Missouri Code of State Regulations
Title 13 - DEPARTMENT OF SOCIAL SERVICES
Division 70 - MO HealthNet Division
Chapter 10 - Nursing Home Program
Section 13 CSR 70-10.030 - Prospective Reimbursement Plan for Nonstate-Operated Facilities for ICF/IID Services
Universal Citation: 13 MO Code of State Regs 70-10.030
Current through Register Vol. 49, No. 18, September 16, 2024
PURPOSE: This amendment provides for ICF/IID reimbursement rates to be recalculated (i.e., rebased) using a more recent base year, which allows the division to pay rates that reflect more current costs incurred by ICF/IID providers.
(1) Objectives. This rule establishes a payment plan for nonstate-operated intermediate care facility for individuals with intellectual disabilities (ICF/IID) services.
(2) General Principles.
(A) The MO HealthNet program shall reimburse
qualified providers of ICF/IID services based solely on the individual MO
HealthNet participant's days of care (within benefit limitations) multiplied by
the facility's Title XIX per diem rate less any payments made by
participants.
(B) Effective
November 1, 1986, the Title XIX per diem rate for all ICF/IID facilities
participating on or after October 31, 1986, shall be the lower of-
1. The Medicare per diem rate, if applicable;
or
2. The reimbursement rate as
determined in accordance with this regulation.
(C) This plan has an effective date of
November 1, 1986, at which time prospective per diem rates shall be calculated
for the remainder of the state's FY-87 and future fiscal years. Per diem rates
established by updating facilities' base years to FY-85 may be subject to
retroactive and prospective adjustment based on audit of the facilities' new
base year period.
(D) The Title XIX
per diem rates as determined by this plan shall apply only to services
furnished on or after November 1, 1986.
(E) All illustrations and examples provided
throughout this rule are for illustration purposes only and are not meant to be
actual calculations.
(3) Definitions.
(A) "Allowable cost areas "
means those cost areas that are allowable for allocation to the MO HealthNet
program based upon the principles established in this rule. The allowability of
cost areas, not specifically addressed in this rule, will be based upon
criteria of the Medicare Provider Reimbursement Manual (HIM-15) and section (6)
of this rule.
(B) "Average private
pay charge" means the usual and customary charge for non-MO HealthNet patients
determined by dividing total non-MO HealthNet days of care into total revenue
collected for the same service that is included in the MO HealthNet per diem
rate, excluding negotiated payment methodologies with the Veterans
Administration and the Missouri Department of Mental Health.
(C) "Cost report" means a report detailing
the cost of rendering covered services for the fiscal reporting period.
Providers must file the cost report on forms provided by and in accordance with
the procedures of the Department of Social Services.
(D) "Department" means the Missouri
Department of Social Services, unless otherwise specified.
(E) "Director" means the director of the
Missouri Department of Social Services, unless otherwise specified.
(F) "Effective Date" means November 1,
1986.
(G) "ICF/IID" means
nonstate-operated facilities certified to provide intermediate care for
individuals with intellectual disabilities under the Title XIX
program.
(H) "Medicare Rate" means
the allowable cost of care permitted by Medicare standards and principles of
reimbursement.
(I) "New
Construction" means newly built facilities or parts, for which an approved
Certificate of Need (CON) or applicable waivers were obtained and which were
newly completed and operational on or after November 1, 1986.
(J) "New Owners" means the original owners of
new construction.
(K) "Providers"
means, under the Prospective Reimbursement Plan, a nonstate-operated ICF/IID
facility with a valid participation agreement, in effect on or after October
31, 1986, with the Missouri Department of Social Services for the purpose of
providing long-term care (LTC) services to Title XIX-eligible participants.
Facilities certified to provide intermediate care services to individuals with
intellectual disabilities under the Title XIX program may be offered a MO
HealthNet participation agreement on or after January 1, 1990, only if 1) the
facility has no more than fifteen (15) beds for individuals with intellectual
disabilities, and 2) there is no other licensed residential living facility for
individuals with intellectual disabilities within a radius of one-half (1/2)
mile of the facility seeking participation in the MO HealthNet
program.
(L) "Reasonable and
Adequate Reimbursement" means reimbursement levels which meet the needs of an
efficiently and economically operated facility and which in no case exceed
normal market costs.
(M) "Related
parties" means-
1. An individual or group,
regardless of the business structure of either, where, through their
activities, one (1) individual's or group's transactions are for the benefit of
the other and the benefits exceed those which are usual and customary in the
dealings;
2. One (1) or more
persons have an ownership or controlling interest in a party, and the person(s)
or one (1) or more relatives of the person(s) has an ownership or controlling
interest in the other party. For the purposes of this paragraph, ownership or
controlling interest does not include a bank, savings bank, trust company,
building and loan association, savings and loan association, credit union,
industrial loan and thrift company, investment banking firm, or insurance
company unless the entity, directly or through a subsidiary, operates a
facility; or
3. As used in section
(3), the following terms mean:
A. "Indirect
Ownership" or "Indirect Interest" means an ownership interest in an entity that
has an ownership interest in another entity. This term includes an ownership
interest in any entity that has an indirect ownership interest in an
entity;
B. "Ownership Interest"
means the possession of equity in the capital, in the stock, or in the profits
of an entity;
C. "Ownership
Interest" or "Controlling Interest" means a person or corporation(s)-
(I) Has an ownership interest totaling five
percent (5%) or more in an entity;
(II) Has an indirect ownership interest equal
to five percent (5%) or more in an entity. The amount of indirect ownership
interest is determined by multiplying the percentages of ownership in each
entity;
(III) Has a combination of
direct and indirect ownership interest equal to five percent (5%) or more in an
entity;
(IV) Owns an interest of
five percent (5%) or more in any mortgage, deed of trust, note, or other
obligation secured by an entity, if that interest equals at least five percent
(5%) of the value of the property or assets of the entity. The percentage of
ownership resulting from the obligations is determined by multiplying the
percentage of interest owned in the obligation by the percentage of the
entity's assets used to secure the obligation;
(V) Is an officer or director of an entity;
or
(VI) Is a partner in an entity
that is organized as a partnership;
D. "Relative" means persons related by blood
or marriage to the fourth degree of consanguinity; and
E. "Entity" means any person, corporation,
partnership, or association.
(N) "Rural " means those counties that are
not defined as urban.
(O) "Urban "
means counties that are standard metropolitan statistical areas including
Andrew, Boone, Buchanan, Cass, Christian, Clay, Franklin, Greene, Jackson,
Jasper, Jefferson, Newton, Platte, Ray, St. Charles, St. Louis, and St. Louis
City.
(4) ICF/IID Rate Computation. Except in accordance with other provisions of this rule, the provisions of this section shall apply to all providers of ICF/IID services certified to participate in Missouri's MO HealthNet program. Rate determination shall be based on reasonable and adequate reimbursement levels for allowable cost items described in this rule which are related to ordinary and necessary care for the level-of-care provided for an efficiently and economically operated facility. All providers shall submit documentation of expenses for allowable cost areas. The department shall have authority to require those uniform accounting and reporting procedures and forms as it deems necessary. A reasonable and adequate reimbursement in each allowable cost area will be determined.
(A) Prospective Reimbursement Rate
Determination through December 31, 2018.
1.
The Title XIX prospective per diem reimbursement rate for the remainder of
state Fiscal Year 1987 shall be the facility's per diem reimbursement payment
rate in effect on October 31, 1986, as adjusted by updating the facility's
allowable base year to its 1985 fiscal year. Each facility's per diem costs as
reported on its Fiscal Year 1985 Title XIX cost report will be determined in
accordance with the principles set forth in this rule. If a facility has not
filed a 1985 fiscal year cost report, the MO HealthNet Division will use the
most current cost report on file with the department to set a facility's per
diem rate. Facilities with less than a full twelve-(12-) month 1985 fiscal year
will not have their base year rates updated.
