STATEMENTS OF POLICY
[ 55 PA. CODE CH. 1187 ]
Nursing Facility Services
[38 Pa.B. 5974]
[Saturday, November 1, 2008]Statutory Authority
The Department of Public Welfare (Department) under the authority of section 443.1(8) of the Public Welfare Code (code) (62 P. S. § 443.1(8)), intends to revise the statement of policy in 55 Pa. Code § 1187.21a (relating to nursing facility exception requests--statement of policy) as set forth in Annex A.
Scope
This proposed statement of policy applies to county, general, hospital-based and special rehabilitation nursing facilities that are enrolled, or applying for enrollment in the Medical Assistance (MA) Program.
Purpose
The purpose of this proposed statement of policy is to provide nursing facilities and other interested persons with notice of the guidelines that the Department intends to use in exercising its existing statutory and regulatory discretion to manage the enrollment and participation of nursing facilities as providers in the MA program.
Background
The Department is the ''Single State Agency'' responsible for the administration of the MA Program. See 62 P. S. § 201(1) regarding State participation in cooperative Federal programs. As the Single State Agency, the Department must operate the MA Program in compliance with Federal law. Federal law requires, among other things, that the Department administer the MA Program in a manner that assures that ''care and services [are] provided in a manner consistent with simplicity of administration and the best interests of recipients,'' and in a manner that safeguards against the unnecessary utilization of services and that assures that MA payments are consistent with efficiency, economy and quality of services. See 42 U.S.C.A. § 1396a(a)(23) and (30)(A) (relating to state plans for medical assistance). Additionally, Federal law requires that the Department administer the MA Program so as to avoid the unjustified institutional isolation of persons with disabilities. Olmstead v. L.C., 527 U.S. 581, 597 (1999).
To ensure compliance with applicable Federal requirements, and acting under its authority under section 201(2) and (3) of the code and regulations in §§ 1101.42(a) and 1101.77(b)(1) (relating to prerequisites for participation and enforcement actions by the Department), the Department issued a series of statements of policy relating to certain provider participation culminating in a 1998 statement of policy (SOP). See 28 Pa.B. 138 (January 10, 1998), codified in §§ 1101.42b, 1101.77a and 1187.21a (relating to certificate of need requirements for participation--statement of policy; terminationfor covenience and best interests of the Department--statement of policy; and nursing facility exception requests--statement of policy). the SOPs, the Department announced both the general policies relating to the participation of nursing facilities, and the specific guidelines that it intended to consider in future adjudications involving nursing facility participation in the MA Program. In adopting and applying these policies and guidelines, the Department's overarching goal was, and remains, to promote the efficient operation of the MA Program in a manner, consistent with the best interests of recipients, that avoids the unjustified institutional isolation of persons with disabilities. The SOPs provide the means for the Department to manage and control the publicly-funded long-term living system in this Commonwealth so as to reduce the MA Program's continued reliance on institutional nursing services and encourage the increased access to and use of home and community-based (HCB) services.
Approximately 10 years after the SOPs were issued, Commonwealth Court determined in Eastwood Nursing & Rehabilitation Center v. Department of Public Welfare, 910 A.2d 134, 148 (2006), that the SOPs were invalid because they imposed binding norms but had not been duly promulgated as regulations. The Court also determined that the SOPs reference to the ''best interests of the Department'' was inconsistent with the Federal requirement that the Department adopt ''safeguards to assure that care and services 'will be provided in a manner consistent with . . . the best interests of the recipient.' ''
Id., at 149. The General Assembly responded to Eastwood by enacting the act of June 30, 2007 (P. L. 33, No. 16) (Act 16). Act 16 amended the Public Welfare Code to require, among other things, private or public nursing facilities to seek and obtain advance written approval from the Department to enroll in the MA Program or to increase their existing certified bed complement if already enrolled in the MA Program. See section 1 of Act 16 (62 P. S. § 443.1(8)). Act 16 also directed the Department to publish proposed regulations by July 1, 2009, setting forth the process and criteria it intends to use to review and act on requests by nursing facilities for approval to enroll in the MA Program or increase their bed capacity. Id. It further specified that, pending the adoption of final regulations or until September 30, 2011, (whichever comes first), the Department must review pending and future requests for enrollment or expansion in accordance with the process and guidelines contained in the statements of policy published at 28 Pa.B. 138 (SOPs). Id. Act 16 also authorized the Department to ''publish amendments to the statement of policy if the department determines that changes to the process and guidelines for reviewing and responding to requests for approval of increases in MA-certified beds will facilitate access to medically