(1)
Reimbursement as Full Payment. Each ICF that provides
services to publicly aided patients shall, as a condition of receipt of
payment, accept reimbursement at rates established by EOHHS as full payment and
discharge of all obligations to such individuals. There shall be no duplication
or supplementation of payment for services provided to publicly assisted
patients.
(2)
Reimbursement Limitation. Reimbursement determined
under
101 CMR 129.00 for publicly
assisted patients shall not exceed that reimbursement that would result from
application of the Principles of Reimbursement of Provider Costs established
under
42 U.S.C. §§
1395
et seq., the Medicare
Act.
(3)
Allowable
Costs.
(a) Pursuant to the
requirements and rate and charge determination formulas of
101 CMR 129.00, ICFs shall
be reimbursed for allowable costs. These costs must be reasonable costs and
must be directly related to health care and services.
(b) Except as otherwise required in
101 CMR 129.00 and the
instructions to the ICF Cost Report, allowable costs for inpatient care and
services shall be determined in accordance with the Principles of Reimbursement
for Provider Costs under
42 U.S.C. §§
1395
et seq. as set forth in
42 CFR 413, et seq. and the Provider Reimbursement
Manual.
(c) Depreciation
shall be an allowable cost provided that it is based on historical cost and is
calculated by the straight line method. The useful life of assets shall be
determined in accordance with the most recent version of the American
Hospital Association's Estimated Useful Lives of Depreciable Hospital
Assets.
(d) Costs for
leased facilities and fixed equipment shall be an allowable cost to the extent
that such costs do not exceed the allowable cost that would have been
recognized if the ICF had purchased the equipment or facilities and to the
extent that such costs do not exceed rental charges of comparable equipment or
facilities.
(e) Costs for equipment
and facilities leased under contractual provisions that provide a purchase
option at the end of the lease term without more than nominal payment shall not
be allowed. Depreciation shall be allowed pursuant to 101 CMR
129.04(3)(c).
(f) Interest expense
in excess of interest income shall be an allowable cost.
(g) Administrative and general cost in excess
of miscellaneous income shall be an allowable cost.
(h) Overhead expenses shall be allocated to
non-patient services.
(i) Costs for
consultants shall be amortized over the useful life of the asset that
consultant work is related to, and the amortized cost shall be an allowable
cost.
(j) Payments to professional
organizations, trade associations and the like, and comprehensive health
planning agencies shall be allowed.
(k) Limitation of basis for depreciation,
interest, and equity. Where there has been a change of ownership on or after
July 18, 1984, the allowable basis of fixed assets shall be the lower of the
acquisition cost or the basis allowed the immediate prior owner reduced by the
amount of actual depreciation paid to the prior owner of the facility during
all years in which the prior owner participated in the MassHealth
program.
(4)
Excluded Costs. The following costs are excluded under
101 CMR 129.00:
(a) costs for whole blood, appliances, and
patient take-home items;
(b) bad
debts, charity, courtesy allowances, and free care to medically indigent
persons; and
(c) costs (including
legal fees, accounting and administrative costs, travel costs, and the costs of
feasibility studies) attributable to the negotiation or settlement of the sale
or purchase of any capital asset (by acquisition or merger) for which payment
has previously been made by the MassHealth agency.