2. For state FY-88 and dates of service
beginning July 1, 1987, the negotiated trend factor shall be equal to two
percent (2%) to be applied in the following manner: Two percent (2%) of the
average per diem rate paid to both state- and nonstate-operated ICF/IID
facilities on June 1, 1987, shall be added to each facility's rate.
3. For state FY-89 and dates of service
beginning January 1, 1989, the negotiated trend factor shall be equal to one
percent (1%) to be applied in the following manner: One percent (1%) of the
average per diem rate paid to both state- and nonstate-operated ICF/IID
facilities on June 1, 1988, shall be added to each facility's rate.
4. For state FY-91 and dates of service
beginning July 1, 1990, the negotiated trend factor shall be equal to one
percent (1%) to be applied in the following manner: One percent (1%) of the
average per diem rate paid to both state- and nonstate-operated ICF/IID
facilities on June 1, 1990, shall be added to each facility's rate.
5. Prospective payment adjustment (PPA). A
FY92 P PA will be provided prior to the end of the state fiscal year for
nonstate-operated ICF/IID facilities with a current provider agreement on file
with the MO HealthNet Division as of October 1, 1991.
A. For providers that qualify, the P PA shall
be the lesser of-
(I) The provider's facility
peer group factor (FPGF) times the projected patient days (PPD) covered by the
adjustment year times the prospective payment adjustment factor (PPAF) times
the nonstate-operated intermediate care facility for individuals with
intellectual disabilities ceiling (ICFIIDC) on October 1, 1991 (FPGF x PPD x
PPAF x ICFIIDC). For example: A provider having nine hundred twenty (920) paid
days for the period May 1991 to July 1991 out of a total paid days for this
same period of twenty-eight thousand five hundred sixty-one (28,561) represents
an FPGF of three and twenty-two hundredths percent (3.22%). So using the FPGF
of 3.22% x 114,244 x 24.5% x $156.01 = $140,607; or
(II) The provider FPGF times one hundred
forty-five percent (145%) of the amount credited to the intermediate care
revenue collection center (ICRCC) of the State Title XIX Fund (STF) for the
period October 1, 1991 through December 31, 1991.
B. FPGF-is determined by using each ICF/IID
facility's paid days for the service dates in May 1991 through July 1991 as of
September 20, 1991, divided by the sum of the paid days for the same service
dates for all providers qualifying as of the determination date of October 16,
1991.
C. ICFIIDC-is one hundred
fifty-six dollars and one cent ($156.01) on October 1, 1991.
D. PPAF-is equal to twenty-four and one half
percent (24.5%) for fiscal year 1992 which includes an adjustment for economic
trends.
E. PPD-is the projection of
one hundred fourteen thousand two hundred forty-four (114,244) patient days
made on October 1, 1991, for the adjustment year.
6. FY-92 trend factor and Workers'
Compensation. All facilities with either an interim rate or a prospective per
diem rate in effect on September 1, 1992, shall be granted an increase to their
per diem rate effective September 1, 1992, of eight dollars and eighty-six
cents ($8.86) per patient day related to the continuation of the FY-92 trend
factor and the Workers' Compensation adjustment. This adjustment is equal to
seven and one-half percent (7.5%) of the March 1992 weighted average per diem
rate of one hundred eighteen dollars and fourteen cents ($118.14) for all
nonstate-operated ICF/IID facilities.
7. FY-93 negotiated trend factor. All
facilities with either an interim rate or prospective per diem rate in effect
on September 1, 1992, shall be granted an increase to their per diem rate
effective September 1, 1992, of one dollar and sixty-six cents ($1.66) per
patient day for the negotiated trend factor. This adjustment is equal to one
and four-tenths percent (1.4%) of the March 1992 weighted average per diem rate
of one hundred eighteen dollars and fourteen cents ($118.14) for all
nonstate-operated ICF/IID facilities.
8. FY-96 negotiated trend factor. All
nonstate-operated ICF/IID facilities shall be granted an increase to their per
diem rates effective for dates of service beginning January 1, 1996, of six
dollars and seven cents ($6.07) per patient day for the negotiated trend
factor. This adjustment is equal to four and six-tenths percent (4.6%) of the
weighted average per diem rates paid to nonstate-operated ICF/IID facilities on
June 1, 1995, of one hundred and thirty-one dollars and ninety-three cents
($131.93).
9. State FY-99 trend
factor. All nonstate-operated ICF/IID facilities shall be granted an increase
to their per diem rates effective for dates of service beginning July 1, 1998,
of four dollars and forty-seven cents ($4.47) per patient day for the trend
factor. This adjustment is equal to three percent (3%) of the weighted average
per diem rate paid to nonstate-operated ICF/IID facilities on June 30, 1998, of
one hundred forty-eight dollars and ninety-nine cents ($148.99).
10. State FY-2000 trend factor. All
nonstate-operated ICF/IID facilities shall be granted an increase to their per
diem rates effective for dates of service beginning July 1, 1999, of four
dollars and sixty-three cents ($4.63) per patient day for the trend factor.
This adjustment is equal to three percent (3%) of the weighted average per diem
rate paid to nonstate-operated ICF/IID facilities on April 30, 1999, of one
hundred fifty-four dollars and forty-three cents ($154.43). This increase shall
only be used for increases for the salaries and fringe benefits for direct care
staff and their immediate supervisors.
11. State FY-2001 trend factor. All
nonstate-operated ICF/IID facilities shall be granted an increase to their per
diem rates effective for dates of service beginning July 1, 2000, of four
dollars and eighty-one cents ($4.81) per patient day for the trend factor. This
adjustment is equal to three percent (3%) of the weighted average per diem rate
paid to nonstate-operated ICF/IID facilities on April 30, 2000, of one hundred
sixty dollars and twenty-three cents ($160.23). This increase shall only be
used for increases for salaries and fringe benefits for direct care staff and
their immediate supervisors.
12.
State FY-2007 trend factor. All nonstate-operated ICF/IID facilities shall be
granted an increase of seven percent (7%) to their per diem rates effective for
dates of service billed for state fiscal year 2007 and thereafter. This
adjustment is equal to seven percent (7%) of the per diem rate paid to
nonstate-operated ICF/IID facilities on June 30, 2006.
13. State FY-2008 trend factor. Effective for
dates of service beginning July 1, 2007, all nonstate-operated ICF/IID
facilities shall be granted an increase to their per diem rates of two percent
(2%) for the trend factor. This adjustment is equal to two percent (2%) of the
per diem rate paid to nonstate-operated ICF/IID facilities on June 30,
2007.
14. State FY-2009 trend
factor. Effective for dates of service beginning July 1, 2008, all
nonstate-operated ICF/IID facilities shall be granted an increase to their per
diem rates of three percent (3%) for the trend factor. This adjustment is equal
to three percent (3%) of the per diem rate paid to nonstate-operated ICF/IID
facilities on June 30, 2008.
15.
State FY-2009 catch up increase. Effective for dates of service beginning July
1, 2008, all nonstate-operated ICF/IID facilities shall be granted an increase
to their per diem rates of thirteen and ninety-five hundredths percent
(13.95%). This adjustment is equal to thirteen and ninety-five hundredths
percent (13.95%) of the per diem rate paid to nonstate-operated ICF/IID
facilities on June 30, 2008. This increase is intended to provide compensation
to providers for the years where no trend factor was given. The catch up
increase was based on the CMS PPS Skilled Nursing Facility Input Price Index
(four- (4-) quarter moving average).
16. State FY-2012 trend factor. Effective for
dates of service beginning October 1, 2011, all nonstate-operated ICF/IID
facilities shall be granted an increase to their per diem rates of one and four
tenths percent (1.4%) for the trend factor. This adjustment is equal to one and
four tenths percent (1.4%) of the per diem rate paid to nonstate-operated
ICF/IID facilities on September 30, 2011.
