101 CMR, § 206.06

Current through Register 1533, October 25, 2024

Section 206.06 - Adjustments to Standard Nursing Facility Rates

(1)Certification of Public Expenditures of a Nursing Facility Owned and Operated by a Municipality.

(a) Within 60 days after the filing of its Medicare CMS-2540 cost report, a nursing facility, which is owned and operated by a municipality, may submit a request for Certified Public Expenditures (CPE) to EOHHS. This CPE will account for its public expenditures of providing Medicaid services to eligible Medicaid members. The submission will be based on the inpatient routine service cost reported on the CMS-2540 Medicare cost report.

(b) Following review of the nursing facility's submission, EOHHS will, within 60 days of the submission, approve, deny, or revise the amount of the CPE request based upon its evaluation of the reported costs and payments. The final approved amount will be equal to the difference between the Medicaid interim payments and the total allowable Medicaid costs as determined by EOHHS. This final determined amount will be certified by the municipality as eligible for federal match.

(c) Interim payments are based on the standard payment methodology pursuant to 101 CMR 206.00.

(d) EOHHS will determine total allowable Medicaid costs based on the Medicare CMS-2540 Cost Report and will determine a per diem rate calculated as follows.

1.Medicaid Allowable Skilled Nursing Facility Costs. Total allowable costs (Worksheet B, Part I, Line 30, Col 18), divided by total days (Worksheet S-3, Line 1, Col 7), times Medicaid days (worksheet S-3, Line 1, Col 5).

2.Medicaid Allowable Nursing Facility Costs. Total allowable costs (Worksheet B, Part I, Line 31, Col 18), divided by total days (Worksheet S-3, Line 3, Col 7), times Medicaid days (Worksheet S-3, Line 3, Col 5).

3.Total Allowable Medicaid Costs. The sum of the amount determined in 101 CMR 206.06(1)(d)1. and 2.

(e) EOHHS will calculate an interim reconciliation based on the difference between the interim payments and total allowable Medicaid costs from the as-filed CMS-2540 Cost Report. The nursing facility must notify EOHHS immediately if the CMS-2540 is reopened or an audit is completed. Within 60 days after receiving notification of the final Medicare settlement EOHHS will retroactively adjust the final settlement amount.

(2)Quality Adjustments. Beginning October 1, 2024, a nursing facility may be eligible for a quality adjustment in the form of an increase or decrease applied to the facility's nursing standard rate and operating standard rate at each PDPM nursing case mix category. The quality adjustment will be equal to the sum of the percent increase or decrease assessed for performance on each of the following four quality measures: Quality Achievement Based on CMS Score, Quality Improvement Based on CMS Score, Quality Achievement Based on DPH Score, and Quality Improvement based on DPH Score.

(a)Quality Achievement Based on CMS Score. The quality adjustment a nursing facility will incur under the measure "Quality Achievement Based on CMS Score" will be based on the facility's overall rating on the Centers for Medicare and Medicaid Services Nursing Home Compare 5-Star Quality Rating Tool as of June 2023, as described in the table below. Facilities that CMS has designated as not rated due to a history of serious quality issues (i.e., Special Focus Facilities) will be considered to have a score of 1 for the purposes of this quality adjustment.

CMS Overall Score as of June 2023	Adjustment Percentage
1	-1.00%
2	-0.75%
3	0.00%
4	0.75%
5	1.00%

(b)Quality Improvement Based on CMS Score. The quality adjustment a nursing facility will incur under the measure "Quality Improvement Based on CMS Score" will be based on the facility's overall rating on the Centers for Medicare and Medicaid Services Nursing Home Compare 5-Star Quality Rating Tool, as follows. If a facility has a score of 5 Stars as of June 2023, its adjustment for this measure will be 2.0%, regardless of whether it meets any other criteria in the following table. If a facility meets the criteria for "CMS Chronic Low Quality," its adjustment for this measure will be -3.0%, regardless of whether it meets any other criteria in the following table. Facilities that CMS has designated as not rated due to a history of serious quality issues (i.e., Special Focus Facilities) will be considered to meet the criteria for "CMS Chronic Low Quality" for the purposes of this quality adjustment.

