HB 5235: Nursing Facility Reimbursement Summary

• Mandates the Commissioner of Social Services implement an acuity-based reimbursement methodology for Medicaid nursing home services, effective beginning July 1, 2020, with quarterly updates.

• Establishes cost-neutral transition to acuity-based reimbursement based on fiscal year ending June 30, 2018 cost reports with no inflationary increases for fiscal year ending June 30, 2021.

• Divides allowable costs into five components (direct care, indirect care, fair rent, capital-related, and administrative/general) with specific maximum percentages for each component based on peer groupings and state-wide medians.

• Requires geographic peer groupings of facilities and sets minimum occupancy at 90% of certified bed capacity for rate computation purposes, with exceptions for new facilities.

• Allows the Commissioner discretion to provide pro rata fair rent increases for facilities with documented fair rent additions placed in service during specified cost report years, within available appropriations.