17. State FY-2014 trend factor. Effective for
dates of service beginning January 1, 2014, all nonstate-operated ICF/IID
facilities shall be granted an increase to their per diem rates of three
percent (3%) for the trend factor. This adjustment is equal to three percent
(3%) of the per diem rate paid to nonstate-operated ICF/IID facilities on
December 31, 2013.
18. State
FY-2016 trend factor. Effective for dates of service beginning February 1,
2016, all nonstate-operated ICF/IID facilities shall be granted an increase to
their per diem rates of one percent (1%) for the trend factor. This adjustment
is equal to one percent (1%) of the per diem rate paid to nonstate-operated
ICF/IID facilities on January 31, 2016.
19. State FY-2017 trend factor. Effective for
dates of service beginning September 1, 2016, all nonstate-operated ICF/IID
facilities shall be granted an increase to their per diem rates of two percent
(2%) for the trend factor. This adjustment is equal to two percent (2%) of the
per diem rate paid to nonstate-operated ICF/IID facilities on August 31,
2016.
20. State FY-2018 per diem
adjustment. Effective for dates of service beginning September 1, 2017, all
nonstate-operated ICF/IID facilities shall be subject to a decrease to their
per diem rates of two and eighty-two hundredths percent (2.82%). This
adjustment is equal to two and eighty-two hundredths percent (2.82%) of the per
diem rate paid to nonstate-operated ICF/IID facilities on August 31,
2017.
(B) Per Diem Rate
Calculation Effective for Dates of Service Beginning January 1, 2019. Effective
for dates of service beginning January 1, 2019, the MO HealthNet Division shall
rebase nonstate-operated ICF/IID facilities' per diem rates using the
facilities' 2017 fiscal year-end cost reports. The rebased rates are contingent
upon approval of the state plan amendment by the Centers for Medicare and
Medicaid Services.
1. Prospective Rate
Calculation.
A. Each nonstate-operated ICF/IID
shall have its prospective rate recalculated based on its 2017 fiscal year end
cost report using the same principles and methodology as detailed throughout
sections (1)-(13) of this regulation.
(I) The
costs from the 2017 fiscal year end cost reports shall be trended using the
indices from the most recent publication of the Healthcare Cost Review
available to the division using the "CMS Nursing Home without Capital Market
Basket" table. The costs shall be trended using the four- (4-) quarter moving
average. The costs shall be trended for the years following the cost report
year, up to and including the state fiscal year corresponding to the effective
date of the rates. For SFY 2019, the trends are as follows:
(a) 2018=3.025%
(b) 2019=2.65%
(II) If a facility's total calculated per
diem set forth in this section is less than the facility's current rate, the
facility shall continue to receive its current rate.
(III) The division will use the FY 2017 cost
report to determine the ICF/IID prospective rate, set forth as follows:
(a) Total Routine Service Cost. Total routine
service cost includes patient care, ancillary, dietary, laundry, housekeeping,
plant operations, and administration. Each ICF/ IID's Title XIX Routine Service
Cost per diem shall be calculated as follows:
I. The total routine service costs as
reported on the cost report shall be adjusted for minimum utilization, if
applicable, trended to the current state fiscal year, and divided by the total
patient days to determine the per diem. The minimum utilization adjustment will
be determined by applying the unused capacity percent to the sum of the
laundry, housekeeping, plant operations, and administration expenses. The
following is an illustration of how this item (4) (B)1.A.(III)(a)I. is
calculated:
|
Licensed/Certified Bed Days |
|
|
(9 beds x 365 days) |
3,285 |
|
Total Patient Days |
2,900 |
|
Percent Occupied (2,900/3,285) |
88% |
|
Bed Days @ Minimum Occupancy of 90% (3,285 x 90%) |
2,957 |
|
Unused Capacity (90% of Bed Days Less Total Patient Days) |
57 |
|
Unused Capacity Percent for Minimum Utilization Adjustment (Unused Capacity/90% of Bed Days) |
1.93% |
|
Minimum Utilization Days for Return on Owner's Equity (Greater of 90% of Bed Days or Total Patient Days) |
2,957 |
|
*Minimum Utilization Adjustment |
|
|
Laundry |
$ 5,000 |
|
Housekeeping |
$ 8,000 |
|
Plant Operations |
$ 46,000 |
|
Administration |
$165,000 |
|
Total Expense |
$224,000 |
|
Unused Capacity Percent |
1.93% |
|
Minimum Utilization Adjustment (Unused Capacity Percent x Total Expense) |
$ 4,323 |
|
Patient Care |
$400,000 |
|
Ancillary |
$ 10,000 |
|
Dietary |
$ 25,000 |
|
Laundry |
$ 5,000 |
|
Housekeeping |
$ 8,000 |
|
Plant Operations |
$ 46,000 |
|
Administration |
$165,000 |
|
Total Routine Service Cost |
$659,000 |
|
Less: Minimum Utilization Adjustment* |
($ 4,323) |
|
Routine Service Cost, Adjusted for Minimum Utilization |
$654,677 |
|
SFY 2018 Trend |
3.025% |
|
SFY 2019 Trend |
2.65% |
|
Trended Routine Service Cost |
$692,355 |
|
Total Patient Days |
2,900 |
|
Routine Service Cost Per Diem |
$ 238.74 |
(b) Intermediate Care Facility for
Individuals with Intellectual Disabilities Federal Reimbursement Allowance
(ICF/IID FRA). The SFY 2019 ICF/IID FRA provider assessment as determined in
accordance with 9 CSR 10-31.030 is divided by
total patient days to determine the ICF/IID FRA per diem.
I. The following is an illustration of how
the ICF/ IID FRA assessment is calculated:
|
SFY 2019 ICF/IID FRA Assessment |
$40,000 |
|
Total Patient Days |
2,900 |
|
ICF/IID FRA Per Diem |
$ 13.79 |
(c) Return on Equity. An owner's net equity
consists of investment capital and working capital as indicated in subsection
(6)(S). Each ICF/IID's Return on Equity per diem is calculated as follows:
I. Investment Capital. Investment capital
includes the investment in building, property, and equipment (cost of land,
mortgage payments toward principal, and equipment purchase less the accumulated
depreciation).
II. Working Capital.
Working capital represents the amount of capital which is required to ensure
proper operation of the facility and shall be calculated as 1.1 months of the
total expenses less depreciation.
III. The total net equity shall be multiplied
by the rate of return as set forth in subsection (6)(S) to determine the return
on equity. The return on equity is subject to the minimum occupancy percent of
90% in determining the per diem.
