2022 Session

Budget Amendments - SB30 (Member Request)

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Chief Patron: Barker
Nursing Facility Rate Improvements

Item 304 #13s

Item 304 #13s

First Year - FY2023 Second Year - FY2024
Health and Human Resources
Department of Medical Assistance Services FY2023 $50,198,180 FY2024 $54,537,553 GF
FY2023 $56,834,187 FY2024 $54,537,553 NGF

Page 313, line 47, strike "$18,732,988,737" and insert "$18,840,021,104".
Page 313, line 47, strike "$19,820,607,534" and insert "$19,929,682,640".

Page 340, after line 10 insert:

"PPPP. 1. Effective July 1, 2022, the department shall modify nursing facility direct and indirect peer group pricing. Specifically, the department shall determine the prices by using the relevant facility with the 75th percentile day in place of the currently-mandated facility with the 50th percentile, or “day-weighted median” day. The department shall utilize the data from the most recent rebasing to make this change effective for FY 2023 and subsequent rate years until the next scheduled rebasing. Any subsequent rebasing shall apply this methodology change, but shall use the specified base year data according to the normal or otherwise mandated schedule.

2. Effective July 1, 2022, the department shall modify the fair rental value capital rate component for nursing facilities to: (i) eliminate the minimum occupancy assumption; (ii) create a private room capital component under the same methodology as the remainder of beds except that the imputed gross square feet per bed levels shall be multiplied by a factor of 1.5; and, (iii) reset the “facility average age” to 21 years for any building with a calculated “facility average age” in excess of 21 years. This reset “facility average age” shall serve as the maximum age for all facilities for seven years from implementation of this change. After seven years, facility average age shall not be subject to this maximum, and shall begin to increase annually from the calculated actual facility average age on that date or age 21, whichever is less.

3. Effective July 1, 2022, the department shall eliminate the application of a “Medicaid allowable” limit in determining the Medicaid liability for dually eligible individuals' patient payment responsibility for services received under Medicare Part A. The department shall apply this to fee-for-service and also require Medicaid managed care plans to adopt this payment policy.

4. The department shall have the authority to implement these reimbursement changes prior to the completion of any regulatory process to effect such changes. To the extent federal approval requires alternative approaches to achieve the same general results, the department shall have the authority to follow the federal guidance."


(This amendment adds $50.2 million from the general fund the first year and $54.5 million from the general fund the second year and $56.8 million from the nongeneral fund the first year and $54.5 the second year from federal matching Medicaid funds to increase Medicaid payment rates for nursing homes. Language would direct the Medicaid program to modify the reimbursement methodology for nursing homes to: (i) cover incurred costs for a larger percentage of Medicaid days and remove Medicaid's non-payment of dually eligible individuals' patient responsibility under Medicare, (ii) remove outdated occupancy assumptions, (iii) recognize the need for some amount of private beds for infection prevention and control through reimbursement recognition, and (iv) encourage reinvestment in facility infrastructure.)