skilled nursing facility services in a swing bed at the
same rate as established by the Centers for Medicare and Medicaid Services for
Medicare.
(b) The department shall
pay an interim per diem rate as established by CMS for the Medicare
program.
(c) The effective date of
a rate shall be the same as used by the Medicare program.
(d) A critical access hospital's final
reimbursement for skilled nursing facility services in a swing bed shall
reflect any adjustment made by the Centers for Medicare and Medicaid
Services.
(e) Total payments made
to a critical access hospital for skilled nursing facility services provided in
a swing bed under this section shall be subject to the payment limitation
established in 42 C.F.R.
447.271.
(f) The provisions established in this
subsection shall apply to a critical access hospital that complies with all
requirements established in
KRS
216.380.
Section 4. Price-based NF Appraisal.
(1) The department shall appraise a
price-based NF to determine the facility specific capital component in 2009,
and every fifth year, in order to calculate the NF's depreciated replacement
cost.
(2) The department shall not
appraise equipment or land. A provider shall be given the following values for
land and equipment:
(a) Ten (10) percent of an
NF's average licensed bed value for land; and
(b) $2,000 per licensed NF bed for
equipment.
(3) The
department shall utilize the following variables and fields of the nursing home
or convalescent center model of the Marshall & Swift Boeckh Building
Valuation System (BVS) to appraise an NF identified in Section 2(1) of this
administrative regulation:
(a) Provider
number;
(b) Property owner - NF
name;
(c) Address;
(d) Zip code;
(e) Section number - the lowest number shall
be assigned to the oldest section and a basement, appraised as a separate
section, immediately follows the section it is beneath;
(f) Occupancy code - nursing home or
substructure;
(g) Average story
height;
(h) Construction
type;
(i) Number of
stories;
(j) Gross floor area
(which shall be the determination of the exterior dimensions of all interior
areas including stairwells of each floor, specifically excluding outdoor
patios, covered walkways, carports, and similar areas). In addition, interior
square footage measurements shall be reported for:
1. A non-NF area;
2. A shared service area by type of service;
and
3. A revenue-generating
area;
(k) Gross
perimeter (common walls between sections shall be excluded from both
sections);
(l) Construction
quality;
(m) Year built;
(n) Building effective age;
(o) Building condition;
(p) Depreciation percent;
(q) Exterior wall material;
(r) Roof covering material and roof
pitch;
(s) Heating
system;
(t) Cooling
system;
(u) Floor finish;
(v) Ceiling finish;
(w) Partition wall structure and
finish;
(x) Passenger and freight
elevators - actual number;
(y) Fire
protection system (sprinklers, manual fire alarms, and automatic fire
detection) - percent of gross area served. If both the floor and attic areas
are protected by a sprinkler system or automatic detection, the percent of
gross area served shall be twice the floor area; and
(z) Miscellaneous additional features, which
shall be limited to:
1. Canopies;
2. Entry foyers (sheltered entry ways):
a. The glass and aluminum standard allowance
shall be thirty (30) dollars per square foot;
b. Bulkhead standard allowance shall be:
(i) Seven (7) dollars per square foot for a
wood frame;
(ii) Eight (8) dollars
per square foot for a steel frame; or
(iii) Twenty (20) dollars per square foot for
brick masonry;
3. Loading docks;
4. Code alerts, Wanderguards, or other
special electronically-secured doorways, except for a door with a sound
detector or sensing unit (the standard allowance shall be $1,500 for each
fully-functioning door at the time of appraisal);
5. A door with a sound detector or sensing
unit shall have a standard allowance of $500 per door;
6. Automatic sliding doors (the standard
allowance shall be $17,000 per doorway);
7. An automatic door opener shall have a
standard allowance of $6,500 per door;
8. Detached garages or storage sheds (which
shall have an attached reinforced concrete floor and a minimum of 200 square
feet);
9. Modular buildings or
trailers, if the structure has a minimum of 200 square feet, electrical
service, and heating or cooling services (the standard allowance shall be
fifty-six (56) dollars per square foot);
10. Walk-in coolers or freezers;
11. Laundry chutes (the standard allowance
shall be $2,100 per floor serviced);
12. Dumb waiters (which shall have a minimum
speed of fifty (50) feet per minute. The standard allowance shall be $8,000 for
the initial two (2) stops for a manual door or $21,000 for the initial two (2)
stops for an electric door and $7,000 per additional stop);
13. Skylights (the standard allowance shall
be forty (40) dollars per square foot);
14. Operable built-in oxygen delivery systems
(valued at $300 per serviced bed);
15. Carpeted wainscoting (the standard
allowance shall be sixty (60) dollars per licensed bed);
16. Balconies;
17. Ceiling fans for which the standard
allowance shall be $250 for each ceiling fan without a light and $400 for each
ceiling fan with a light;
18.