Criteria Based on CMS Rating	Adjustment Percentage
Facility has a score of five Stars as of June 2023	2%
Facility experienced an increase of two or more Stars from June 2022, to June 2023	1.5%
Facility experienced an increase of one Star from June 2022, to June 2023	1%
Facility experienced no change to its Star rating from June 2022, to June 2023	0%
Facility experienced a decrease of one Star from June 2022, to June 2023, and had a score of five Stars as of June 2022	0%
Facility experienced a decrease of one Star from June 2022, to June 2023, and did not have a score of five Stars as of June 2022	-2%
Facility experienced a decrease of two or more Stars from June 2022, to June 2023	-2.5%
CMS Chronic Low Quality: The average of a facility's scores as of June 2020, June 2021, June 2022, and June 2023 is less than or equal to 1.5 Stars	-3%

(c)Quality Achievement Based on DPH Score. The quality adjustment a nursing facility will incur under the measure "Quality Achievement Based on DPH Score" will be based on the facility's performance on the Department of Public Health's Nursing Facility Survey Performance Tool (DPH NFSPT) as of July 1, 2023, as follows:

DPH NFSPT Score as of July 1, 2023	Adjustment Percentage
110 or less	-1.00%
111 - 115	-0.75%
116 - 119	0.00%
120 - 123	0.75%
124+	1.00%

(d)Quality Improvement Based on DPH Score. The quality adjustment a nursing facility will incur under the measure "Quality Improvement Based on DPH Score" will be based on the facility's performance on the DPH NFSPT, as follows. If a facility has a DPH NFSPT score of 124 or higher as of July 1, 2023, its adjustment for this measure will be 2.0%, regardless of whether it meets any other criteria in the following table. If a facility meets the criteria for "DPH Chronic Low Quality," its adjustment for this measure will be -3.0%, regardless of whether it meets any other criteria in the following table.

Criteria based on DPH FSPT Score	Adjustment Percentage
Facility has a score of 124 or higher as of July 1, 2023	2.0%
Facility experienced an increase of four or more points from July 1, 2022, to July 1, 2023	1.5%
Facility experienced an increase of one, two, or three points from July 1, 2022, to July 1, 2023	1.0%
Facility experienced no change to its score from July 1, 2022, to July 1, 2023	0.0%
Facility experienced a decrease of one, two, or three points from July 1, 2022, to July 1, 2023, and had a score of 124 or higher as of July 1, 2022	0.0%
Facility experienced a decrease of one, two, or three points from July 1, 2022, to July 1, 2023, and did not have a score of 124 or higher as of July 1, 2022	-2.0%
Facility experienced a decrease of four or more points from July 1, 2022, to July 1, 2023	-2.5%
DPH Chronic Low Quality: Facility had a score of less than 100 as of each of the following dates: July 1, 2021; July 1, 2022; and July 1, 2023	-3%

(3)Kosher Food Services. Nursing facilities with kosher kitchen and food service operations may receive an add-on of up to $5 per day to reflect the additional costs of these operations.

(a)Eligibility. To be eligible for this add-on, the nursing facility must

1. maintain a fully kosher kitchen and food service operation that is, at least annually, rabbinically approved or certified; and in accordance with all applicable requirements of law related to kosher food and food products including, but not limited to, M.G.L. c. 94, § 156;

2. provide to the Center a written certification from a certifying authority, including the complete name, address, and phone number of the certifying authority, that the applicant's nursing facility maintains a fully kosher kitchen and food service operation in accordance with Jewish religious standards. For purpose of 101 CMR 206.06(3)(a)2., the phrase "certifying authority" will mean a recognized kosher certifying organization or rabbi who has received Orthodox rabbinical ordination and is educated in matters of Orthodox Jewish law;

3. provide a written certification from the administrator of the nursing facility that the percentage of the nursing facility's residents requesting kosher foods or products prepared in accordance with Jewish religious dietary requirements is at least 50%; and

4. upon request, provide the Center with documentation of expenses related to the provision of kosher food services, including but not limited to, invoices and payroll records.

(b)Payment Amounts.

1. To determine the add-on amount, EOHHS will determine the statewide median dietary expense per day for all facilities. The add-on equals the difference between the eligible nursing facility's dietary expense per day and the statewide median dietary expense per day, not to exceed $5 per day. In calculating the per day amount, EOHHS will include allowable expenses for dietary and dietician salaries, payroll taxes and related benefits, food, dietary purchased service expense, dietician purchased service expense, and dietary supplies and expenses. The days used in the denominator of the calculation will be the higher of the nursing facility's actual days or 96% of available bed days.

2. EOHHS will compare the sum of the add-on amounts multiplied by each nursing facility's projected annual rate period Medicaid days to the state appropriation. In the event that the sum exceeds the state appropriation, each nursing facility's add-on will be proportionally adjusted.

(5)Leaves of Absence. If a purchasing agency pays for leaves of absence, the payment rate for a leave of absence day is $80.10 per day, unless otherwise determined by the purchasing agency.

(6)Nursing Cost. Eligible facilities will receive an $91.79 per diem add-on to reflect the difference between the standard payment amounts and actual base year nursing spending. To be eligible for such payment, the Department of Public Health must certify to EOHHS that over 75% of the nursing facility's residents have a primary diagnosis of multiple sclerosis.

(7)Pediatric Nursing Facilities.

