2000 Session

Budget Amendments - SB30 (Member Request)

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Chief Patron: Reynolds
Co-Patron(s): Ticer
Nursing Home Rates & Methodology

Item 319 #10s

Item 319 #10s

First Year - FY2001 Second Year - FY2002
Health And Human Resources
Medical Assistance Services, Department of FY2001 $13,500,000 FY2002 $13,500,000 GF
FY2001 $14,600,000 FY2002 $14,600,000 NGF

Page 244, line 45, strike "$2,849,830,824" and insert "$2,877,930,824".
Page 244, line 45, strike "$2,896,793,218" and insert "$2,924,893,218".
Page 250, after line 8 insert:
"X.1.  Beginning July 1, 2000, the Department of Medical Assistance Services will increase reimbursement rates in the current nursing facility payment system in order to:
a.  Restore funding for the negative impact resulting from application of the Patient Intensity Rating System (PIRS) case mix adjustment.  The existing PIRS and associated resident assessment instruments shall continue to be used to determine patient acuity until a Resource Utilization Group (RUG) methodology is implemented.
b.  Reduce the occupancy standard to 85% for indirect rates and plant costs and remove entirely from determination of direct care costs, rates, and ceilings.
c.  Adjust the direct care cost ceiling to 125% of the median.  The Department shall annually determine the median nursing facility direct care cost on a geographic peer group basis, and establish a direct care cost ceiling at 125% of the inflation-adjusted median and shall reimburse nursing facilities for direct care costs using the lesser of inflation-adjusted facility-reported cost data from the prior fiscal year or the applicable peer group ceiling.
d.  Establish an indirect care rate annually at 110% of the inflation-adjusted peer group median.  The Department will annually determine the inflation-adjusted median nursing facility indirect cost on a geographic peer group basis to establish the indirect rate.
2.  The Department shall provide nursing facility provider groups with the financial and patient acuity data it uses to make the determinations cited above.  The Department shall work with nursing facility provider groups to implement a Resource Utilization Group (RUG) based payment methodology no later than January 1, 2001."

(This amendment adds funds for increased Medicaid reimbursement for nursing homes and prescribes changes in the methodology.)