Cupolas for which the standard allowance shall be $720 each;
19. Fireplaces;
20. Concrete-lined utility tunnels for which
the standard allowance shall be twenty-five (25) dollars per cubic foot;
and
21. Mechanical
penthouses.
(4) An item listed in subsection (3)(z) of
this section shall be subject to the Marshall & Swift Boeckh BVS model
#5200 monetary limit unless a monetary limit is provided for that item in
subsection (3)(z) of this section.
(5) The department shall use the
corresponding Marshall & Swift Boeckh BVS default value for any variable
listed in subsection (3) of this section if no other value is stated for that
variable in subsection (3) of this section.
(6)
(a)
Values from the most recent Marshall & Swift Boeckh BVS tables shall be
used during an appraisal.
(b) An
adjustment calculation shall be performed if the most recent Marshall &
Swift Boeckh BVS tables do not correspond to an appraisal base year.
(7) In addition to an appraisal
cited in subsection (1) of this section, the department shall appraise an NF
identified in Section 2(1) of this administrative regulation if:
(a) The NF submits written proof of
construction costs to the department; and
(b)
1. The
NF undergoes renovations or additions costing a minimum of $150,000 and the NF
has more than sixty (60) licensed beds; or
2. The NF undergoes renovations or additions
costing a minimum of $75,000 and the NF has sixty (60) or fewer licensed
beds.
(8) An
auxiliary building shall be:
(a) Appraised if
it rests on land, as defined in Section 1(12) of this administrative
regulation; and
(b) Appraised
separately from an NF building.
(9) To appraise an auxiliary building, the
department shall utilize a Marshall & Swift Boeckh BVS model other than the
nursing home or convalescent center #5200 model, if the model better fits the
auxiliary building's use and type.
(10) If an NF building has beds licensed for
non-NF purposes or a provider conducts business activities not related to the
NF, the appraisal shall be adjusted between NF and non-NF activity. The
appraiser shall determine if the adjustment shall be made by dividing the
number of licensed NF beds by the total number of beds, or through the use of
an adjustment factor determined in accordance with appraisal industry standards
by the appraiser, regardless of the occupancy factor. For example, an
adjustment factor may be used to apportion the appraisal by the percent of NF
square footage relative to the square footage on non-NF-related business
activities.
(11) Cost of an
appraisal shall be the responsibility of the NF being appraised.
(12) A building held for investment, future
expansion, or speculation shall not be considered for appraisal
purposes.
(13) The department shall
not consider the following location factors in rendering an appraisal:
(a) Climate;
(b) High-wind zone;
(c) Degree of slope;
(d) Position;
(e) Accessibility; or
(f) Soil condition.
Section 5. Standard Price
Overview.
(1) Rates shall reflect the
differential in wages, property values, and cost of doing business in rural and
urban designated areas.
(2)
(a) Except as provided by paragraph (b) of
this subsection, and beginning in 2018, on July 1 of each year, the department
shall utilize the most recent Federal Office of Management and Budget's core
based statistical area (CBSA) designations to classify an NF as being in an
urban or rural area, with metropolitan areas always being classified as urban.