necessary nursing facility services or are required to assure that long-term living care and services under the MA program will be provided in a manner consistent with applicable Federal and State law, including Title XIX of the Social Security Act.'' See section 1 of Act 16. Before the Department adopts amendments to the SOP, however, Act 16 requires that the Department solicit public comments for 30 days. This proposed statement of policy announces the Department's intent to amend the existing § 1187.21a published at 28 Pa.B. 138. In proposing these amendments, the Department's intent is to clarify the language of the SOP to address the Federal law concerns identified by the Eastwood court and to streamline the process and guidelines used in conducting reviews thereunder so as to facilitate MA recipients' continued access to medically necessary nursing facility services. The revisions are identified and discussed in greater detail as follows.Discussion
Best Interests of MA Recipients
Since the SOPs were first issued in 1998, the Department's paramount consideration in reviewing nursing facility enrollment and expansion requests has been the best interests of MA-recipients. As noted previously, the Department issued the SOPs to promote the growth in HCB services, which consumers prefer, while ensuring that MA recipients have adequate access to medically necessary nursing facility services. Consistent with the SOPs intended objective, the Department has reviewed nursing facility requests on a case-by-case basis without any presumption as to whether the requests should be approved or denied. In determining whether to approve the enrollment of a new nursing facility provider or an increase in the MA-certified bed capacity of an existing nursing facility provider, the Department has examined occupancy rates, the availability of HCB services, and specific information relating to the needs of MA recipients, including whether MA recipients had adequate access to care in the service area proposed by the provider seeking expansion or enrollment in the MA Program.
To better reflect how the Department has applied and will continue to apply the SOPs in reviewing requests to enroll and expand, the Department is proposing to revise its guidelines to clarify how the occupancy rates and other information that may be relevant to whether MA recipients have adequate access to care and to explicitly state that it will consider whether a project is necessary to address the special needs of individual MA recipients that may exceed the needs of the general MA nursing facility population. See § 1187.21a(h)(1)(iii).
Obsolete Certificate of Need (CON) Provisions
The issuance of the SOPs were prompted by the sunset of the Commonwealth's CON process on December 19, 1996. See 28 Pa.B. 138, 139. The SOPs, however, were not intended to, nor did they, reinstitute the CON process. Nonetheless, the Department recognized that certain providers might not have completed nursing facility projects under CONs issued shortly before December of 1996. Therefore, the Department included separate guidelines for CON holders that reasonably relied on a CON and substantially implemented its project within the time frames required by the CON (see 28 Pa.B. 143 and 55 Pa. Code § 1187.21a(f)). The Department also specified that CON holders should submit requests for enrollment or expansion no later than April 13, 1998, to be considered under these separate guidelines. Since more than 10 years has elapsed, the Department has determined that separate guidelines for CON holders are no longer required, and is proposing to delete the guideline from the SOP.
Outdated Bed Need Projections
When the Department issued the SOP in 1998, it attached ''Appendix C'' as one of the many factors it would consider in evaluating nursing facility enrollment and expansion requests. See 28 Pa.B. at 145, Appendix C. Appendix C was developed by the Department of Health, and contained nursing home bed need projections by counties through the year 2000. Since these projections have not been updated since they were issued, the Department has determined they are obsolete. Additionally, because the projections relate to the community at large, and do not adequately take into account either the increasing availability of HCB services or the current occupancy rates in MA-participating nursing facilities, the Department has concluded that they are no longer relevant in assessing the merits of requests made under the SOP. The Department is proposing to delete Appendix C.
New Bed Transfer Provisions
The nursing facility associations have recommended that the Department include guidelines in the SOP that would apply to requests to increase the number of MA-certified beds of a nursing facility simultaneous with a decrease of an equal or greater number of MA-certified beds in another nursing facility. Upon careful consideration of this recommendation, the Department agrees that there may be circumstances when allowing owners to adjust the MA-certified beds at their nursing facilities may facilitate access to medically necessary nursing facility services for MA recipients but not impede the Department's ability to administer long-term living care and services under the MA program in an efficient and economic manner that is consistent with applicable Federal and State law. Therefore, the Department is proposing to include new provisions in the SOP that will provide for separate guidelines and expedited reviews of bed transfer requests when certain conditions are present.