(a) Beginning October 1, 2024, EOHHS will determine payments to facilities licensed to provide pediatric nursing facility services using allowable reported operating costs, excluding administrative and general costs, from the nursing facility's 2019 Cost Report. EOHHS will include an administrative and general payment capped at the 85^th percentile of the 2019 statewide administrative and general costs. EOHHS will apply an appropriate cost adjustment factor to operating, and administrative and general costs.

(b) The operating component of the rate is increased by a cost adjustment factor of 23.50%.

(c) Facilities licensed to provide pediatric nursing facility services will receive the operating rate which is the greater of

1. the rates calculated as described in 101 CMR 206.06(7)(a) and 101 CMR 206.06(7)(b); or

2. the Operating Cost Standard rate as listed in 101 CMR 206.04(2).

(9)Receiverships. EOHHS may adjust a nursing facility's standard rates if a receiver has been appointed under M.G.L. c. 111, § 72N solely to reflect the reasonable costs, as determined by EOHHS and the MassHealth agency, associated with the court-approved closure or sale of the nursing facility or other appropriate situation.

(10)Residential Care Beds. Beginning October 1,2024, the total payment for nursing and other operating costs for residential care beds in a dually licensed nursing facility is $140.41.

(11)State-operated Nursing Facilities. A nursing facility operated by the Commonwealth will be paid at the nursing facility's reasonable cost of providing covered Medicaid services to eligible Medicaid members.

(a) EOHHS will establish an interim per diem rate using a base year CMS-2540 cost report inflated to the rate year using the cost adjustment factor calculated pursuant to 101 CMR 206.06(11)(b) and a final rate using the final rate year CMS-2540 cost report.

(b) EOHHS will determine a cost adjustment factor using a composite index using price level data from the CMS Nursing Home without capital forecast, and regional health care consumer price indices, and the Massachusetts-specific consumer price index (CPI), optimistic forecast. EOHHS will use the Massachusetts CPI as proxy for wages and salaries.

(c) EOHHS may retroactively adjust the final settled amount when the Medicare CMS-2540 cost report is reopened or for audit adjustments.

(12)Low Occupancy Adjustment. Effective October 1, 2022, a nursing facility may be subject to a Low Occupancy Adjustment to its payment rate, according to the following methodology:

(a) Each facility's occupancy is calculated as follows:

1. Determine the facility's total resident days as reported on quarterly User Fee Assessment Forms covering the period of July 1, 2021, through June 30, 2022;

2. Determine the facility's total number of licensed beds as of June 30, 2022, minus licensed Level IV beds. Multiply the result by the number of days in the year.

3. Calculate the facility's occupancy by dividing the result of 101 CMR 206.06(12)(a)1. by the result of 101 CMR 206.06(12)(a)2. and rounding the result to the nearest hundredth of a percent.

(b) Based on the occupancy calculated in 101 CMR 206.06(12)(a), a facility may face a reduction to its nursing standard rate and operating rate, applied at each management minute category as follows:

1. Except as described in 101 CMR 206.06(12)(b)2., the reduction is applied in accordance with the following chart:

Occupancy Rate	Low Occupancy Penalty
Occupancy below 80.00%	-3.0%
Occupancy of at least 80.00%, but below 84.00%	-2.0%
Occupancy of at least 84.00%, but below 88.00%	-1.0%
Occupancy of at least 88.00%	0.0%

2. For the rate year running from October 1, 2022, through September 30, 2023, the downward adjustment for nursing facilities with occupancy rates at 80.00% or higher shall be waived and the downward adjustment for nursing facilities with occupancy rates below 80.00% shall be -2%.

(c) A nursing facility will be eligible for a one-time reconsideration of its Low Occupancy Adjustment as determined in 101 CMR 206.06(12)(b) to be applied beginning February 1, 2023, if the nursing facility

1. reduces by any amount its number of licensed beds from the number of licensed beds in the facility as of June 30, 2022, by January 1, 2023; and

2. submits a completed Low Occupancy Adjustment Request form, along with supporting documentation indicated on the form to EOHHS by January 1, 2023.

(d) Upon receiving a completed Low Occupancy Adjustment Request form and supporting documentation from a nursing facility as described in 206.06(12)(c)2, EOHHS will recalculate the facility's occupancy, as follows:

1. determine the facility's total resident days as reported on quarterly User Fee Assessment Forms covering the period July 1, 2021, through June 30, 2022;

2. determine the facility's total number of licensed beds as of January 1, 2023, minus licensed Level IV beds. Multiply the result by the number of days in the year; and

3. calculate the facility's occupancy rate by dividing the result of 101 CMR 206.06(12)(d)1. by the result of 101 CMR 206.06(12)(d)2. and rounding the result to the nearest hundredth of a percent.

