NOTICES
DEPARTMENT OF
PUBLIC WELFARE
Nursing Facility Assessment Program for Fiscal Year 2010-2011
[40 Pa.B. 7297]
[Saturday, December 18, 2010]This notice announces the amount of the assessment that the Department of Public Welfare (Department) is implementing for Fiscal Year (FY) 2010-2011, provides an explanation of the assessment methodology that the Department is using in FY 2010-2011 and identifies the estimated aggregate impact on nursing facilities which will be subject to the assessment.
Background
Article VIII-A of the Public Welfare Code authorizes the Department to impose an annual monetary assessment on private and county nursing facilities in this Commonwealth each fiscal year through FY 2011-2012. See 62 P. S. §§ 801-A—815-A. Under Article VIII-A, the Department may impose the assessment only to the extent that the assessment revenues qualify as the State share of Medical Assistance (MA) Program expenditures eligible for Federal financial participation (FFP). See 62 P. S. § 803-A. To ensure receipt of FFP, Article VIII-A requires the Department to seek a waiver from the Centers for Medicare and Medicaid Services (CMS) if necessary to implement the Nursing Facility Assessment Program. See 62 P. S. § 812-A.
For each fiscal year that the Assessment Program is implemented, the law authorizes the Secretary of Department (Secretary) to determine the aggregate amount of the assessment and the annual assessment rate in consultation with the Secretary of the Budget. See 62 P. S. § 804-A. The law specifies that annual assessment rates must be sufficient to generate at least $50 million in additional revenue, but not more than the maximum aggregate assessment amount that qualifies for Federal matching funds. See 62 P. S. § 805-A.
The Secretary must publish a notice in the Pennsylvania Bulletin before imposing an annual assessment for a fiscal year. The notice must specify the amount of the assessment being proposed, explain the proposed assessment methodology, identify the estimated assessment amount and aggregate impact on nursing facilities subject to the assessment and provide interested persons a 30-day period to comment. See 62 P. S. § 805-A.
After consideration of any comments received during the 30-day comment period, the Secretary must publish a second notice announcing the rate of assessment for the fiscal year. See 62 P. S. § 805-A. The annual aggregate assessment amount and assessment rate for the fiscal year must be approved by the Governor. See 62 P. S. § 804-A.
In compliance with these requirements, the Secretary published a notice in the Pennsylvania Bulletin at 40 Pa.B. 3026 (June 5, 2010) announcing the proposed assessment rates and the estimated aggregate amount and the impact for FY 2010-2011. The notice published at 40 Pa.B. 3026 also described the assessment methodology that the Department intended to use in FY 2010-2011:
Under the proposed rate structure, the Department will assess nonexempt nursing facilities at two rates. One rate will apply to 3 categories of nursing facilities: county nursing facilities; nursing facilities that have 50 or fewer licensed beds; and nursing facilities that participated in a continuing care retirement community (CCRC) before July 1, 2010, and that continue to participate within that CCRC. The other rate will apply to all other nonexempt facilities, including nursing facilities that begin participation in a CCRC on or after July 1, 2010.
The Department announced at 40 Pa.B. 3026 that it would continue to accept requests to be assessed at the CCRC rate until June 23, 2010, the Department proposed to increase the two assessment rates for FY 2010-2011 by $.50 from the rates in effect for the prior fiscal year.
The Department received three comments in response to the notice published at 40 Pa.B. 3026. All three comments related to the Department's proposal to assess new CCRC facilities at the higher assessment rate. The Department considered those comments in developing the following final assessment methodology.
Nursing facilities participating in CCRCs
In the notice published at 40 Pa.B. 3026, the Department proposed to limit application of the CCRC assessment rate to nursing facilities that participated in a CCRC prior to July 1, 2010. The Department is adopting this change. In FY 2010-2011, the assessment rate that is imposed on a nursing facility participating in a CCRC depends on whether the nursing facility is considered a ''grandfathered CCRC nursing facility.'' As specified below, a grandfathered CCRC nursing facility will be assessed at a rate of $4.05 per non-Medicare resident day. All other CCRC nursing facilities will be assessed at a rate of $25.50 per non-Medicare resident day.
Upon consideration of the comments received in response to the notice published at 40 Pa.B. 3026, the Department is refining the conditions under which a nursing facility will be assessed as a grandfathered CCRC nursing facility. The Department will consider a nursing facility to be a grandfathered CCRC nursing facility if it meets either of the following:
(1) The nursing facility was assessed the CCRC assessment rate prior to July 1, 2010, and continues to qualify for the CCRC assessment rate under the guidelines under which it was approved for the CCRC rate.