Because the Department wants the benefit of additional public input on the subject of bed transfers during the regulatory review process, the Department intends to limit application of these new SOP provisions to requests involving nursing facilities owned or controlled by the same legal entity and located in the same county. Requests that do not meet the conditions for consideration under these new provisions will not be automatically denied. Rather, they will be evaluated under the process and guidelines applicable to other bed requests.
Guideline
The proposed amendments to the statement of policy are contained in Annex A.
Effective Date
The statement of policy will be effective upon publication of the final statement of policy in the Pennsylvania Bulletin.
Comments
Interested persons are invited to submit written comments regarding this proposed statement of policy to the Department. Comments and questions regarding the proposed statement of policy should be directed to the Department of Public Welfare, Office of Long-Term Living, Bureau of Policy and Strategic Planning, Gail Weidman, P. O. Box 2675, Harrisburg, PA 17105. Comments received within 30 days will be reviewed and considered in the development of the final statement of policy. Persons with a disability who require an auxiliary aid or service may submit comments using the AT&T Relay Services at (800) 654-5984 (TDD users) or (800) 654-5988 (voice users).
ESTELLE B. RICHMAN,
SecretaryFiscal Note: 14-BUL-077. No fiscal impact; (8) recommends adoption.
Annex A
TITLE 55. PUBLIC WELFARE
PART III. MEDICAL ASSISTANCE MANUAL
CHAPTER 1187. NURSING FACILITY SERVICES
Subchapter C. NURSING FACILITY PARTICIPATION § 1187.21a. Nursing facility [exception requests] participation review process and guidelines--statement of policy.
(a) Scope. This section applies to applicants [and providers] as defined in subsection (i).
(b) Purpose. The purpose of this section is to [provide nursing facilities and other interested persons with notice of] describe the process and the guidelines that the Department [intends to] will use [in exercising its discretion regarding enrollment and participation of nursing facilities as providers in the MA Program] to review and respond to bed requests under section 443.1(8) of the Public Welfare Code (62 P. S. § 443.1(8)).
(c) Policy regarding enrollment and expansion.
(1) [General.
(i) The Department, possessing the authority to regulate nursing facility participation in the MA Program, has discretion to refuse to enter into provider agreements with applicants and to terminate provider agreements with participating providers to protect and advance the best interests of the Department.
(ii) The Department has determined that, in most instances, the current complement of nursing facilities participating in the MA Program results in an adequate supply of nursing facility beds for persons who qualify for MA nursing facility services, and, therefore, in most instances, increasing the number of MA-certified nursing facility beds through the enrollment of new providers or the expansion of existing providers is not in the Department's best interests.
(iii) The Department has determined that, because in most instances an increase in the number of MA-certified beds is not in the Department's best interests, if an applicant or a provider desires to cause an increase, it is appropriate to require the applicant or provider to request the Department's prior approval and to bear the burden of demonstrating that, under the circumstances, an increase in the number of MA-certified beds is in the Department's best interests and that the applicant or provider should be allowed to provide those beds.
(2) Policy regarding enrollment of applicants.
(i) Except as noted in subparagraph (ii), when the Department receives an exception request from an applicant which, if granted by the Department, would cause a currently unenrolled nursing facility to become an enrolled MA provider of nursing facility services, the Department will, in the exercise of its discretion under § 1101.42(a) (relating to prerequisite for participation), deny that exception request.
(ii) The Department will make an exception to the policy in subparagraph (i) if, after considering the applicant's exception request in accordance with subsection (f) or (g), the Department determines that the applicant has demonstrated that its enrollment as an MA provider of nursing facility services is in the best interests of the Department.
(3) Policy regarding expansion of providers.
(i) Except as noted in subparagraph (ii), the Department will, in the exercise of its discretion under § 1101.77(b)(1) (relating to nursing facility exception requests--statement of policy), terminate the enrollment of a provider that undertakes to increase the number of licensed and MA-certified beds at its nursing facility and, further, will terminate the direct or indirect participation of that provider in the MA Program, and may suspend payments to that provider.
