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Providers Given Additional Time for EO #38 Filings

The State’s Executive Order (EO) #38 webpage indicates that the deadline for all providers to file disclosure statements on executive compensation and administrative costs has been extended to Sept. 29, 2020. At the top of the webpage, it states:

“NOTICE: Due to the COVID-19 pandemic, the Governor’s Office has found justifiable cause to grant all required disclosure statement filers an additional three months within which to submit their disclosure otherwise due by June 29th of this year. Disclosures must now be completed online on or before Tuesday, September 29, 2020.”

Ordinarily, nursing homes and certified home health agencies (CHHAs) would have been required to submit their EO #38 disclosures and any requested waivers from the “Hard Cap” on executive compensation or the Administrative Expense Cap by the date their Medicaid cost reports are due. The 2019 nursing home and CHHA cost reports are due Sept. 15, 2020 and Oct. 31, 2020, respectively. For assisted living programs (ALPs), adult care facilities (ACFs), and licensed home care services agencies (LHCSAs), the deadline for submission of disclosures/waivers is typically 180 days after the end of the calendar year (or provider’s fiscal year), most often by the end of June.

In determining whether a provider needs to request a waiver of the executive compensation limitation, members should be aware that in October 2018, the New York State Court of Appeals issued an opinion in LeadingAge New York et al v. Shah which upheld the Hard Cap and Administrative Expense Cap while striking down the “Soft Cap.” While the Hard Cap applies exclusively to the use of State funds and State-authorized payments to pay executive compensation, the Soft Cap had prohibited executive compensation in excess of $199,000 from all sources of revenue unless the compensation was within the 75th percentile of comparable providers and had been approved by the provider’s governing board, including at least two independent directors or voting members. The Department of Health (DOH) proposed regulatory changes in September 2019 that would have conformed its regulations to the court’s ruling, but these have not yet been adopted. Nonetheless, the court’s ruling is legally binding, as explained in a Hinman Straub summary.

Contact: Dan Heim, dheim@leadingageny.org