The urban and rural designations shall be based on the location of the NF under
the CBSA designation.
(b)
1. On July 7, 2017, the department shall
utilize the most recent Federal Office of Management and Budget's core based
statistical area (CBSA) designations to classify an NF as being in an urban or
rural area, with metropolitan areas classified as urban. The urban and rural
designations shall be based on the location of the NF under the CBSA
designation.
2. On July 7, 2017, a
change in designation from:
a. Rural to urban
shall take effect on July 1, 2017; and
b. Urban to rural shall take effect July 1,
2018.
(3) The department shall utilize an analysis
of fair-market pricing and historical cost for the following data:
(a) Staffing ratios;
(b) Wage rates;
(c) Cost of administration, food,
professional support, consultation, and nonpersonnel operating expenses as a
percentage of total cost;
(d)
Fringe benefit levels;
(e) Capital
rate component; and
(f) Noncapital
facility-related component.
(4) The following components shall comprise
the case-mix adjustable portion of an NF's standard price:
(a) The personnel cost of:
1. A director of nursing;
2. A registered nurse (RN);
3. A licensed practical nurse
(LPN);
4. A nurse aide;
5. An activities staff person; and
6. A medical records staff person;
and
(b) Nonpersonnel
operating cost including:
1. Medical supplies;
and
2. Activity supplies.
(5) The following
components shall comprise the noncase-mix adjustable portion of an NF's
standard price:
(a) Administration to include
an allowance to offset a provider assessment;
(b) Nondirect care personnel;
(c) Food;
(d) Professional support; and
(e) Consultation.
(6) The following components shall comprise
the facility and capital component of an NF's standard price:
(a) The noncapital facility-related
component, which shall be a fixed, uniform amount for all price-based NFs;
and
(b) The NF's capital rate
component, which shall be facility specific.
(7) Excluding capital rate components, the
following is an example of an urban and a rural price-based NF's standard price
based on rebased wages at the 2008 level:
CBSA |
Case-Mix Adjustable |
Noncase-Mix Adjustable Portion of Standard
Price |
Total Standard Price Excluding |
Designation |
Portion of Standard Price |
Without Capital Rate Component |
Capital Rate Components |
Urban |
$88.05 |
$62.80 |
$150.85 |
Rural |
$74.62 |
$55.63 |
$130.25 |
(8) A
price-based NF's standard price shall be adjusted for inflation every July 1
and rebased in 2008.
(9) Effective
July 1, 2004, an NF shall not receive a rate less than its standard
price.
(10) Effective July 1, 2022:
(a) A nursing home relief reimbursement
increase of twenty-nine (29) dollars shall be included in the noncase-mix
adjustable portion of the per diem rate.
(b) The nursing home relief reimbursement
increase shall be included in the administration line of the calculation and
shall not receive annual inflationary adjustments.
(c) The nursing home relief reimbursement
increase of twenty-nine (29) dollars shall continue until the standard price is
rebased.
(11) The
department shall adjust an NF's standard price if:
(a) A governmental entity imposes a mandatory
minimum wage or staffing ratio increase and the increase was not included in
the inflation adjustment; or
(b) A
new licensure requirement or new interpretation of an existing requirement by
the state survey agency results in changes that affect all facilities within
the class. The provider shall document that a cost increase occurred as a
result of a licensure requirement or policy interpretation.
Section 6. Standard
Price Calculation.
(1) Based on the
classification of urban or rural, the department shall calculate an individual
NF's standard price to be the sum of:
(a) The
case-mix adjustable portion of the NF's standard price, adjusted by the NF's
current case-mix index pursuant to Section 7 of this administrative
regulation;
(b) The noncase-mix
adjustable portion of the NF's standard price, which shall include:
1. An allowance to offset a provider
assessment; and
2. The nursing home
relief reimbursement increase of twenty-nine (29) dollars;
(c) The noncapital facility-related
component; and
(d) Pursuant to
subsection (2) of this section, the capital rate component.