IV. The following is an illustration of how
this subpart (4)(B)1.A.(III)(c) is calculated:
|
Investment Capital |
Equipment |
Building |
Total |
|
Cost |
$130,000 |
$300,000 |
$430,000 |
|
Less: Prior Years Depreciation |
($120,000) |
($225,000) |
($345,000) |
|
Less: Current Year Depreciation |
($2,400) |
($8,500) |
($10,900) |
|
Total Investment Capital |
$7,600 |
$66,500 |
$74,100 |
|
Working Capital |
|||
|
Total Expenses |
$659,000 |
||
|
Less: Current Year Depreciation Expense |
($10,900) |
||
|
$648,100 |
|||
|
Divided by 12 Month |
12 |
||
|
$ 54,008 |
|||
|
Times 1.1 Months |
1.1 |
||
|
Total Working Capital |
$ 59,409 |
||
|
Net Equity (Investment Capital + Working Capital) |
$133,509 |
||
|
Rate of Return |
5.125% |
||
|
Return on Equity |
$ 6,842 |
||
|
Minimum Utilization Days |
2,957 |
||
|
Return on Equity Per Diem |
$ 2.31 |
(c) Rebased Per Diem Rate. The total
calculated per diem is the sum of the Routine Service Cost per diem, the
ICF/IID FRA per diem and the Return on Equity per diem. To determine the
rebased per diem rate, the total calculated per diem is compared to the current
per diem rate and the facility will be held harmless if the total calculated
per diem is less than the current per diem rate (i.e., if the total calculated
per diem is less than the current per diem rate, the facility would receive the
current per diem).
|
Routine Service Cost per diem |
$238.74 |
|
ICF/IID FRA per diem |
$ 13.79 |
|
Return on Equity per diem |
$ 2.31 |
|
Total Calculated Per Diem |
$254.84 |
|
Current Per Diem Rate |
$200.00 |
|
Rebased Per Diem Rate |
$254.84 |
(If the total calculated per diem is less than the current per diem rate, the facility would receive the current per diem rate)
B. Effective
for dates of service beginning October 1, 2022, each nonstate-operated ICF/IID
shall have its prospective rate recalculated based on its 2020/2021 fiscal
year-end cost report using the same principles and methodology as detailed
throughout sections (1)-(13) of this regulation and as set forth in
subparagraph (4)(B)1.A.
(I) The
nonstate-operated ICF/IID shall have its prospective rate recalculated based on
their 2021 fiscal year-end cost report unless they do not have a full
twelve-(12-) month 2021 fiscal year end cost report in which case the 2020
fiscal year-end cost report shall be used to calculate the prospective
rate.
(II) The costs from the 2020
and 2021 fiscal yearend cost reports shall be trended using the indices from
the most recent publication of the Healthcare Cost Review available to the
division using the "CMS Nursing Home without Capital Market Basket" table. The
costs shall be trended using the four- (4-) quarter moving average. The costs
shall be trended for the years following the cost report year, up to and
including the state fiscal year corresponding to the effective date of the
rates. For SFY 2023, the trends are as follows:
(a) 2021=2.825%
(b) 2022=2.500%
(c) 2023=3.3800%
(III) The current year depreciation will not
be deducted from the working capital to determine Return on Equity.
2. Interim Rate
Calculation.
A. In the case of a newly
certified facility where a valid Title XIX participation agreement has been
executed, a request for an interim rate must be submitted in writing to the MO
HealthNet Division.
(I) The interim rate shall
be determined based on the projected estimated operating costs. The facility's
request must specifically and clearly identify the interim rate and be
supported by complete and accurate documentation satisfactory to the single
state agency. Documentation submitted must include a budget of the projected
estimated operating costs. Other documentation may also be required to be
submitted upon the request of the division.
(II) The establishment of the prospective
rate for all new construction facility providers shall be based on the second
full facility fiscal year cost report (i.e., rate setting cost report) prepared
in accordance with the principles of this rule. This cost report shall be based
on actual operating costs and shall be prepared and submitted in accordance
with the reporting requirements in section (7) of this rule.
(III) Prior to establishment of a prospective
rate for newly certified facility providers, the cost reports may be subject to
an on-site audit by the Department of Social Services or authorized
representative to determine the facility's actual allowable costs. Allowability
of costs will be determined as described in subsection (3)(A) of this
rule.
(IV) The cost report, audited
or unaudited, will be reviewed by the MO HealthNet Division, and a prospective
reimbursement rate shall be determined on the allowable per diem cost as set
forth in section (4) of this rule. The prospective reimbursement rate shall be
effective on the first day of the facility's rate setting cost report and
payment adjustments shall be made for claims paid at the interim
rate.
3.
Adjustments to rates. The prospectively determined reimbursement rate may be
adjusted only under the following conditions:
A. When information contained in a facility's
cost report is found to be fraudulent, misrepresented, or inaccurate, the
facility's reimbursement rate may be reduced, both retroactively and
prospectively, if the fraudulent, misrepresented, or inaccurate information as
originally reported resulted in establishment of a higher reimbursement rate
than the facility would have received in the absence of this information. No
decision by the MO HealthNet agency to impose a rate adjustment in the case of
fraudulent, misrepresented, or inaccurate information in any way shall affect
the MO HealthNet agency's ability to impose any sanctions authorized by statute
or rule. The fact that fraudulent, misrepresented, or inaccurate information
reported did not result in establishment of a higher reimbursement rate than
the facility would have received in the absence of the information also does
not affect the MO HealthNet agency's ability to impose any sanctions authorized
by statute or rules;
B.
Extraordinary circumstances. A participating facility that has a prospective
rate may request an adjustment to its prospective rate due to extraordinary
circumstances. This request should be submitted in writing to the division
within one (1) year of the occurrence of the extraordinary circumstance. The
request should clearly and specifically identify the conditions for which the
rate adjustment is sought. The dollar amount of the requested rate adjustment
should be supported by complete and accurate documentation satisfactory to the
division. If the division makes a written request for additional information
and the facility does not comply within ninety (90) days of the request for
additional information, the division shall consider the request withdrawn.
Requests for rate adjustments that have been withdrawn by the facility or are
considered withdrawn because of failure to supply requested information may be
resubmitted once for the requested rate adjustment. In the case of a rate
adjustment request that has been withdrawn and then resubmitted, the effective
date shall be the first day of the month in which the resubmitted request was
made providing that it was made prior to the tenth day of the month. If the
resubmitted request is not filed by the tenth of the month, rate adjustments
shall be effective the first day of the following month. Conditions for an
extraordinary circumstance are as follows:
(I)
When the provider can show that it incurred higher costs due to circumstances
beyond its control, and the circumstances are not experienced by the nursing
home or ICF/IID industry in general, and the circumstances have a substantial
cost effect;
(II) Extraordinary
circumstances, which are beyond the reasonable control of the ICF/IID and are
not a product or result of the negligence or malfeasance of the ICF/IID,
include:
(a) Unavoidable acts of nature are
natural wildfire, earthquakes, hurricane, tornado, lightning, flooding, or
other natural disasters for which no one can be held responsible, that are not
covered by insurance and that occur in a federally declared disaster area;
or
(b) Vandalism, civil disorder,
or both that are not covered by insurance; or
(c) Replacement of capital depreciable items
not built into existing rates that are the result of circumstances not related
to normal wear and tear or upgrading of existing system;
C. When an adjustment is based on
an Administrative Hearing Commission or court decision;
D. New, expanded, or terminated services may
be subject to rate review;
E.
Disallowance of federal financial participation; and
F. The following will not be subject to
review:
(I) The negotiated trend
factor;
(II) The use of prospective
reimbursement rate; and
(III) The
cost base for the per diem rates except as specified in this rule.
(5) Covered Services and Supplies.
(A) ICF/IID
services and supplies covered by the per diem reimbursement rate under this
plan, and which the ICF/IID must provide, as required by federal or state law
or rule and include, among other services, the regular room, dietary and
nursing services, or any other services that are required for standards of
participation or certification. Also included are minor medical and surgical
supplies and the use of equipment and facilities. These items include, but are
not limited to, the following:
1. All general
nursing services including, but not limited to, administration of oxygen and
related medications, hand-feeding, incontinency care, tray service, and
enemas;
2. Items that are furnished
routinely and relatively uniformly to all participants, for example, gowns,
water pitchers, soap, basins, and bed pans;
3. Items such as alcohol, applicators, cotton
balls, bandaids, and tongue depressors;
4. All nonlegend antacids, nonlegend
laxatives, nonlegend stool softeners, and nonlegend vitamins. Any nonlegend
drug in one (1) of these four (4) categories must be provided to residents as
needed and no additional charge may be made to any party for any of these
drugs. Facilities may not elect which nonlegend drugs in any of the four (4)
categories to supply; facilities must provide all as needed within the existing
per diem rate;
5. Items which are
utilized by individual participants but which are reusable and expected to be
available, such as ice bags, bed rails, canes, crutches, walkers, wheelchairs,
traction equipment, and other durable, nondepreciable medical
equipment;
6. Additional items as
specified in the appendix to this plan when required by the patient;
7. Special dietary supplements used for tube
feeding or oral feeding, such as elemental high nitrogen diet, including
dietary supplements written as a prescription item by a physician;
8. All laundry services except personal
laundry, which is a non-covered service;
9. All general personal care services that
the facility furnishes routinely and relatively uniformly to all participants
for their personal cleanliness and appearance shall be covered services, for
example, necessary clipping and cleaning of fingernails and toenails, basic
hair care, shampoos, and shaves to the extent necessary for reasonable personal
hygiene. The provider shall not bill the patient or his/her responsible party
for this type of personal service;
10. All consultative services as required by
state or federal law or regulation or for proper operation by the provider.
