Pennsylvania Code
Title 55 - HUMAN SERVICES
Part III - MEDICAL ASSISTANCE MANUAL
Chapter 1163 - INPATIENT HOSPITAL SERVICES
Subchapter B - HOSPITALS AND HOSPITAL UNITS UNDER COST REIMBURSEMENT PRINCIPLES
CHANGE OF OWNERSHIP
Section 1163.511 - Change of ownership or control
Universal Citation: 55 PA Code ยง 1163.511
Current through Register Vol. 54, No. 44, November 2, 2024
(a) A hospital or hospital unit is not entitled to additional reimbursement due solely to change of ownership or control.
(b) In the event of change of ownership, the Department will establish interim per diem rates as follows:
(1) If the change involves only one hospital
or unit, the Department will use the interim per diem rate assigned to the
entity before the change.
(2) If
the change combines two or more hospitals or units into a single entity, such
as a merger or consolidation, the Department will establish an interim per diem
rate for the new entity by averaging the rates of the previous entities on a
days-weighted basis. To determine that days-weighted average, the Department
will use the MA days of each previously enrolled entity as reported in the most
recent fiscal year for which the previous entities filed acceptable Cost
Reports (MA 336).
(3) If the change
divides one enrolled hospital or unit into two or more entities, the Department
will use the interim per diem rate assigned to the entity before the change,
for the resulting entities.
(c) In the event of change of ownership, the Department will establish final audited per diem rates based on the following ceilings:
(1) If the change involves only one
hospital or unit, the Department will use the ceiling for the entity existing
before the change.
(2) If the
change combines two or more hospitals or units into a single entity, such as a
merger or consolidation, the Department will establish a ceiling by averaging
the audited per diem rates of the previous entities on a days-weighted basis.
To determine that days-weighted average, the Department will use audited MA
days for the previous entities in the final full fiscal year of operation
before the change.
(3) If the
change divides one enrolled hospital or unit into two or more entities, the
ceiling assigned to the entity before the change is used for each resulting
entity.
(4) The Department will not
rebase ceilings established under this subsection until Statewide rebasing
occurs.
(5) If after a change of
ownership has occurred, the Department rebases ceilings Statewide, using a base
year which predates or corresponds to the year of the change, the Department
will use the Cost Report (MA 336) and the claims data for the base year
regardless of who owned the entity in that base year.
(d) In the event of change of ownership, the Department will establish disproportionate share payments as follows:
(1) If the change involves only one hospital
or unit, the Department will use the disproportionate share status assigned to
the entity before this change, so long as the resulting entity maintains the
nonemergency obstetric services by which the previous entity complied with
section 1923(d) of the Social Security Act (42 U.S.C.A. §
1396r-4(d)).
(2) If the change combines two or more
hospitals or units into a single entity, such as a merger or consolidation, the
Department will establish the new entity as eligible for disproportionate share
payments if one or more of the previous entities was eligible for
disproportionate share payments, so long as the resulting entity maintains the
nonemergency obstetric services by which one of the previous entities complied
with section 1923(d) of the Social Security Act. To determine the monthly
disproportionate share payment for the new entity, the Department will add the
monthly disproportionate share payments of the previous entities.
(3) If the change divides one enrolled
hospital or unit into two or more entities, the Department will use the
disproportionate share status assigned to the hospital or unit before the
change, so long as each of the resulting entities maintains the nonemergency
obstetric services by which the previous entity complied with section 1923(d)
of the Social Security Act. The Department will prorate the monthly
disproportionate share payment of the previous entity on the basis of ratio of
utilization agreed upon by the entities.
(4) The Department will not recalculate a
hospital's disproportionate share status established under this subsection
until it recalculates disproportionate share status Statewide.
(5) If the Department makes a Statewide
redetermination of disproportionate share status after a change of ownership
has occurred, and uses a base year which predates or corresponds to the year of
the change, the Department will use the cost reports for the base year,
regardless of who owned the entity in that base year.
(6) For a Statewide redetermination of
disproportionate share status, the determination of disproportionate share
status for the entities resulting from the division is made on the basis of
ratio of utilization for the base year as agreed upon by the
entities.
(e) A hospital that changes ownership or closes shall submit final Cost Reports (MA 336) to the Department within 45 days of the change of ownership or closure.
(f) This section applies only to hospitals and units which change ownership in the period July 1, 1993, through June 30, 1995.
The provisions of this §1163.511 issued under sections 201 and 443.1(1) of the Public Welfare Code (62 P. S. §§ 201 and 443.1(1)).
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