(2) The nursing facility was not assessed at the CCRC assessment rate prior to July 1, 2010, but the nursing facility meets all of the following:
(i) The nursing facility submitted a request to the Department to be assessed at the CCRC rate on or before June 23, 2010.
(ii) The CCRC which controls or owns the nursing facility submitted an application for a certificate of authority (COA) to the Insurance Department on or before June 23, 2010.
(iii) The nursing facility demonstrates that the CCRC incurred significant costs prior to June 5, 2010, in pursuing certification as a CCRC. (Examples of significant costs include costs incurred to obtain plan or site reviews, an enforceable construction contract, lease, contract for consulting services, zoning and certificate of occupancy.)
(iv) The nursing facility qualifies for the CCRC rate under the criteria in effect for FY 2009-2010 published at 40 Pa.B. 767 (February 6, 2010).
(v) The CCRC receives a COA during FY 2010-2011.
A nursing facility that qualifies as a grandfathered CCRC nursing facility under the conditions in (2) will be assessed at the CCRC rate beginning the quarter following the date that all of the criteria in effect for FY 2009-2010 are satisfied.
The Department will require nursing facilities that qualify for the CCRC rate to certify, upon written request, that they continue to qualify for the CCRC assessment rate under the guidelines under which they were approved.
Assessment Methodology and Rates for FY 2010-2011
The following nursing facilities will continue to be exempt from the Assessment Program in FY 2010-2011:
(1) State owned and operated nursing facilities.
(2) Veteran's Administration nursing facilities.
(3) Nursing facilities that have not been licensed and operated by the current or previous owner for the full calendar quarter prior to the calendar quarter in which an assessment is collected.
(4) Nursing facilities that provide nursing facility services free of charge to all residents.
The Department will assess nonexempt nursing facilities at two rates. One rate will apply to 3 categories of nursing facilities: county nursing facilities; nursing facilities that have 50 or fewer licensed beds; and grandfathered CCRC nursing facilities. The other rate will apply to all other nonexempt facilities, including nursing facilities that participate in a CCRC but do not qualify for the grandfathered CCRC nursing facility rate. Using the applicable rate, the Department will calculate each nonexempt facility's quarterly assessment amount by multiplying its assessment rate by the facility's non-Medicare resident days during the calendar quarter that immediately preceded the assessment quarter.
For FY 2010-2011, the assessment rates for nonexempt nursing facilities will be as follows:
(1) The assessment rate for county nursing facilities, for nursing facilities that have 50 or fewer licensed beds, and for grandfathered CCRC nursing facilities that have certified continued participation within that CCRC, will be $4.05 per non-Medicare resident day.
(2) The assessment rate for all other nonexempt nursing facilities will be $25.50 per non-Medicare resident day.
Assessment payments are due the last day of the Assessment quarter or 30 days after publication of this final notice, whichever is later.
The Assessment Program due dates, along with supplemental payment dates, will be available on the Department's web site at http://www.dpw.state.pa.us/provider/doingbusinesswithdpw/longtermcarecasemixinformation/index.htm.
Aggregate Assessment Amounts and Fiscal Impact
The Department estimates that the annual aggregate assessment fees for nonexempt nursing facilities will total $390.726 million. The Department will use the State revenue derived from the assessment fees and any associated Federal matching funds to make payments to qualified MA nursing facility providers in accordance with applicable law and regulations.
Approvals
As required under 62 P. S. § 804-A, the Governor approved the annual aggregate assessment amount and assessment rate for the fiscal year for FY 2010-2011 announced in this notice. Further, in compliance with 62 P. S. § 812-A, the Department submitted a request to the Centers for Medicare and Medicaid Services (CMS), seeking a waiver of both the uniform and broad-based requirements applicable to provider assessments to implement the Assessment Program in FY 2010-2011 as previously described. By letter dated August 18, 2010, CMS approved the Department's waiver request.
Public Comment
Interested persons are invited to submit written comments regarding the contents of this notice to Marilyn Yocum, Department of Public Welfare, Office of Long-Term Living, 555 Walnut Street, Forum Place, 5th Floor, Harrisburg, PA 17101-1919. Comments received within 30 days will be reviewed and considered for any subsequent revision of the notice.
Persons with a disability who require an auxiliary aid or service may submit comments using the Pennsylvania AT&T Relay Service at (800) 654-5984 (TDD users) or (800) 654-5988 (voice users).
MICHAEL P. NARDONE,
Acting SecretaryFiscal Note: 14-NOT-670. No fiscal impact; recommends adoption. Enactment of this notice is expected to generate $390.726 million in assessment fees and associated federal matching funds to support payments to qualified MA nursing facility providers.
[Pa.B. Doc. No. 10-2417. Filed for public inspection December 17, 2010, 9:00 a.m.]
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