Contracts for the purchase of these services must accompany the provider cost
report. Failure to do so will result in the penalties specified in section (8)
of this rule;
11. Semiprivate room
and board and private room and board when necessary to isolate a participant
due to a medical or social condition, such as contagious infection, irrational
loud speech, and the like. Unless a private room is necessary due to a medical
or social condition, a private room is a noncovered service, and a MO HealthNet
participant or responsible party may therefore pay the difference between a
facility's semiprivate charge and its charge for a private room. MO HealthNet
participants may not be placed in private rooms and charged any additional
amount above the facility's MO HealthNet per diem unless the participant or
responsible party in writing specifically requests a private room prior to
placement in a private room and acknowledges that an additional amount not
payable by MO HealthNet will be charged for a private room;
12. Twelve (12) days per any period of six
(6) consecutive months during which a participant is on a temporary leave of
absence from the facility. The provider shall specifically provide for
temporary leave of absence days in the participant's plan of care. Periods of
time during which a participant is away from the facility because s/he is
visiting a friend or relative are considered temporary leaves of absence;
and
13. Days when participants are
away from the facility overnight on facility-sponsored group trips under the
continuing supervision and care of facility personnel.
(6) Allowable Cost Areas.
(A) Compensation of Owners.
1. Allowance of compensation of services of
owners shall be an allowable cost area, provided the owner actually performs
the services and the services are necessary.
2. "Compensation" means the total benefit to
the owner, within the limitations set forth in this rule, of the services s/he
renders to the facility. Compensation includes direct payments to the owner for
managerial, administrative, professional, and other services; amounts paid by
the provider for the personal benefit of the owner; the cost of assets and
services that the owner receives from the provider; and additional amounts
determined to be the reasonable value of the services rendered by sole
proprietors or partners and not paid by any method previously
described.
3. MO HealthNet auditors
may determine the reasonableness of compensation by reference to or in
comparison with compensation paid for comparable institutions or it may be
determined by other appropriate means such as the Medicare and Medicaid
Provider Reimbursement Manual (HIM-15) or by other means.
4. Necessary services refers to those
services that are pertinent to the operation and sound conduct of the facility,
had the provider not rendered these services, then employment of another
person(s) to perform the service would be necessary.
(B) Covered services and supplies as defined
in section (5) of this rule.
(C)
Depreciation.
1. An appropriate allowance for
depreciation on buildings, furnishings, and equipment that are part of the
operation and sound conduct of the provider's business is an allowable cost
item. Finder's fees are not an allowable cost item.
2. The depreciation must be identifiable and
recorded in the provider's accounting records, based on the basis of the asset
and prorated over the estimated useful life of the asset using the
straight-line method of depreciation from the date initially put into
service.
3. The basis of assets at
the time placed in service shall be the lower of-
A. The book value of the provider;
B. Fair market value at the time of
acquisition;
C. The recognized
Internal Revenue Service (IRS) tax basis; and
D. In the case of the change in ownership,
the cost basis of acquired assets of the owner of record on or after July 18,
1984, as of the effective date of the change of ownership; or in the case of a
facility which entered the program after July 18, 1984, the owner at the time
of the initial entry into the MO HealthNet program.
4. The MO HealthNet Division will allow the
basis of donated assets to the extent of the recognized income resulting from
the donation of the asset. Should a dispute arise between a provider and the
Department of Social Services as to the fair market value at the time of
acquisition of a depreciable asset and an appraisal by a third party is
required, the appraisal cost will be shared proportionately by the MO HealthNet
program and the facility in ratio to MO HealthNet participant reimbursable
patient days to total patient days.
5. Allowable methods of depreciation shall be
limited to the straight-line method. The depreciation method used for an asset
under the MO HealthNet program need not correspond to the method used by a
provider for non-MO HealthNet purposes; however, useful life shall be in
accordance with the American Hospital Association's Guidelines. Component part
depreciation is optional and allowable under this plan.
6. "Historical cost" means the cost incurred
by the provider in acquiring the asset and preparing it for use, except as
provided in this rule. Usually, historical cost includes costs that would be
capitalized under generally accepted accounting principles. For example, in
addition to the purchase price, historical cost would include architectural
fees and related legal fees. Where a provider has elected, for federal income
tax purposes, to expense certain items such as interest and taxes during
construction, the historical cost basis for MO HealthNet depreciation purposes
may include the amount of these expensed items. However, where a provider did
not capitalize these costs and has written off the costs in the year they were
incurred, the provider cannot retroactively capitalize any part of these costs
under the program. For Title XIX purposes and this rule, any asset costing less
than five hundred dollars ($500) or having a useful life of one (1) year or
less, may be expensed and not capitalized at the option of the provider, or in
the case of a facility which entered the program after July 18, 1984, the owner
at the time of the initial entry into the MO HealthNet program.
7. When an asset is acquired by trading in an
existing asset, the cost basis of the new asset shall be the sum of the
undepreciated cost basis of the traded asset plus the cash paid.
8. For the purpose of determining allowance
for depreciation, the cost basis of the asset shall be as prescribed in
paragraph (6)(C)3.
9. Capital
expenditures for building construction or for renovation costs which are in
excess of one hundred fifty thousand dollars ($150,000) and which cause an
increase in a provider's bed capacity shall not be allowed in the program or
depreciation base if these capital expenditures fail to comply with any other
federal or state law or regulation, such as Certificate of Need
(CON).
10. Amortization of
leasehold rights and related interest and finance costs shall not be allowable
costs under this plan.
(D) Interest and Finance Costs.
1. Necessary and proper interest on both
current and capital indebtedness shall be an allowable cost item excluding
finder's fees.
2. Interest is the
cost incurred for the use of borrowed funds. Interest on current indebtedness
is the cost incurred for funds borrowed for a relatively short term. This is
usually for those purposes as working capital for normal operating expenses.
Interest on capital indebtedness is the cost incurred for funds borrowed for
capital purposes, such as the acquisition of facilities and capital
improvements, and this indebtedness must be amortized over the life of the
loan.
3. Interest may be included
in finance charges imposed by some lending institutions or it may be a prepaid
cost or discount in transactions with those lenders who collect the full
interest charges when funds are borrowed.
4. To be an allowable cost item, interest
(including finance charges, prepaid costs, and discounts) must be supported by
evidence of an agreement that funds were borrowed and that payment of interest
and repayment of the funds are required, identifiable in the provider's
accounting records, relating to the reporting period in which the costs are
claims, and necessary and proper for the operation, maintenance, or acquisition
of the provider's facilities.
5.
Necessary means that the interest be incurred for a loan made to satisfy a
financial need of the provider and for a purpose related to participant care.
Loans that result in excess funds or investments are not considered
necessary.
6. Proper means that the
interest be incurred at a rate not in excess of what a prudent borrower would
have had to pay in the money market existing at the time the loan was made, and
provided further the department shall not reimburse for interest and finance
charges any amount in excess of the prime rate current at the time the loan was
obtained.