(2) An NF's capital rate component
shall be calculated as follows:
(a) The
department shall add the total of:
1. The NF's
average licensed bed value, which shall:
a. Be
determined by dividing the NF's depreciated replacement cost, as determined
from an appraisal conducted in accordance with Section 4 of this administrative
regulation, by the NF's total licensed NF beds; and
b. Not exceed $56,003 effective July 1, 2016,
which shall be adjusted every July 1 thereafter by the same factor applied to
the NF's depreciated replacement cost;
2. A value for land, which shall be ten (10)
percent of the NF's average licensed NF bed value, established in accordance
with subparagraph 1. of this paragraph; and
3. A value for equipment, which shall be
$2,000 per licensed NF bed;
(b) The department shall multiply the sum of
paragraph (a) of this subsection by a rate of return factor, which shall:
1. Be equal to the sum of:
a. The yield on a twenty (20) year treasury
bond as of the first business day on or after May 31 of the most recent year;
and
b. A risk factor of two (2)
percent; and
2. Not be
less than nine (9) percent nor exceed twelve (12) percent;
(c) The department shall determine the NF's
capital cost-per-bed day by:
1. Dividing the
NF's total patient days by the NF's available bed days to determine the NF's
occupancy percentage;
2. If the
NF's occupancy percentage is less than ninety (90) percent, multiplying ninety
(90) percent by 365 days; and
3. If
the NF's occupancy percentage exceeds ninety (90) percent, multiplying the NF's
occupancy percentage by 365 days; and
(d) The department shall divide the sum of
paragraphs (a) and (b) of this subsection by the NF's capital cost-per-bed day
established in paragraph (c) of this subsection to determine an NF's capital
rate component.
(3) If a
change of ownership occurs pursuant to
42 C.F.R.
447.253(d), the new owner
shall:
(a) Receive the capital cost rate of
the previous owner unless the NF is eligible for a reappraisal pursuant to
Section 4(7) of this administrative regulation; and
(b) File an updated provider application with
the Medicaid program pursuant to
907 KAR 1:672, Section
3(4).
(4) A new facility
shall be:
(a) Classified as a new facility if
the facility does not have a July 1, of the current state fiscal year, Medicaid
rate;
(b) Determined to be urban or
rural; and
(c) Reimbursed at its
standard price, which shall:
1. Be based on a
case-mix of 1.0;
2. Be adjusted
prospectively based upon no less than one (1) complete calendar quarter of
available MDS 3.0 data following the facility's Medicaid
certification;
3. Utilize $56,003
effective July 1, 2016, as adjusted through the current state fiscal year as
the facility's average licensed NF bed value until the facility is appraised in
accordance with Section 4 of this administrative regulation; and
4. Be adjusted, if necessary, following the
facility's appraisal if the appraisal determines the facility's average
licensed NF bed value to be less than $56,003 effective July 1, 2016, as
adjusted through the current state fiscal year.
(5) The amounts calculated pursuant to
subsection (4)(c)3. and 4. of this section shall be adjusted annually
consistent with the adjustments made to the depreciated replacement cost, as
described in subsection (2)(a)1.b. of this section for the capital component
calculation.
Section 7.
Minimum Data Set (MDS) 3.0, Resource Utilization Group (RUG) III, and
Validation.
(1) A price-based NF's Medicaid
MDS data shall be utilized to determine its case-mix index each
quarter.
(2) A price-based NF's
case-mix index shall be applied to its case-mix adjustable portion of its
standard price.
