BILL REQ. #: H-1868.1
State of Washington | 62nd Legislature | 2011 Regular Session |
READ FIRST TIME 02/17/11.
AN ACT Relating to the direct care and financing allowance component rate allocations for medicaid nursing facilities; amending RCW 74.46.437, 74.46.485, and 74.46.501; and declaring an emergency.
BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF WASHINGTON:
Sec. 1 RCW 74.46.437 and 2001 1st sp.s. c 8 s 8 are each amended
to read as follows:
(1) ((Beginning July 1, 1999,)) The department shall establish for
each medicaid nursing facility a financing allowance component rate
allocation. The financing allowance component rate shall be rebased
annually, effective July 1st, in accordance with the provisions of this
section and this chapter.
(2) ((Effective July 1, 2001,)) The financing allowance ((shall
be)) is determined by multiplying the net invested funds of each
facility by .10, and dividing by the greater of a nursing facility's
total resident days from the most recent cost report period or resident
days calculated on eighty-five percent facility occupancy((. Effective
July 1, 2002, the financing allowance component rate allocation for all
facilities, other than essential community providers, shall be set by
using the greater of a facility's total resident days from the most
recent cost report period or resident days calculated at ninety percent
facility occupancy)) for essential community providers, ninety percent
facility occupancy for small nonessential community providers, or
ninety-two percent facility occupancy for large nonessential community
providers. However, assets acquired on or after May 17, 1999, shall be
grouped in a separate financing allowance calculation that shall be
multiplied by .085. The financing allowance factor of .085 shall not
be applied to the net invested funds pertaining to new construction or
major renovations receiving certificate of need approval or an
exemption from certificate of need requirements under chapter 70.38
RCW, or to working drawings that have been submitted to the department
of health for construction review approval, prior to May 17, 1999. If
a capitalized addition, renovation, replacement, or retirement of an
asset will result in a different licensed bed capacity during the
ensuing period, the prior period total resident days used in computing
the financing allowance shall be adjusted to the greater of the
anticipated resident day level or eighty-five percent of the new
licensed bed capacity((. Effective July 1, 2002, for all facilities,
other than essential community providers, the total resident days used
to compute the financing allowance after a capitalized addition,
renovation, replacement, or retirement of an asset shall be set by
using the greater of a facility's total resident days from the most
recent cost report period or resident days calculated at ninety percent
facility occupancy)) for essential community providers, ninety percent
of the new licensed bed capacity for small nonessential community
providers, or ninety-two percent of the new licensed bed capacity for
large nonessential community providers.
(3) In computing the portion of net invested funds representing the
net book value of tangible fixed assets, the same assets, depreciation
bases, lives, and methods referred to in ((RCW 74.46.330, 74.46.350,
74.46.360, 74.46.370, and 74.46.380)) department rule, including owned
and leased assets, shall be utilized, except that the capitalized cost
of land upon which the facility is located and such other contiguous
land which is reasonable and necessary for use in the regular course of
providing resident care shall also be included. Subject to provisions
and limitations contained in this chapter, for land purchased by owners
or lessors before July 18, 1984, capitalized cost of land ((shall be))
is the buyer's capitalized cost. For all partial or whole rate periods
after July 17, 1984, if the land is purchased after July 17, 1984,
capitalized cost ((shall be)) is that of the owner of record on July
17, 1984, or buyer's capitalized cost, whichever is lower. In the case
of leased facilities where the net invested funds are unknown or the
contractor is unable to provide necessary information to determine net
invested funds, the secretary ((shall have)) has the authority to
determine an amount for net invested funds based on an appraisal
conducted according to ((RCW 74.46.360(1).)) department rule.
(4) Effective July 1, 2001, for the purpose of calculating a
nursing facility's financing allowance component rate, if a contractor
has elected to bank licensed beds prior to May 25, 2001, or elects to
convert banked beds to active service at any time, under chapter 70.38
RCW, the department shall use the facility's new licensed bed capacity
to recalculate minimum occupancy for rate setting and revise the
financing allowance component rate, as needed, effective as of the date
the beds are banked or converted to active service. However, in no
case shall the department use less than eighty-five percent occupancy
of the facility's licensed bed capacity after banking or conversion.
Effective July 1, 2002, in no case, other than for essential community
providers, shall the department use less than ninety percent occupancy
of the facility's licensed bed capacity after conversion.
(5)
(4) The financing allowance rate allocation calculated in
accordance with this section shall be adjusted to the extent necessary
to comply with RCW 74.46.421.