7. Interest on loans to
providers by proprietors, partners, and any stockholders shall not be an
allowable cost item because the loans shall be treated as invested capital and
included in the computation of an allowable return on owner's net equity. If a
facility operated by a religious order borrows from the order, interest paid to
the order shall be an allowable cost.
8. If loans for capital indebtedness exceed
the asset cost basis as defined in subsection (6)(C) of this rule, the interest
associated with the portion of the loan(s) which exceed the asset cost basis as
defined in subsection (6)(C) of this rule shall not be allowable.
9. Income from a provider's qualified
retirement fund shall be excluded in consideration of the per diem
rate.
10. A provider shall amortize
finance charges, prepaid interest, and discount over the period of the loan
ratably or by means of the constant rate of interest method on the unpaid
balance.
11. Usual and customary
costs, excluding finder's fees, incurred to obtain loans shall be treated as
interest expense and shall be allowable costs over the loan period ratably or
by means of the constant interest applied method.
12. Usual and customary costs shall be
limited to the lender's title and recording fees, appraisal fees, legal fees,
escrow fees, and closing costs.
13.
Interest expense resultant from capital expenditures for building construction
or for renovation costs which are in excess of one hundred fifty thousand
dollars ($150,000) and which cause an increase in a bed capacity by the
provider shall not be an allowable cost item if the capital expenditure fails
to comply with other federal or state law or rules such as CON.
(E) Rental and Leases.
1. Rental and leases of land, buildings,
furnishings, and equipment are allowable cost areas if the rented items are
necessary and not in essence a purchase of those assets. Finder's fees are not
an allowable cost item.
2.
Necessary rental and lease items are those that are pertinent to the economical
operation of the provider.
3. In
the case of related parties, rental and lease amounts cannot exceed the lesser
of those that are actually paid or the costs to the related party.
4. Determination of reasonable and adequate
reimbursement for rental and amounts, except in the case of related parties
that is subject to other provisions of this rule, may require affidavits of
competent, impartial experts who are familiar with the current rentals and
leases.
5. The test of necessary
costs shall take into account the agreement between the owner and the tenant
regarding the payment of related property costs.
6. Leases subject to CON approval must have
that approval before a rate is determined.
7. If rent or lease costs increase solely as
a result of change in ownership, the resulting increase which exceeds the
allowable capital cost of the owner of record as of July 18, 1984, or in the
case of a facility which entered the program after July 18, 1984, the owner at
the time of the initial entry into the MO HealthNet program, shall be a
nonallowable cost.
(F)
Taxes. Taxes levied on or incurred by providers shall be allowable cost areas
with the exceptions of the following items:
1. Federal, state, or local income and excess
profit taxes including any interest and penalties paid;
2. Taxes in connection with financing,
refinancing, or refunding operations, such as taxes on the issuance of bond,
property transfer, issuance of transfer of stocks;
3. Taxes for which exemptions are available
to the provider;
4. Special
assessments on land that represent capital improvements. These costs shall be
capitalized and depreciated over the period during which the assessment is
scheduled to be paid;
5. Taxes on
property which are not a part of the operation of the provider;
6. Taxes which are levied against a resident
and collected and remitted by the provider; and
7. Self-employment Federal Insurance
Contributions Act (FICA) taxes applicable to individual proprietors, partners,
or members of a joint venture to the extent the taxes exceed the amount which
would have been paid by the provider on the allowable compensation of the
persons had the provider organization been an incorporated rather than
unincorporated entity.
(G) Issuance of Revenue Bond and Tax Levies
by District and County Facilities. Those nursing home districts and county
facilities whose funding is through the issuance of revenue bonds, that
interest which is paid per the revenue bond will be an allowable cost item.
Depreciation on the plant and equipment of these facilities also shall be an
allowable cost item. Any tax levies which are collected by nursing home
districts or county homes that are supported in whole or in part by these
levies will not be recognized as a revenue offset except to the extent that the
funds are used for the actual operation of the facility.
(H) Value of Services of Employees.
1. Except as provided for in this rule, the
value of services performed by employees in the facility shall be included as
an allowable cost area to the extent actually compensated, either to the
employee or to the supplying organization.
2. Services rendered by volunteers, such as
those affiliated with the American Red Cross, hospital guilds, auxiliaries,
private individuals, and similar organizations, shall not be included as an
allowable cost area, as the services have traditionally been rendered on a
purely volunteer basis without expectation of any form of reimbursement by the
organization through which the service is rendered or by the person rendering
the service.
3. Services by
priests, ministers, rabbis, and similar type professionals shall be an
allowable cost area; provided, that the services are not of a religious nature.
An example of an allowable cost area under this section would be a necessary
administrative function performed by a clergyman. The state will not recognize
building costs on space set aside primarily for professionals providing any
religious function. The MO HealthNet Division considers costs for wardrobe and
similar items likewise nonallowable.
(I) Fringe Benefits.
1. Life insurance.
A. Types of insurance that the MO HealthNet
Division does not consider an allowable cost area; premiums related to
insurance on the lives of officers and key employees are not allowable cost
areas under the following circumstances:
(I)
Where, upon the death of an insured officer or key employee, the insurance
proceeds are payable directly to the provider. In this case, the provider is a
direct beneficiary. Insurance of this type is referred to as key-man insurance;
and
(II) Where insurance on the
lives of officers is voluntarily taken out as part of a mortgage loan agreement
entered into for building construction and, upon the death of an insured
officer, the proceeds are payable directly to the lending institution as a
credit against the loan balance. In this case, the provider is an indirect
beneficiary.
B. Types of
insurance which are considered an allowable cost area-
(I) Where credit life insurance is required
as part of a mortgage loan agreement. An example would be insurance on loans
granted under certain federal programs; and
(II) Where the relative(s) or estate of the
employee, excluding stockholders, partners and proprietors, is the beneficiary.
The MO HealthNet Division considers this type of insurance a fringe benefit and
is an allowable cost area to the extent that the amount of coverage is
reasonable.
2.
Retirement plans.
A. Contributions to
qualified retirement plans for the benefit of employees excluding stockholders,
partners, and proprietors of the provider shall be allowable cost areas.
Facilities shall exclude interest income from funded pensions or retirement
plans from consideration in determining the allowable cost area.
B. Amounts funded to pension and retirement
plans, together with associated income, shall be recaptured if not actually
paid when due, as an offset to expenses on the cost report form.
3. Deferred compensation plans.
A. Contributions for the benefit of
employees, excluding stockholders, partners, and proprietors, under deferred
compensation plans shall be all allowable cost areas when, and to the extent
that, the costs are actually paid by the provider. Deferred compensation plans
must be funded. Provider payments under unfunded deferred compensation plans
will be considered as an allowable cost area only when paid to the
participating employee and only to the extent considered reasonable.
B. Amounts paid by tax-exempt organizations
to purchase tax-sheltered annuities for employees shall be treated as deferred
compensation actually paid by the provider.
C. Amounts funded to deferred compensation
plans, together with associated income if not actually paid when due, as an
offset to expenses on the cost report form.
(J) Education and Training Expenses.
1. The cost of on-the-job training that
directly benefits the quality of health care or administration at the facility
shall be allowable. Off-the-job training involving extended periods exceeding
five (5) continuous days is an allowable cost item only when specifically
authorized in advance by the department.
2. Cost of education and training shall
include incidental travel costs, but will not include leaves of absence or
sabbaticals.
(K)
Organizational Cost Items.
1. Organizational
cost items may be included as an allowable cost area on an amortized
basis.
2. Organizational cost items
include the following: legal fees incurred in establishing the corporation or
other organizations, necessary accounting fees, expenses of temporary
directors, and organizational meetings of directors and stockholders, and fees
paid to states of incorporation.