(3) To determine a
price-based NF's case-mix index, the department shall:
(a) Calculate case-mix on a time-weighted
basis using MDS data:
1. Extracted on the last
date of each calendar quarter from the NF's MDS item sets:
a. Included in Minimum Data Set (MDS) -
Version 3.0, Resident Assessment and Care Screening; and
b. Transmitted by the NF to the Centers for
Medicare and Medicaid Services; and
2. Which, if revised, shall be revised no
later than the last date of the quarter following the date on which MDS data
was extracted. For example, MDS data submitted after September 30, 2016, for
the purpose of revision to MDS data extracted June 30, 2016, shall not be
utilized;
(b) Classify
the data cited in paragraph (a) of this subsection through the RUG III, (M3
p1), version five point twenty (5.20) thirty-four (34) group or equivalent
model resident classification system; and
(c) Validate the data cited in paragraph (a)
of this subsection as follows:
1. The
department shall generate a stratified random sample of twenty-five (25)
percent of the Medicaid residents in a price-based NF;
2. The department shall review one (1) MDS
assessment from each resident in the sample referenced in subparagraph 1. of
this paragraph;
3. The department
shall review medical records corresponding to the individuals included in the
sample identified in subparagraphs 1. and 2. of this paragraph to determine if
the medical records accurately support the MDS assessments submitted for the
sample residents; and
4. If a
review of records cited in subparagraph 3. of this paragraph reveals that the
price-based NF fails to meet the minimum accuracy threshold, the department
shall determine if the NF fails to meet the minimum accuracy threshold by
reviewing 100 percent of the price-based NF's Medicaid MDS assessments:
a. Extracted in accordance with paragraph (a)
of this subsection; and
b.
Selecting one (1) MDS assessment per resident.
(4) If the department's review, in
accordance with subsection (3)(c)3. and 4. of this section, of a price-based
NF's MDS assessment data reveals that the NF fails to meet the MDS data minimum
accuracy threshold, the department shall conduct another review of the same
data utilizing an individual or individuals not involved in the initial
validation process if the price-based NF requests a reconsideration within ten
(10) business days of being notified of the findings of the review cited in
subsection (3)(c)4. of this section.
(5) Only MDS data extracted in accordance
with subsection (3)(a)2. of this section shall be allowed during a review or
reconsideration.
(6) If a
reconsideration of a price-based NF's MDS assessment data, in accordance with
subsection (4) of this section, confirms that the NF fails to meet the minimum
accuracy threshold, the department shall:
(a)
Conduct a conference with the NF to review preliminary findings of the
reconsideration; and
(b) Send the
final results of the reconsideration to the NF within ten (10) business days of
the conference.
(7) In
performing validation reviews on MDS data, the department shall:
(a) Notify the NF at the time of the MDS
assessment review of any assessment that is not validated and allow the NF to
provide supporting documentation that had been utilized to support the
assessment;
(b) Consider all MDS
supporting documentation provided by the NF prior to the exit conference;
and
(c) Not consider MDS supporting
documentation provided by the NF after the exit conference has
occurred.
(8)
(a) Reconsideration of a price-based NF's MDS
assessment data validation shall be provided if the NF:
1. Requests a reconsideration and clearly
identifies each specific resident's review and MDS elements that are being
disputed;
2. States the basis on
which the department's decision on each issue is believed to be erroneous;
and
3. Provides a summary
supporting the NF's position.
(b) After a reconsideration of a price-based
NF's MDS assessment data has been completed, the NF may appeal the department
decision regarding the data in accordance with
907 KAR 1:671, Section
9.
(9)
(a) The department shall refer any suspected
intentional alteration of clinical documentation or creation of documentation
after an MDS assessment has been transmitted to the Office of Inspector General
(OIG) for investigation of possible fraud.
(b) A fraud investigation may result in a
felony or misdemeanor criminal conviction.
(10) An NF's rate shall be effective
beginning on the first date of the second quarter following the MDS extraction
date.
(11) An MDS validation
review, if conducted, shall be initiated in the month containing the
corresponding rate effective date.
(12) A rate sanction shall be applied on the
rate effective date following the validation review initiation date.
(13) MDS assessment accuracy thresholds and
corresponding rate sanctions shall be established in accordance with this
subsection.