(e) The facility's new occupancy rate, as calculated in 206.06(12)(d)3., will be used to redetermine the amount or applicability of the Low Occupancy Adjustment, as described 206.06(12)(b). Any changes to a facility's Low Occupancy Adjustment as a result of a new occupancy rate will apply solely prospectively, beginning February 1, 2023.

(f) EOHHS will not adjust any Low Occupancy Adjustment solely because a facility under-reported total resident days on its quarterly User Fee Assessment Form.

(13)Direct Care Add-on.

(a)General. Beginning October 1, 2024, a nursing facility will be eligible for an upward adjustment of 3.177% applied to its nursing standard rate and operating standard rate at each PDPM nursing case mix category. Facilities must use the funds from this direct care add-on solely for direct care staff wages, benefits, incentive payments, or other direct care compensation.

(b)Reporting.

1. Each facility will be required to report to EOHHS on the ways in which it uses its received direct care add-on funds. The required reporting will be incorporated in the interim or final DCC-Q reports that facilities are required to submit by March 1, 2025, and July 31, 2025, respectively, in accordance with 101 CMR 206.12(3). Failure to complete the required supplemental payment reporting on the interim or final DCC-Q reports, as specified and required by MassHealth through administrative bulletin or other written issuance, failure to timely submit the interim or final DCC-Q reports, or failure to use direct care add-on funds on anything other than direct care staff wages, benefits, incentive payments, or other direct care compensation may result in partial or full recoupment of direct care add-on funds as an overpayment under 130 CMR 450.237: Overpayments: Determination.

2. All information included in the reports regarding the direct care add-on funds is subject to verification and audit by MassHealth. Failure to submit the required reporting or comply with audits or document requests with respect to the requirements herein may result in partial or full recoupment of the direct care add-on funds as overpayments under 130 CMR 450.237: Overpayments: Determination, or sanctions under 130 CMR 450.238: Sanctions: General.

(14)High Medicaid Adjustment. Beginning October 1, 2024, a nursing facility may be eligible for a High Medicaid Adjustment to its payment rate, based on the proportion of the facility's total resident days which are Massachusetts Medicaid days, as reported on the facility's quarterly User Fee Assessment Forms covering the period April 1, 2023, through March 31, 2024. For the purpose of determining eligibility for the High Medicaid Adjustment, the proportion of the facility's total resident days which are Massachusetts Medicaid days will be rounded to the nearest hundredth of a percent.

(a) A facility for which its Massachusetts Medicaid days are at least 75.00% and less than 90.00% of its total resident days will receive a 7% upward adjustment applied to its nursing standard rate and operating standard rate at each PDPM nursing case mix category.

(b) A facility for which Massachusetts Medicaid days are at least 90.00% of its total resident days will receive a 9% upward adjustment applied to its nursing standard rate and operating standard rate at each PDPM nursing case mix category.

(c) EOHHS will not adjust any High Medicaid Adjustment solely because a facility under-reported Massachusetts Medicaid days in its quarterly User Fee Assessment Form.

(15)Maximum Change Adjustment. Beginning October 1, 2024, a nursing facility will be subject to an adjustment to its total standard nursing facility per diem rate at each PDPM nursing case mix category established through 101 CMR 206.04, 101 CMR 206.05, 101 CMR 206.06(2) through (14), and 101 CMR 206.12(4), if a facility's proposed total average per diem rate, beginning October 1, 2024, calculated using the facility's average PDPM nursing case mix in the period October 1, 2023, through March 31, 2024, is greater than 130% of the facility's total average per diem standard nursing facility rate that was in effect on September 30, 2023, calculated using the facility's average MMQ case mix in rate year 2022. The adjustment will be calculated as follows:

(a) determine the facility's proposed total average per diem rate, calculated using the facility's average PDPM nursing case mix in the period October 1, 2023, through March 31, 2024, pursuant to 101 CMR 206.04, 101 CMR 206.05, 101 CMR 206.06(2) through (14), and 101 CMR 206.12(4);

(b) determine 130% of the facility's average per diem rate that was in effect on September 30, 2023, calculated using the facility's average MMQ case mix in rate year 2022;

(c) subtract the amount calculated in 101 CMR 206.06(15)(a) from the amount calculated in 101 CMR 206.06(15)(b);

(d) divide the amount calculated in 101 CMR 206.06(15)(c) by the amount calculated in 101 CMR 206.06(15)(a);

(e) the percentage calculated in 101 CMR 206.06(15)(d) will be applied as a downward adjustment to the total proposed standard nursing facility per diem rate, as established through 101 CMR 206.04, 101 CMR 206.05, 101 CMR 206.06(2) through (14), and 101 CMR 206.12(4), at each PDPM nursing case mix category.