Sec. 2 RCW 74.46.485 and 2010 1st sp.s. c 34 s 9 are each amended
to read as follows:
(1) The department shall:
(a) Employ the resource utilization group III case mix
classification methodology. The department shall use the forty-four
group index maximizing model for the resource utilization group III
grouper version 5.10, but the department may revise or update the
classification methodology to reflect advances or refinements in
resident assessment or classification, subject to federal requirements;
and
(b) Implement minimum data set 3.0 under the authority of this
section and RCW 74.46.431(3). The department must notify nursing home
contractors twenty-eight days in advance the date of implementation of
the minimum data set 3.0. In the notification, the department must
identify for all semiannual rate settings following the date of minimum
data set 3.0 implementation a previously established semiannual case
mix adjustment established for the semiannual rate settings that will
be used for semiannual case mix calculations in direct care until
minimum data set 3.0 is fully implemented. ((After the department has
fully implemented minimum data set 3.0, it must adjust any semiannual
rate setting in which it used the previously established case mix
adjustment using the new minimum data set 3.0 data.))
(2) A default case mix group shall be established for cases in
which the resident dies or is discharged for any purpose prior to
completion of the resident's initial assessment. The default case mix
group and case mix weight for these cases shall be designated by the
department.
(3) A default case mix group may also be established for cases in
which there is an untimely assessment for the resident. The default
case mix group and case mix weight for these cases shall be designated
by the department.
Sec. 3 RCW 74.46.501 and 2010 1st sp.s. c 34 s 11 are each
amended to read as follows:
(1) From individual case mix weights for the applicable quarter,
the department shall determine two average case mix indexes for each
medicaid nursing facility, one for all residents in the facility, known
as the facility average case mix index, and one for medicaid residents,
known as the medicaid average case mix index.
(2)(a) In calculating a facility's two average case mix indexes for
each quarter, the department shall include all residents or medicaid
residents, as applicable, who were physically in the facility during
the quarter in question based on the resident assessment instrument
completed by the facility and the requirements and limitations for the
instrument's completion and transmission (January 1st through March
31st, April 1st through June 30th, July 1st through September 30th, or
October 1st through December 31st).
(b) The facility average case mix index shall exclude all default
cases as defined in this chapter. However, the medicaid average case
mix index shall include all default cases.
(3) Both the facility average and the medicaid average case mix
indexes shall be determined by multiplying the case mix weight of each
resident, or each medicaid resident, as applicable, by the number of
days, as defined in this section and as applicable, the resident was at
each particular case mix classification or group, and then averaging.
(4) In determining the number of days a resident is classified into
a particular case mix group, the department shall determine a start
date for calculating case mix grouping periods as specified by rule.
(5) The cutoff date for the department to use resident assessment
data, for the purposes of calculating both the facility average and the
medicaid average case mix indexes, and for establishing and updating a
facility's direct care component rate, shall be one month and one day
after the end of the quarter for which the resident assessment data
applies.
(6)(a) Although the facility average and the medicaid average case
mix indexes shall both be calculated quarterly, the cost-rebasing
period facility average case mix index will be used throughout the
applicable cost-rebasing period in combination with cost report data as
specified by RCW 74.46.431 and 74.46.506, to establish a facility's
allowable cost per case mix unit. To allow for the transition to MDS
3.0 and implementation of RUG IV, for the period of July 1, 2011,
through June 30, 2013, the department shall calculate rates using the
medicaid average case mix index scores effective January 1, 2011, and
the scores shall be increased each six months during the transition
period by one-half of one percent. The July 1, 2013, direct care rate
cost per case mix unit shall be calculated by utilizing 2011 direct
care costs and 2011 facility average case mix index. A facility's
medicaid average case mix index shall be used to update a nursing
facility's direct care component rate semiannually.
(b) The facility average case mix index used to establish each
nursing facility's direct care component rate shall be based on an
average of calendar quarters of the facility's average case mix indexes
from the four calendar quarters occurring during the cost report period
used to rebase the direct care component rate allocations as specified
in RCW 74.46.431.
(c) The medicaid average case mix index used to update or
recalibrate a nursing facility's direct care component rate
semiannually shall be from the calendar six-month period commencing
nine months prior to the effective date of the semiannual rate. For
example, July 1, 2010, through December 31, 2010, direct care component
rates shall utilize case mix averages from the October 1, 2009, through
March 31, 2010, calendar quarters, and so forth.
NEW SECTION. Sec. 4 This act is necessary for the immediate
preservation of the public peace, health, or safety, or support of the
state government and its existing public institutions, and takes effect
immediately.