(a) If a price-based NF's
percentage of accurate MDS assessments is between sixty-five (65) and
seventy-nine (79) percent, the price-based NF's rate shall be sanctioned by
fifty (50) cents per patient day.
(b) If a price-based NF's percentage of
accurate MDS assessments is between forty (40) and sixty-four (64) percent, the
price-based NF's rate shall be sanctioned by sixty (60) cents per patient
day.
(c) If a price-based NF's
percentage of accurate MDS assessments is below forty (40) percent, the
price-based NF's rate shall be sanctioned by seventy (70) cents per patient
day.
Section
8. Limitation on Charges to Residents.
(1) Except for applicable deductible and
coinsurance amounts, an NF that receives reimbursement for a resident pursuant
to Section 6 of this administrative regulation shall not charge a resident or
his representative for the cost of routine or ancillary services.
(2) An NF may charge a resident or his
representative for an item pursuant to
42 C.F.R.
483.10(f)(11)(ii) if:
(a) The item is requested by the
resident;
(b) The NF informs the
resident in writing that there will be a charge; and
(c) Medicare, Medicaid, or another third
party does not pay for the item.
(3) An NF shall:
(a) Not require a resident, or responsible
representative of the resident, to request any item or services as a condition
of admission or continued stay; and
(b) Inform a resident, or responsible
representative of the resident, requesting an item or service for which a
charge will be made in writing that there will be a charge and the amount of
the charge.
(4) Reserved
bed days, per resident, for an NF or an NF-W shall be:
(a) Reimbursed for a maximum of fourteen (14)
days per calendar year due to hospitalization. Accumulated bed reserve days
shall follow a resident if the resident relocates to another facility within a
calendar year rather than starting over at zero due to relocation;
(b) Reimbursed for a maximum of ten (10) days
during a calendar year for leaves of absence other than hospitalization.
Accumulated bed reserve days shall follow a resident if the resident relocates
to another facility within a calendar year rather than starting over at zero
due to the relocation;
(c)
Reimbursed at seventy-five (75) percent of a facility's rate if the facility's
occupancy percent is ninety-five (95) percent or greater for the calendar
quarter preceding the bed reserve day; and
(d) Reimbursed at fifty (50) percent of a
facility's rate if the facility's occupancy percent is less than ninety-five
(95) percent for the calendar quarter preceding the bed reserve day.
(5) Except for oxygen therapy,
durable medical equipment (DME) and supplies shall:
(a) Be furnished by an NF; and
(b) Not be billed to the department under a
separate DMS claim pursuant to
907 KAR 1:479, Section
6(3).
(6) Dentures,
lenses, frames, or hearing aids shall be paid for through the resident's
patient liability or spend down amounts and limited to one (1) replacement per
item per calendar year.
Section
9. Reimbursement for Required Services Under the Preadmission
Screening Resident Review (PASRR).
(1) Prior
to an admission of an individual, a price-based NF shall conduct a level I
PASRR in accordance with
907 KAR 1:755, Section
4.
(2) The department shall
reimburse an NF for services delivered to an individual if the NF complies with
the requirements of
907 KAR 1:755.
(3) Failure to comply with
907 KAR 1:755 may be grounds for
termination of the NF's participation in the Medicaid Program.
Section 10. Price-Based NF
Protection Period and Budget Constraints.
(1)
A county-owned hospital-based nursing facility shall not receive a rate that is
less than the rate that was in effect on June 30, 2002.
(2) For each year of the biennium, a
price-based NF shall:
(a) Receive an
adjustment pursuant to Section 5(8) and (11) of this administrative regulation;
or
(b) Except for a county-owned
hospital-based nursing facility pursuant to subsection (1) of this section, not
receive an increase if the price-based NF's rate is greater than its standard
price.
Section
11. Cost Report.
(1) A Medicare
cost report and the Supplemental Medicaid Schedules shall be submitted pursuant
to time frames established in the CMS Medicare Provider Reimbursement Manual -
Part 2 (Pub.