(ii) The Department will make an exception to the policy in subparagraph (i) if, after considering the provider's exception request in accordance with subsection (f) or (g), the Department determines that the provider has demonstrated that an increase in the number of the provider's licensed and MA-certified beds is in the Department's best interests.]
Before an applicant increases the number of MA-certified beds in an existing MA nursing facility or the number of MA-certified beds in the MA Program, the applicant shall submit a bed request to the Department and obtain the Department's advance written approval.
(2) The Department will review bed requests on a case-by-case basis in accordance with the guidelines in subsection (g) or (h).
(d) Submission [and content of exception] of bed requests.
(1) An applicant [or provider may make an exception request by submitting] shall submit an original and two copies of its bed request to the Department at the following address:
Department of Public Welfare
[Bureau of Long Term Care Programs]
Office of Long Term Living
P. O. Box 2675
Harrisburg, PA 17105-2675
ATTN: MA/LTC Participation Review [Unit](2) [Except as otherwise provided in subsection (f), an] An applicant [or provider should] shall submit its [exception] bed request to the Department prior to beginning construction of the [new or additional nursing facility beds that will be the subject of its request] applicant's proposed project.
(e) Contents of bed requests.
[(3)] (1) When an applicant submits [an exception] a bed request [ to enroll as an MA provider, or a provider submits an exception request to expand the number of licensed and MA-certified beds at its nursing facility ], the Department has no obligation to independently seek out any information on the question of whether the circumstances of that applicant [or provider] are such that [an exception] the applicant's bed request should be [made] approved. To the contrary, [if an applicant or provider believes an exception should be made,] the applicant [or provider] should submit to the Department whatever information that the applicant [or provider believes to be] believes is relevant to or supports its bed request [to enroll or expand].
[(4) If an applicant or provider submits an exception request to the Department, the Department may base its decision solely upon the information supplied by the applicant or provider. The Department may request or consider additional information other than the information provided by the applicant or provider, including any public comments received on the exception request, and the information specified in subsections (f) and (g).] (2) The Department recommends that a bed request include the information specified in paragraphs (3) and (4). If a bed request does not include the recommended information, the Department will not automatically deny the bed request, but the Department may independently seek and consider the information in determining how to respond to the bed request.
[(5) To enable the Department to fully evaluate an exception request, the Department suggests that an exception request include the following information:] (3) An applicant's bed request should include the following information:
(i) An overview of the applicant's proposed project which [explains how it addresses the Department's goal to develop a fuller array of long-term care supports and services to meet the needs of its MA population and why it meets, or is needed to meet, the nursing facility service needs of the community] includes a description of the population and primary service area the applicant intends to serve.
(ii) A narrative and supporting documentation, if any, addressing each guideline in subsection [(f) or] (g) or (h) and indexed to identify which guideline is being addressed.
(iii) [If the applicant or provider possesses a Certificate of Need (CON) and is seeking an exception under subsection (f), copies of the CON application.
(iv)] Copies of any feasibility or market studies and financial projections prepared for the project, including any studies or projections identifying project costs, sources of project funds, projected revenue sources by payor type, including assumptions used and expected occupancy rates by payor type.
[(v) A list of owners and related parties/entities involved in the project.]
(iv) A list identifying the names and addresses of the owners of the applicant and the owners of the proposed project and any related parties or entities involved in the project and, for each person included on the list, a description of the person's involvement with the project and the information specified in paragraph (4).
[(vi)] (v) Independent audited financial statements, if any, of the applicant [and provider,] and owners or parent corporation, if any, of the applicant [or provider] for the most recent year prior to the fiscal year in which the [exception] bed request is filed.
[(vii)] (vi) Other information that the [provider] applicant believes to be relevant.
[(6) The Department requests that the] (4) An applicant [or provider] should specify [in its narrative and supporting documentation relating to suitability under subsections (f)(10) and (g)(2),] whether or not any of the following applies, and, if so, [that] the applicant [or provider] should attach copies of all documents relating to the applicable action, including notices, orders[,] or sanction letters, received from the [Health Care Financing Administration] Federal Centers for Medicare and Medicaid Services or any state Medicaid, survey or licensing agency:
(i) Whether the applicant[, provider] or any owner of the applicant or proposed project is currently precluded from participating in the Medicare Program or any state Medicaid Program.
