5827 AMH DAY WELS1

SB 5827 - H AMD TO BRADDOCK AMD (5827 AMH BRAD H2968.1) 624 ADOPTED

     4-19-91

By Representatives Day and Moyer

     On page 7, line 21 of the amendment,  after "July 17, 1984," insert "and before July 1, 1993,"

SB 5827 - H AMD TO BRADDOCK AMD (5827 AMH BRAD H2968.1)

By Representative Day

     Beginning on page 13, line 3 of the amendment, after "July 17, 1984," insert "and before July 1, 1993,"

SB 5827 - H AMD TO BRADDOCK AMD (5827 AMH BRAD H2968.1)

By Representative Day

     On page 15, line 28 of the amendment, after "December 31, 1984," insert "and before July 1, 1993,"

SB 5827 - H AMD TO BRADDOCK AMD (5827 AMH BRAD H2968.1)

By Representative Day

     Beginning on page 18, after line 2 of the amendment, insert the following

     "(c) The provisions of (a) and (b) of this subsection shall not apply to an arm's-length transaction that occurs on or after July 1, 1993.  The valuation of capital assets, for the purposes of determining payment rates for nursing facilities, will not be increased (as measured from the date of acquisition by the seller to the date of the change of ownership) solely as a result of a change of ownership, by more than the lesser of:

(i) one-half of the percentage increases (as measured over the same period of time or, if necessary, as extrapolated retrospectively by the secretary) in the dodge construction index systems costs for nursing homes, applied to the aggregate with respect to those facilities which have undergone a change of ownership during the fiscal year; or

(ii) one-half of the percentage increase (as measured over the same period of time) in the consumer price index for all urban consumers (United States city average)."

Renumber the remaining subsections consecutively.

EFFECT AND RATIONALE:  These amendments move the reimbursement system to the federally permissible basis for recognizing increased valuation of capital assets at the beginning of the biennium after next.  Currently, our system recognizes no increased valuation of capital assets upon sale of a nursing facility.  Over time, this places great pressure on the direct care portion of the reimbursement rate to finance the required costs of maintaining the capital assets.  Federal law allows for limited recognition of increased value of capital assets upon sale.