15-2) Sections 102, 102.1, 102.3, and 104, using
the Instructions for Completing the Medicaid Supplemental Schedules.
(2) A copy of a price-based NF's Medicare
cost report shall be submitted for the most recent fiscal year end.
Section 12. Ancillary Services.
(1) Except for oxygen therapy and for
ancillary services provided to an individual in a critical access hospital
swing bed, the department shall reimburse for an ancillary service that meets
the criteria established in
907 KAR 1:023 utilizing the
corresponding outpatient procedure code rate listed in the Medicaid Physician
Fee Schedule established in
907 KAR 3:010, Section
3.
(2) The department shall
reimburse for an oxygen therapy utilizing the Medicaid DME Program fee schedule
established in
907 KAR 1:479.
(3) Respiratory therapy and respiratory
therapy supplies shall be a routine service.
(4) Reimbursement for ancillary services
provided to an individual in a critical access hospital swing bed shall be
included in the critical access hospital swing bed reimbursement established in
Section 3(2) of this administrative regulation.
Section 13. Appeal Rights. A price-based NF
may appeal a department decision as to the application of this administrative
regulation in accordance with
907 KAR 1:671.
Section 14. Supplemental Payments to Nonstate
Government-Owned or Operated Nursing Facilities.
(1) Beginning July 1, 2001, subject to state
funding made available for this provision by a transfer of funds from a
governmental entity, the department shall make a supplemental payment to a
qualified nursing facility.
(2) To
qualify for a supplemental payment under this section, a nursing facility
shall:
(a) Be owned or operated by a local
unit of government pursuant to
42 C.F.R.
447.272(a)(2);
(b) Have at least 140 or more
Medicaid-certified beds; and
(c)
Have a Medicaid occupancy rate at or above seventy-five (75) percent.
(3) For each state fiscal year,
the department shall calculate the maximum supplemental payment that it may
make to qualifying nursing facilities in accordance with
42 C.F.R.
447.272.
(4) Using the data reported by a nursing
facility on a Schedule NF-7 submitted to the department as of December 31,
2000, the department shall identify each nursing facility that meets the
criteria established in subsection (2) of this section.
(5) The department shall determine a
supplemental payment factor for a qualifying nursing facility by dividing the
qualifying nursing facility's total Medicaid days by the total Medicaid days
for all qualifying nursing facilities.
(6) The department shall determine a
supplemental payment for a qualifying nursing facility by applying the
supplemental payment factor established in subsection (5) of this section to
the total amount available for funding under this section.
(7) Total payments made under this section
shall not exceed the amount determined in subsection (3) of this
section.
(8) Payments made under
this section shall:
(a) Apply to services
provided on or after April 1, 2001; and
(b) Be made on a quarterly basis.
Section 15. Federal
Approval and Federal Financial Participation. The department's coverage of
services pursuant to this administrative regulation shall be contingent upon:
(1) Receipt of federal financial
participation for the coverage; and
(2) Centers for Medicare and Medicaid
Services' approval for the coverage.
Section 16. Incorporation by Reference.
(1) The following material is incorporated by
reference:
(a) "Medicare Provider
Reimbursement Manual - Part 2 (Pub. 15-2), Sections 102, 102.1,
102.3, and 104", October 2007;
(b)
The "Instructions for Completing the Medicaid Supplemental Schedules", April
2015;
(c) The "Supplemental
Medicaid Schedules", April 2015; and
(d) "Minimum Data Set (MDS) - Version 3.0,
Resident Assessment and Care Screening", 10/1/2016.
(2) This material may be inspected, copied,
or obtained, subject to applicable copyright law, at the:
(a) Department for Medicaid Services, 275
East Main Street, Frankfort, Kentucky 40621, Monday through Friday, 8 a.m. to
4:30 p.m.; and
STATUTORY AUTHORITY:
KRS
142.361(5),
142.363(3),
194A.030(2),
194A.050(1),
205.520(3)