(ii) Whether the applicant[, provider] or any owner of the applicant or the proposed project owned, operated or managed a nursing facility, at any time during the [period specified in subsection (f)(10) or (g)(2)] 3-year period preceding the date of the bed request and one of the following applies:
* * * * * [(e)] (f) Consideration of [exception] bed requests.
(1) [Applicants or providers that possess a CON or letter of nonreviewability for their new or additional beds dated on or before December 18, 1996, may submit an exception request (if they have not already done so) under the guidelines in subsection (f), if the exception request is submitted by April 13, 1998. The Department will process and consider requests involving CONs or letters of nonreviewability as they are received. The Department will consider requests not submitted within this 90-day period under the guidelines in subsections (e)(2)--(5) and (g).
(2) The] Subject to paragraph (6), the Department will consider [all other exception requests under subsection (g)] bed requests, other than bed transfer requests, submitted on or after July 1, 2008, biannually in two groups as follows:
(i) Group One will consist of [exception] bed requests other than bed transfer requests received January 1 through June 30. The Department will use its best efforts to issue decisions on Group One [exception requests] by the following December 31.
(ii) Group Two will consist of [exception] bed requests other than bed transfer requests received from July 1 through December 31. The Department will use its best efforts to issue decisions on Group Two [exception requests] by the following June 30.
[(3) Applicants or providers that submitted exception requests received by the Department between December 1996 through June 30, 1997 (Group One-1997) will be permitted until February 11, 1998, to submit additional information relating to their exception requests. The Department will use its best efforts to issue decisions on Group One-1997 by March 31, 1998.
(4) Following the close of each 6-month request period, the Department will publish a notice in the Pennsylvania Bulletin listing the exception requests included in the Group under consideration. For a 30-day period following publication of the notice in the Pennsylvania Bulletin, the Department will make copies of the requests in that Group available for review by the public during regular business hours, and will accept written comments related to the requests in the Group.
(5) The Department may expedite its review and act on an individual request before the target date.]
(2) The Department will use its best efforts to issue decisions on any bed requests, other than bed transfer requests, that were submitted prior to and pending with the Department on June 30, 2008, by _____(Editor's Note: The blank refers to a date 120 days following the date of publication of the final statement of policy in the Pennsylvania Bulletin.).
(3) The Department will use its best efforts to issue decisions on any bed transfer requests that were submitted prior to _____ Editor's Note: The blank refers to the effective date of publication of the final statement of policy in the Pennsylvania Bulletin by _____ (Editor's Note: The blank refers to a date 60 days after the effective date of publication of the final statement of policy in the Pennsylvania Bulletin.).
(4) The Department will consider bed transfer requests submitted on or after _____(Editor's Note: The blank refers to the effective date of publication of the final statement of policy in the Pennsylvania Bulletin.) in the order in which they are received. Subject to paragraph (6), the Department will issue decisions on those requests on an ongoing basis following the expiration of the public comment period set forth in paragraph (5)(ii).
(5) Public process.
(i) Bed requests, other than bed transfer requests. Following the close of each 6-month request period, the Department will make available on the Office of Long Term Living (OLTL) web site a listing of the bed requests, other than bed transfer requests, included in the group under consideration. For a 30-day period following the date that the notice is posted on the web site, the Department will make copies of the requests in that group available for review by the public during regular business hours, and will accept written comments related to the requests in the group.
(A) The Group One listing will be made available on the OLTL web site on or before January 31.
(B) The Group Two listing will be made available on the OLTL web site on or before July 31.
(ii) Bed transfer requests. No later than 15 calendar days following the last day of each calendar month, the Department will make available on the OLTL web site a listing of the bed transfer requests received by the Department during that calendar month. For a 15-day period following the date that the notice is posted on the web site, the Department will make copies of the bed transfer requests that are listed in the notice for that calendar month available for review by the public during regular business hours, and will accept written comments related to the bed transfer requests.
(6) If an applicant demonstrates good cause, the Department may expedite its review and respond to a bed request before the target date; provided that the Department will not respond prior to the close of the applicable public comment period specified in paragraph (5)(i) and (ii).