3.
The provider shall amortize organizational costs ratably over a period of sixty
(60) months beginning with the date of organization. When the provider enters
the program more than sixty (60) months after the date of organization, no
organizational costs shall be recognized.
4. Where a provider did not capitalize
organizational costs and has written off those costs in the year they were
incurred, the provider cannot retroactively capitalize any part of these costs
under the program.
5. Where a
provider is organized within a five- (5-) year period prior to entering the
program and has properly capitalized organizational costs using a sixty- (60-)
month amortization period, no change in the rate of amortization is required.
In this instance the unamortized portion of organizational costs is an
allowable cost area under the program and shall be amortized over the remaining
part of the sixty- (60-) month period.
6. For change in ownership after July 18,
1984, allowable amortization will be limited to the prior owner's allowable
unamortized portion of organizational cost.
(L) Advertising Costs. Advertising costs that
are reasonable, appropriate, and helpful in developing, maintaining, and
furnishing services shall be an allowable cost area. The costs must be common
and accepted occurrence in the field of the activity of the provider.
(M) Cost of Suppliers Involving Related
Parties. Costs applicable to facilities, goods, and services furnished to a
provider by a supplier related to the provider shall not exceed the lower of
the cost to the supplier or the prices of comparable facilities, goods, or
services obtained elsewhere. A provider shall identify suppliers related to it
in the uniform cost report and the type-quantity and costs of facilities,
goods, and services obtained from each supplier.
(N) Utilization Review. Incurred cost for the
performance of required utilization review for ICF/IID is an allowable cost
area. The expenditures must be for providing utilization review on behalf of a
Title XIX participant. The provider shall apportion utilization review costs
incurred for Title XVIII and Title XIX based on reimbursable participant days
recorded for each program during the reporting period.
(O) Minimum Utilization. In the event the
occupancy of a provider is below ninety percent (90%), the provider will
calculate the following cost centers as if the provider experienced ninety
percent (90%) occupancy: laundry, housekeeping, general, administrative, and
plant operation costs. In no case may the provider carry forward costs
disallowed under this provision to succeeding periods.
(P) Nonreimbursable Costs.
1. Bad debts, charity, and courtesy
allowances are deductions from revenue and are not to be included as allowable
costs.
2. Those services that are
specifically provided by Medicare and MO HealthNet must be billed to those
agencies.
3. Any costs incurred
that are related to fund drives are not reimbursable.
4. Costs incurred for research purposes shall
not be included as allowable costs.
5. The cost of services provided under the
Title XX program, by contract or subcontract, is specifically excluded as an
allowable item.
6. Attorney fees
related to litigation involving state, local, or federal governmental entities
and attorneys' fees which are not related to the provision of LTC services,
such as litigation related to disputes between or among owners, operators, or
administrators.
7. Costs, such as
legal fees, accounting and administration costs, travel costs, and the costs of
feasibility studies, which are attributable to the negotiation or settlement of
the sale or purchase of any capital asset by acquisition of merger for which
any payment has been previously made under the program.
(Q) Other Revenues. Other revenues, including
those listed that follow and excluding amounts collected under paragraph
(5)(A)8. will be deducted from the total allowable cost and must be shown
separately in the cost report by use of a separate schedule if included in the
gross revenue: income from telephone services; sale of employee and guest
meals; sale of medical abstracts; sale of scrap and waste food or materials;
rental income; cash, trade, quantity time, and other discounts; purchase
rebates and refunds; recovery on insured loss; parking lot revenues; vending
machine commissions or profit; sales from drugs to other than participants;
income from investments of whatever type; and room reservation charges for
temporary leave of absence days which are not covered services under section
(5) of this rule. Failure by the provider to, in a readily ascertainable
manner, separately account for any of the revenues specifically set out
previously in this rule, shall result in the provider's termination from the
program.
1. Interest income received from a
funded depreciation account will not be deducted from allowable operating costs
if interest is applied to the replacement of the asset being
depreciated.
2. Cost centers or
operations specified by the provider in subsection (6)(R) of this rule shall
not have their associated cost or revenues included in the covered costs or
revenues of the facility.
3.
Restricted and unrestricted funds.
A.
"Restricted funds," as used in this rule, mean those funds, cash or otherwise,
including grants, gifts, taxes, and income from endowments, which the provider
shall only use for a specific purpose designated by the donor. Those restricted
funds that are not transferred funds and are designated by the donor for paying
operating costs will be offset from the total allowable expenses. If an
administrative body has the authority to re-restrict restricted funds
designated by the donor for paying operating costs, the provider will not
offset the funds from the total allowable expenses.
B. "Unrestricted funds," as used in this
rule, mean those funds, cash or otherwise, including grants, gifts, taxes, and
income from endowments, that a donor gives to a provider without restriction as
to their use. The provider can use these funds in any manner. However, those
unrestricted funds that are not transferred funds and that the provider uses to
pay operating costs will be offset from total allowable expenses.
C. Transferred funds, as used in this rule,
are those funds appropriated through a legislative or governmental
administrative body's action, state or local, to a state or local government
provider. The transfer can be state-to-state, state-to-local, or local-to-local
provider. The MO HealthNet Division does not consider these funds a grant or
gift for reimbursement purposes, so have no effect on the provider's allowable
cost under this plan.
(R) Apportionment of Costs to MO HealthNet
Participant Residents.
1. Providers shall
apportion their allowable cost areas between MO HealthNet program participant
residents and other residents so that the share of allowable cost areas borne
by the MO HealthNet program is based upon actual services received by MO
HealthNet program participants.
2.
To accomplish this apportionment, providers shall apply the ratio of patient
days for MO HealthNet participants to the total patient days.
3. Average cost per diem for general routine
services means the amount computed by dividing the total allowable patient
costs for routine services by the total number of patient days of care rendered
by the provider in the cost-reporting period.
4. A patient day of care is that period of
service rendered a patient between the census-taking hours on two (2)
consecutive days, including the twelve (12) temporary leave of absence days per
any period of six (6) consecutive months as specifically covered under section
(5) of this rule, the day of discharge being counted only when the patient was
admitted the same day. The provider shall maintain a census log in the facility
for documentation purposes. Census shall be taken daily at midnight. A day of
care includes those overnight periods when a participant is away from the
facility on a facility-sponsored group trip and remains under the supervision
and care of facility personnel.
5.
ICF/IID facilities that provide intermediate care services to MO HealthNet
participants may establish distinct part cost centers in their facility
provided that adequate accounting and statistical data required to separately
determine the nursing care cost of each distinct part is maintained. Each
distinct part may share the common services and facilities, such as management
services, dietary, housekeeping, building maintenance, and laundry.
6. In no case may a provider's allowable
costs allocated to the MO HealthNet program include the cost of furnishing
services to persons not covered under the MO HealthNet program.
(S) Return on Equity.
1. A return on a provider's net equity shall
be an allowable cost area.
2. The
amount of return on a provider's net equity shall be calculated using the
nursing home allowable percentage as defined in
13 CSR
70-10.015 Prospective Reimbursement Plan for Nursing
Facility Services.
3. An owner's
net equity is comprised of investment capital and working capital. Investment
capital includes the investment in building, property, and equipment (cost of
land, mortgage payments toward principle, and equipment purchase less the
accumulative depreciation). Working capital represents the amount of capital
that is required to ensure proper operation of the facility.
4. The return on owner's net equity shall be
payable only to proprietary providers.
5. The provider shall apportion its return on
the owner's net equity to the MO HealthNet program based on the provider's MO
HealthNet program reimbursable participant resident days of care to total
resident days of care during the cost-reporting period. For the purpose of this
calculation, total resident days of care shall be the greater of ninety percent
(90%) of the provider's certified bed capacity or actual occupancy during the
cost year.
