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PA Bulletin, Doc. No. 16-1090


Nursing Facility Assessment Program for Fiscal Year 2016-2017

[46 Pa.B. 3352]
[Saturday, June 25, 2016]

 This notice announces the proposed assessment amount, the proposed assessment methodology and the estimated aggregate impact on nursing facilities that will be subject to the assessment under the Nursing Facility Assessment Program beginning Fiscal Year (FY) 2016-2017.


 Article VIII-A of the Human Services Code (code) (62 P.S. §§ 801-A—815-A) authorizes the Department of Human Services (Department) to impose an annual monetary assessment on nonpublic and county nursing facilities in this Commonwealth each fiscal year.1 Under Article VIII-A of the code, 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 of the code requires the Department to seek a waiver from the Centers for Medicare & Medicaid Services (CMS) if necessary to implement the Assessment Program. See 62 P.S. § 812-A. For FY 2016-2017, the Department intends to submit a waiver request to CMS to authorize continuation of the Assessment Program. The implementation of the Assessment Program as described in this notice is contingent on the reauthorization of Article VIIII-A of the code and CMS' approval of the waiver request.

 For each fiscal year that the Assessment Program is implemented, the Secretary of the Department (Secretary) determines 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 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 FFP. See 62 P.S. § 804-A.

 Before imposing an annual assessment for a fiscal year, the Secretary must publish a notice in the Pennsylvania Bulletin. 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.

 This notice announces the assessment amounts, rates and methodology that the Department is proposing to implement in FY 2016-2017 and the estimated aggregate impact on nursing facilities that will be subject to the assessment in FY 2016-2017.

Proposed Assessment Methodology and Rates

 The Department is proposing to use the same assessment methodology in FY 2016-2107 that was used in FY 2015-2016 with several modifications as follows:

 During FY 2016-2107, the assessment will be imposed on all licensed nursing facilities in this Commonwealth except the following nursing facilities, which will continue to be exempt from the Assessment Program:

 (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.

 As in FY 2015-2016, the Department is proposing to continue to assess nonexempt nursing facilities at two rates. For FY 2016-2017, the Department is proposing the one rate will remain at $8.01, and will be imposed on the same four categories of nursing facilities:

 • County nursing facilities.

 • Nursing facilities that have 44 or fewer licensed beds.

 • Certain Continuing Care Retirement Community (CCRC) nursing facilities (see 40 Pa.B. 7297 (December 18, 2010)).

 • Nursing facilities with an MA occupancy rate of at least 94% based on the four consecutive assessment quarters beginning April 1, 2015, and ending March 31, 2016, for each nursing facility as of April 22, 2016. A nursing facility's MA occupancy rate for the purpose of qualifying for the lower assessment rate will be calculated as follows: MA Occupancy Rate = Sum of Total PA MA Days from each of the four quarters ÷ Sum of Total Resident Days from each of the four quarters, rounded to two decimals.

 For all other nonexempt facilities, including nursing facilities that began participation in a CCRC on or after July 1, 2010, the Department is proposing the facilities be assessed at the rate of $32.10, an increase of $2.04 from the FY 2015-2016 rate.

 In FY 2015-2016 and previous fiscal years, the Department assessed each nonexempt facility on a quarterly basis and calculated 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 proceeded the assessment quarter. For FY 2016-2017, the Department is proposing to calculate an annual assessment amount for each nonexempt facility by multiplying its assessment rate by the facility's historical non-Medicare resident day for the four consecutive assessment quarters beginning April 1, 2015, and ending March 31, 2016. The Department will collect the annual assessment amount in four equal quarterly installments.

Aggregate Assessment Amounts and Fiscal Impact

 The Department estimates that if the proposed assessment rates are implemented the annual aggregate assessment fees for nonexempt nursing facilities will total $506.472 million. The Department will use the State revenue derived from the assessment fees and any associated FFP to support payments to qualified MA nursing facility providers in accordance with applicable laws and regulations.

Public Comment

 Interested persons are invited to submit written comments regarding this notice to the Department of Human Services, Office of Long-Term Living, Bureau of Policy and Regulatory Management, Attention: Marilyn Yocum, P.O. Box 8025, Harrisburg, PA 17105-8025. Comments must be submitted within 30 days of publication of the notice. See 62 P.S. § 805-A. After considering the comments, the Secretary will publish a second notice announcing the final assessment rates for FY 2015-2016. The Department will not begin collecting assessment fees until after the publication of the final assessment rate 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).


Fiscal Note: 14-NOT-1033. (1) General Fund; (2) Implementing Year 2015-16 is $0; (3) 1st Succeeding Year 2016-17 is -$506,472,000; 2nd Succeeding Year 2017-18 through 5th Succeeding Year 2020-21 are $0; (4) 2014-15 Program—$810,454,000; 2013-14 Program—$820,409,000; 2012-13 Program—$770,903,000; (7) Long-Term Care; (8) recommends adoption. Funds have been included in the budget to cover this increase.

[Pa.B. Doc. No. 16-1090. Filed for public inspection June 24, 2016, 9:00 a.m.]


1  The assessment under Article VIII-A of the code expires June 30, 2016 (see 62 P.S. § 815-A). This notice assumes that the General Assembly will enact legislation to reauthorize the assessment, effective July 1, 2016.

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