(7) In reviewing an applicant's bed request, the Department will consider the information provided by the applicant and any public comments received on the request. In addition, the Department may consider information contained in the Department's books and records or obtained from persons other than the applicant that is relevant to the applicant's bed request including:
(i) The information specified in subsection (e)(3) and (4).
(ii) Data relating to the overall occupancy rates of MA nursing facilities in the applicant's primary service area and the county in which the applicant's proposed project is located.
(iii) Data relating to the admission rates for day-one MA eligible persons and the MA occupancy rates of MA nursing facilities in the applicant's primary service area and the county in which the applicant's proposed project is located.
(iv) Data relating to the availability of home and community based services in the applicant's primary service area and the county in which the applicant's proposed project is located.
(v) Data relating to the demographics of the applicant's primary service area and the county in which the applicant's proposed project is located.
(vi) Data relating to the admission and discharge practices of the applicant and of MA nursing facilities in the applicant's primary service area and the county in which the applicant's proposed project is located.
(vii) Data relating to the applicant's suitability as a provider of nursing facility services.
(viii) Data relating to the availability of specialized medical services the applicant is proposing to provide in the applicant's primary service area and the county in which the applicant's proposed project is located.
[(f) Consideration of exception requests made by applicants and providers possessing CON or letters of nonreviewability dated on or before December 18, 1996. In considering whether an applicant or provider has demonstrated that an increase in the number of MA-certified beds is in the Department's best interests, the Department will use the following guidelines and will consider the following information in evaluating the request:
(1) Whether the applicant or provider possesses a CON or letter of nonreviewability dated on or before December 18, 1996, authorizing the construction of new or additional nursing facility beds.
(2) Whether the Department of Health has issued a license to the applicant or provider authorizing it to operate the new or additional beds.
(3) If the applicant's or provider's CON or letter of nonreviewability was issued within 24 months of the date of its written notice to the Department, whether the applicant or provider demonstrates to the satisfaction of the Department that it is implementing its approved project in accordance with the substantial implementation timetable included in its approved CON application or, if not, whether there is good cause for the delay.
(4) If the applicant's or provider's CON or letter of nonreviewability was issued more than 24 months before the date of its written notice to the Department, whether the applicant or provider demonstrates to the satisfaction of the Department that it has substantially implemented its project as defined in 28 Pa. Code § 401.2 (relating to definitions), as effective December 18, 1996, or, if not, whether there is good cause for the failure.
(5) Whether the applicant or provider demonstrates to the satisfaction of the Department that, in determining that its project was economically and financially feasible, it presumed that it would participate in the MA Program and render services to MA recipients.
(6) For an applicant that possesses a CON for the new beds, whether the applicant will agree to provide written assurances to the Department that it will serve at least that percentage of MA recipients specified in its CON application, and that it will admit day-one MA recipients on a first-come/first-served basis as necessary to achieve and maintain that MA percentage on an ongoing basis.
(7) For a provider that is seeking to expand its number of licensed and certified beds under a CON, whether the provider will agree to provide written assurances to the Department that it will serve at least that percentage of MA recipients specified in its CON application, and that it will admit day-one MA recipients on a first-come/first served basis as necessary to achieve and maintain that MA occupancy percentage.
(8) For a provider that is seeking to expand its number of licensed and certified beds under a letter of nonreviewability, whether the provider will agree to provide written assurances to the Department that it will serve at least that percentage of MA recipients necessary to achieve an MA occupancy rate equal to its MA occupancy rate percentage in effect during the most recent 12-month fiscal period ending prior to its written request to the Department, and that it will admit day-one MA recipients on a first-come/first served basis as necessary to achieve and maintain that MA occupancy percentage.
(9) Whether the applicant or provider will agree to provide written assurances to the Department that the construction of its new or additional beds will be economically and financially feasible without the receipt of MA capital component payments and that it is not entitled to MA capital component payments related to the new or additional beds.
(10) Whether the applicant or provider has demonstrated suitability for enrollment or expansion. In determining whether an applicant or provider is suitable, the Department will consider the record of licensure and Medicaid and Medicare Program participation of the applicant, provider and any owner of the applicant or provider subsequent to the issuance date of the CON or letter of nonreviewability.]