(T)
Intermediate Care Facility for Individuals with Intellectual Disabilities
Federal Reimbursement Allowance (ICF/IID FRA). The fee assessed to ICF/IIDs in
the state of Missouri for the privilege of doing business in the state will be
an allowable cost.
(7) Reporting Requirements.
(A) Annual Cost
Report.
1. Each provider shall establish a
twelve- (12-) month fiscal period which is to be designated as the provider's
fiscal year. The provider shall submit an annual cost report for the fiscal
year to the department on forms to be furnished by the department for that
purpose. Each provider shall submit the completed cost report by the first day
of the sixth month following the close of the fiscal period.
2. Unless the provider has previously filed
adequate and current documentation in the following areas with the department,
authenticated copies of the following documents must be submitted by the
provider with the cost reports: authenticated copies of all leases related to
the activities of the facility; all management contracts, all contracts with
consultants; federal and state income tax returns for the fiscal year; and
documentation of expenditures, by line item, made under all restricted and
unrestricted grants. For restricted grants, a statement verifying the
restriction as specified by the donor.
3. The facility shall maintain adequate
documentation for all line items on the uniform cost reports and must submit
the document to the department upon request.
4. If a cost report is more than ten (10)
days past due, payment may be withheld from the facility until the cost report
is submitted. Upon receipt of a cost report prepared in accordance with this
regulation, the department will release the withheld payments to the provider.
For cost reports which are more than ninety (90) days past due, the department
may terminate the provider's MO HealthNet participation agreement and if
terminated, retain all payments which have been withheld pursuant to this
provision.
5. If a provider
notifies, in writing, the director of the Institutional Reimbursement Unit of
the division prior to the change of control, ownership, or termination of
participation in the MO HealthNet program, the division may withhold all
remaining payments from the selling provider until the provider files the cost
report. The fully completed cost report with all required attachments and
documentation is due the first day of the sixth month after the date of change
of control, ownership, or termination. Upon receipt of a cost report prepared
in accordance with this regulation, the department will release any withheld
payment to the selling provider.
(B) Certification of Cost Reports.
1. The facility must certify the accuracy and
validity of any cost report. Certification must be made by one (1) of the
following persons (who must be authorized by the governing body of the facility
to make the certification and will furnish proof of the authorization): an
incorporated entity, an officer of the corporation; for a partnership, a
partner; for a sole proprietorship or sole owner, the owner; or for a public
facility, the chief administrative officer of the facility. The cost report
must also be notarized by a licensed notary public.
2. Certification statement.
Form of Certification
Misrepresentation or falsifications of any information contained in this report may be punishable by fine, imprisonment, or both, under state or federal law.
Certification by officer or administrator of provider: I hereby certify that I have read the above statement and that I have examined the accompanying cost report and supporting schedules prepared by __________________
____________________________________
(Provider's name(s) and number(s)) for the cost report period beginning, _________________, 20 ______ and ending _________________, 20 _____, and that to the best of my knowledge and belief, it is a true, correct, and complete statement prepared from the books and records of the provider in accordance with applicable instructions, except as noted.
______________ __________ __________
(Signature) (Title) (Date)
(C) Adequacy of Records.
1. The provider must make available to the
department or its duly authorized agent, including federal agents from Health
and Human Services (HHS), at all reasonable times, the records as are necessary
to permit review and audit of provider's cost reports. Failure to do so may
lead to sanctions available in section (8) of this rule.
2. The provider shall retain all records
associated with the preparation and documentation of the data associated with
the cost report for seven (7) years from the cost report filing date.
(D) Accounting Basis.
1. The provider shall base the submitted cost
report on the accrual basis of accounting.
2. Governmental institutions that operate on
a cash or modified cash basis of accounting may continue to use those methods,
provided the governmental institution treats capital expenditures
appropriately.
(E)
Audits.
1. The provider shall base cost
reports upon the provider's financial and statistical records that must be
capable of verification by audit.
2. If the provider has included the cost of a
certified audit of the facility as an allowable cost item to the plan, a copy
of that audit report and accompanying letter shall be submitted without
deletions.
3. The annual cost
report for the fiscal year of the provider may be subject to audit by the
Department of Social Services or its contracted agents. Twelve- (12-) month
cost reports for new construction facilities required to be submitted under
section (4) of this rule may be audited by the department or its contracted
agents prior to establishment of a permanent rate.
4. The department or authorized agent will
conduct a desk review of all cost reports after submission by the provider and
shall provide for on-site audits of facilities wherever their personnel notes a
cost variance or exception.
5. The
department shall retain the annual cost report and any working papers relating
to the audits of those cost reports for a period of not less than seven (7)
full years from the date of submission of the report or completion of the
audit.
6. Those providers having an
annual Title XIX bed-day ratio on total bed days or certified beds of greater
than sixty percent (60%) or an annual Title XIX payment of two hundred thousand
dollars ($200,000) or more, or both, shall be required, for at least the first
two (2) fiscal years of participation in the plan, to have an annual audit of
their financial records by an independent certified public accountant. The
auditor may issue a qualified audit report stating that confirmations of
accounts receivable and accounts payable are not required by the plan. For the
purposes of the paragraph, the Department of Social Services will accept
unqualified opinions only if they are from a certified public accounting firm.
A copy of the audit report must be submitted to the department to support the
annual cost report of the facility.
(8) Sanctions and Overpayments.
(A) The department may impose sanctions
against a provider in accordance with
13 CSR
70-3.030 and other federal or state statutes and
regulations.
(B) In the case of
overpayments to providers based on, but not limited to, field or audit findings
or determinations based on a comprehensive operational review of the facility,
the provider shall repay the overpayment in accordance with the provisions as
set forth in 13 CSR 70-3.030.
(9) Exceptions.
(A) For those MO HealthNet-eligible
participant-patients who have concurrent Medicare Part A skilled nursing
facilities benefits available, MO HealthNet reimbursement for covered days of
stay in a qualified facility will be based on the coinsurance as may be imposed
under the Medicare Program.
(B) The
Title XIX reimbursement rate for out-of-state providers shall be set by one (1)
of the following methods:
1. For providers
which provided prior authorized services of fewer than one thousand (1,000)
patient days for Missouri Title XIX participants, the reimbursement rate shall
be the rate paid for comparable services and level-of-care by the state in
which the provider is located; and
2. For providers that provide prior
authorized services of one thousand (1,000) or more patient days for Missouri
Title XIX participants, the reimbursement rate shall be the lower of-
A. The rate paid for comparable services and
level-of-care by the state in which the provider is located; or
B. The rate calculated in section (4) of this
rule.
(10) Payment Assurance.
(A) The state will pay each provider, which
furnished the services in accordance with the requirements of the state plan,
the amount determined for services furnished by the provider according to the
standards and methods set forth in these rules.
(B) Where third-party payment is involved, MO
HealthNet will be the payor of last resort with the exception of state programs
such as Vocational Rehabilitation and the Missouri Crippled Children's Service.
Procedures for remitting third-party payments are provided in the MO HealthNet
program provider manuals.
(11) Provider Participation. Payments made in accordance with the standards and methods described in this rule are designed to enlist participation of a sufficient number of providers in the program so that eligible persons can receive medical care and services included in the state plan at least to the extent these services are available to the general public.
(12) Payment in Full. Participation in the program shall be limited to providers who accept as payment in full for covered services rendered to MO HealthNet participants, the amount paid in accordance with these rules and applicable copayments.
(13) Plan Evaluation. The provider will maintain documentation to effectively monitor and evaluate experience during administration of this rule.
Disclaimer: These regulations may not be the most recent version. Missouri may have more current or accurate information. We make no warranties or guarantees about the accuracy, completeness, or adequacy of the information contained on this site or the information linked to on the state site. Please check official sources.
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