Nursing Home Reimbursement Update
During the November nursing home finance meeting between the Department of Health (DOH) and associations representing nursing homes, DOH staff indicated that a technical glitch had delayed the 2022 initial capital review process and confirmed that lump sum payments are in executive review. Highlights of topics covered are summarized below.
Lump Sum Payments. LeadingAge NY has advocated for the release of these annual payments as soon as possible given the difficult financial position of many nursing homes. DOH has confirmed that these payments are in executive review and that the Bureau of Residential Health Care Reimbursement is doing its best to expedite them. Members will recall that in recent years, providers received $140 million in funding associated with the reinvestment of provider 0.8 percent assessment payments as well as the redistribution of $50 million in Medicaid reimbursement based on Nursing Home Quality Initiative (NHQI) scores. In addition, this year marks the first year that an additional supplemental payment of $70 million per year is being added to the distribution. These funds were previously used to fund the Universal Settlement. Because there are two years of this funding outstanding, we believe that the total lump sum distribution will be $280 million in addition to the NHQI redistribution.
Assessment Reconciliation. While not discussed during the meeting, DOH notified homes last week that the Department has reconciled 2020 cash receipts assessment payments and reimbursements. The Department has also updated the assessment reimbursement amount used in Fee-for-Service (FFS) Medicaid to the 2020 reconciled per-day amount retroactive to Jan. 1, 2021. Both the reconciliation and the retro adjustment will be reflected in Medicaid payment cycle 2308 (check date of Nov. 15th, released on Dec. 1st). The back-up data for the calculation is available here, and the accompanying Dear Administrator Letter (DAL) is here. We recommend that members review their figures and file any correction requests with DOH within 30 days of Nov. 3rd using the form attached to the DAL.
2 Percent Quality Penalty. While the updated 2 percent quality penalty is reflected in the benchmark rates, the Department is in the process of updating that provision in FFS Medicaid rates as well. The penalty is assessed on homes whose NHQI score is in the lowest quintile in the most current NHQI year AND their prior year’s score falls into the lowest or second lowest quintile. The payment adjustments retroactive to January 2021 have not yet been assigned a Medicaid payment cycle.
2022 Capital. During a typical year, DOH would have circulated a draft 2022 capital calculation to providers for review in early fall and would have published notice rates in early November. However, due to a glitch in the system, Department staff are still working on draft calculations, which are expected in early December. At the meeting, LeadingAge NY again pushed for the State to calculate capital rates without imputing 90 percent occupancy during the public health emergency. The letter we sent with other associations on the issue is available here. While DOH indicated that the proposal would be part of the budget process, we continue to seek earlier action.
70/40 and Staffing Level Regulations. DOH indicated that it intends to move forward and publish regulations associated with the 70/40 legislation as well as staffing levels legislation in the State Register as early as next week. The regulations are unchanged from the informational version that the Department shared with the Public Health and Health Planning Council (PHHPC) in October. A summary of the regulatory provisions, which track closely to the legislative language of each provision, is available here. The comments LeadingAge NY submitted are here, and our comments at the PHHPC meeting are here. DOH also indicated that it is working on a State Plan Amendment to distribute $64 million allocated in the State Budget to assist homes that meet the 70/40 spending provisions in defraying staffing costs. While participants made several recommendations, the Department was not able to share any specifics about their internal discussions at this time.
If you have questions regarding the above, please do not hesitate to reach out.
Contact: Ken Allison, kallison@leadingageny.org, 518-867-8820 or Darius Kirstein, dkirstein@leadingageny.org, 518-461-5993