(g) Guidelines for evaluation of [all other exception requests] bed transfer requests. [Except for those exception requests reviewed under subsection (f), the Department will use the following guidelines and will consider the following information in evaluating an exception request.] The Department will use the following guidelines to evaluate bed transfer requests:
(1) Whether the nursing facility that will increase its MA-certified beds (receiving facility) and the nursing facility that will decrease its MA-certified beds (surrendering facility) admit MA day-one recipients.
(2) Whether the decrease in beds at the surrendering facility will result in access barriers to nursing facility services for MA recipients. For purposes of this determination, the Department will examine, among other things, the MA occupancy rates both at the surrendering facility and at the receiving facility.
(3) Whether the increase in beds at the receiving facility will improve access to nursing facility services for MA recipients. For purposes of this determination, the Department will examine, among other things, the MA occupancy rates both at the surrendering facility and at the receiving facility.
(4) Whether the proposed project will result in a change in peer group under Chapter 1187 (relating to nursing facility services) for the surrendering or receiving facility and, if so, whether the change will have a negative or positive effect on the MA Program or on MA recipients.
(5) Whether the surrendering facility received capital component payments for the closed beds.
(6) Whether during the 3 year period preceding the date of the bed transfer request, the applicant, the receiving facility, the surrendering facility or any other nursing facility where the applicant is the owner, has been precluded from participation in the MA Program or in the Medicare Program; has been subject to the imposition of licensing or MA or Medicare certification sanctions or remedies; or has operated under a Corporate Integrity Agreement with the Department or the Federal government.
(h) Guidelines for evaluation of bed requests other than bed transfer requests. The Department will use the following guidelines in evaluating any bed request that is not a bed transfer request:
(1) MA Program's need for additional nursing facility beds. The Department will determine whether [the MA Program needs] additional MA-certified nursing facility beds are needed in the applicant's [or provider's] primary service area and the county in which the applicant's proposed project is located to facilitate MA recipients' access to medically necessary nursing facility services or to assure that MA long-term living care and services will be provided in a manner consistent with applicable Federal and State law, including Title XIX of the Social Security Act (42 U.S.C.A. §§ 1396--1396v) and, if so, whether the applicant [or provider] has demonstrated to the Department's satisfaction that it will meet that [MA Program] need. [The] In making these determinations, the Department will review and consider [information as may be provided by the applicant or provider to show that a need for additional MA-certified nursing facility beds exists in the applicant's or provider's primary service area. The Department regards] the following [information as relevant to the determination of MA Program need]:
(i) [The extent to which MA recipients have access to nursing facility services in the applicant's or provider's primary service area] The existing size and utilization of the MA-certified bed capacity in the applicant's primary service area and the county in which the applicant's proposed project is located.
(ii) The extent to which MA recipients, including day-one MA recipients [and technology-dependent MA recipients] have access to [nursing facility beds] the existing MA-certified bed capacity in the applicant's [or provider's] primary service area and the county in which the applicant's proposed project is located, and whether there are systemic barriers that prevent MA recipients from accessing that bed capacity.
(iii) [Whether, and to what extent (expressed as a percentage of MA occupancy), the applicant or provider is willing and able to admit and serve day-one eligible MA recipients.
(iv) Whether the applicant or provider is willing and able to admit and serve technology-dependent MA recipients.
(v) Whether there are any alternatives to an increase in the number of MA-certified nursing facility beds, such as an increase in home and community-based services, that would be less costly, more efficient or more appropriate in meeting any MA Program need.
(vi) Except for those exception requests involving nursing facility beds licensed prior to March 31, 1997, whether there is a need for additional nursing facility beds in the applicant's or provider's primary service area. In determining whether such a bed need exists, the Department will consider whether, and to what extent, the applicant's or provider's primary service area involves a county with bed shortages or surpluses, as set forth in Appendix C. Occupancy rates in the applicant's and provider's primary service area are also relevant to this determination.]
Whether the applicant is willing and able to admit and serve MA recipients having specialized medical needs and the extent to which MA recipients needing specialized medical services proposed by the applicant have access to the existing MA-certified bed capacity in the applicant's primary service area and the county in which the applicant's proposed project is located, and whether there are systemic barriers that prevent MA recipients with specialized medical needs from accessing that bed capacity.
(iv) Whether, and to what extent (expressed as a percentage of MA occupancy), the applicant is willing and able to admit and serve day-one eligible MA recipients.
(v) Whether there are any alternatives to an increase in the number of MA-certified nursing facility beds, such as an increase in home and community-based services, that would be less costly, more efficient or more appropriate in assuring that long-term living care and services will be provided under the MA Program in a manner consistent with applicable Federal and State law.
(vi) Whether, and how, the applicant's proposed project would affect the Department's goal to rebalance the Commonwealth's publicly-funded long-term living system in order to create a fuller array of service options for MA recipients.
(2) Suitability. The Department will determine whether the [applicant or provider has demonstrated suitability for enrollment or expansion. In determining whether an applicant or provider is suitable, the Department will consider the] record of licensure and Medicaid and Medicare Program participation of the applicant[, provider] and any owner of the applicant or [provider beginning 3 years prior to the date of the exception request] the applicant's proposed project during the 3-year period preceding the date of the applicant's bed request demonstrates the applicant's suitability to increase the number of MA-certified nursing facility beds in the MA Program.
(3) Economic and financial feasibility without MA capital component payments. [If an applicant's new beds or the provider's additional beds will be ineligible for capital cost reimbursement under § 1187.113(a) (relating to capital component payment limitation), the] The Department will consider whether the applicant [or provider] will agree to provide written assurances to the Department that the construction of its new or additional beds will be economically and financially feasible without the receipt of MA capital component payments and that it is not entitled to MA capital component payments related to the new or additional beds.
(4) Employment of welfare and [Medical Assistance] MA recipients. The Department will consider whether an applicant [or provider] will commit to employ welfare or [medical assistance] MA recipients in its new or expanded facility.
[(h)] (i) Time lines for completion of approved projects. [Applicants or providers who are granted exceptions] An applicant whose bed request is approved shall provide written assurances to the Department that the [construction of the new or additional beds] applicant's project will be completed in sufficient time so that the beds may be licensed, certified and available for occupancy within 3 years from the date the Department approves the applicant's [or provider's enrollment or expansion, or ] bed request, or by another date as may be specified by the applicant [or provider] and agreed to by the Department.
[(i)] (j) Definitions. For purposes of this section, the following words and terms, have the following meanings, unless the context clearly indicates otherwise:
Applicant--A person who submits a bed request to the Department [which, if granted, would cause a nursing facility not presently enrolled in the MA Program to become a participating provider of nursing facility services to MA Program recipients].
Bed request--A request by an applicant for the Department's approval to increase the number of MA-certified beds in a county or nonpublic nursing facility or to increase the number of MA-certified beds in the MA Program either by increasing the number of beds in an existing MA nursing facility or by enrolling a new MA nursing facility.
Bed transfer request--A bed request in which all of the following conditions apply:
(i) The applicant seeks the Department's approval to increase the number of MA-certified beds in a county or nonpublic nursing facility.
(ii) The applicant represents that, if the Department approves the applicant's request, the same number of MA-certified nursing facility beds at a different nursing facility will be simultaneously decertified and permanently closed.
(iii) The same person is an owner of the nursing facilities.
(iv) The nursing facilities are located in the same county.
* * * * * [Exception request--A request by an applicant to enroll in the MA Program as a nursing facility provider or, in the case of an MA nursing facility provider, to expand its licensed and MA-certified bed capacity.]
* * * * * Specialized medical services--Services not routinely provided in a nursing facility. These services may include, services needed by an individual who requires a respirator for survival, has severe dementia or traumatic brain injury.
[ Technology-dependent--In need of a respirator for survival. ]
(Editor's Note: The Department is proposing to delete Appendix C which appears in 55 Pa. Code pages 1187-83--1187-86 (serial pages (332529) to (332532).)
Appendix C. [Reserved]. ______
1 The statutory provision on which the Eastwood Court relied in making this determination states that A State plan for medical assistance must--
(19) provide such safeguards as may be necessary to assure that eligibility for care and services under the plan will be determined, and such care and services will be provided, in a manner consistent with simplicity of administration and the best interests of the recipients.
42 U.S.C. § 1396a(a)(19)
[Pa.B. Doc. No. 08-1971. Filed for public inspection October 31, 2008, 9:00 a.m.]
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