As Introduced

128th General Assembly Regular Session 2009-2010

H. B. No. 579

Representatives Slesnick, Boyd 

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A BILL

To amend sections 3721.50 and 3721.53 of the Revised

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Code, to amend Section 309.30.25 of Am. Sub. H.B.

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1 of the 128th General Assembly, as subsequently

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amended, and to repeal Section 309.30.70 of Am.

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Sub. H.B. 1 of the 128th General Assembly to

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revise the law governing the nursing home and

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hospital long-term care unit franchise permit fee

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and to revise the law governing fiscal year 2011

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Medicaid payments to nursing facilities and

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intermediate care facilities for the mentally

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retarded.

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BE IT ENACTED BY THE GENERAL ASSEMBLY OF THE STATE OF OHIO:

Section 1.  That sections 3721.50 and 3721.53 of the Revised	12
Code be amended to read as follows:	13

Sec. 3721.50.  As used in sections 3721.50 to 3721.58 of the	14
Revised Code:	15

(A) "Franchise permit fee rate" means the amount determined	16
as follows:	17

(1) Determine the difference between the following:

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(a) The total net patient revenue, less medicaid per diem	19
payments, of all nursing homes and hospital long-term care units	20
as shown on cost reports filed under section 5111.26 of the	21
Revised Code for the calendar year immediately preceding the	22
fiscal year for which the franchise permit fee is assessed under	23
section 3721.51 of the Revised Code;	24

(b) The total net patient revenue, less medicaid per diem	25
payments, of all nursing homes and hospital long-term care units	26
as shown on cost reports filed under section 5111.26 of the	27
Revised Code for the calendar year immediately preceding the	28
calendar year that immediately precedes the fiscal year for which	29
the franchise permit fee is assessed under section 3721.51 of the	30
Revised Code.	31

(2) Multiply the amount determined under division (A)(1) of	32
this section by five and five-tenths per cent;	33

(3) Divide the amount determined under division (A)(2) of	34
this section by the total number of days in the fiscal year for	35
which the franchise permit fee is assessed under section 3721.51	36
of the Revised Code;	37

(4) Subtract eleven dollars and ninety-five cents from the	38
amount determined under division (A)(3) of this section;	39

(5) Add eleven dollars and ninety-five cents to the amount	40
determined under division (A)(4) of this sectionsix dollars and	41
twenty-five cents.	42

(B) "Hospital" has the same meaning as in section 3727.01 of	43
the Revised Code.	44

(C) "Hospital long-term care unit" means any distinct part of	45
a hospital in which any of the following beds are located:	46

(1) Beds registered pursuant to section 3701.07 of the	47
Revised Code as skilled nursing facility beds or long-term care	48
beds;	49

(2) Beds licensed as nursing home beds under section 3721.02	50
or 3721.09 of the Revised Code.	51

(D) "Inpatient days" means all days during which a resident	52
of a nursing facility, regardless of payment source, occupies a	53
bed in the nursing facility that is included in the facility's	54
certified capacity under Title XIX. Therapeutic or hospital leave	55
days for which payment is made under section 5111.26 of the	56
Revised Code are considered inpatient days proportionate to the	57
percentage of the facility's per resident per day rate paid for	58
those days.	59

(E) "Medicaid" has the same meaning as in section 5111.01 of	60
the Revised Code.	61

(F) "Medicaid day" means all days during which a resident who	62
is a medicaid recipient occupies a bed in a nursing facility that	63
is included in the facility's certified capacity under Title XIX.	64
Therapeutic or hospital leave days for which payment is made under	65
section 5111.26 of the Revised Code are considered medicaid days	66
proportionate to the percentage of the nursing facility's per	67
resident per day rate for those days.	68

(G) "Medicare" means the program established by Title XVIII.

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(H) "Nursing facility" has the same meaning as in section	70
5111.20 of the Revised Code.	71

(I)(1) "Nursing home" means all of the following:

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(a) A nursing home licensed under section 3721.02 or 3721.09	73
of the Revised Code, including any part of a home for the aging	74
licensed as a nursing home;	75

(b) A facility or part of a facility, other than a hospital,	76
that is certified as a skilled nursing facility under Title XVIII;	77

(c) A nursing facility, other than a portion of a hospital	78
certified as a nursing facility.	79

(2) "Nursing home" does not include any of the following:

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(a) A county home, county nursing home, or district home	81
operated pursuant to Chapter 5155. of the Revised Code;	82

(b) A nursing home maintained and operated by the department	83
of veterans services under section 5907.01 of the Revised Code;	84

(c) A nursing home or part of a nursing home licensed under	85
section 3721.02 or 3721.09 of the Revised Code that is certified	86
as an intermediate care facility for the mentally retarded under	87
Title XIX.	88

(J) "Title XIX" means Title XIX of the "Social Security Act,"	89
79 Stat. 286 (1965), 42 U.S.C. 1396, as amended.	90

(K) "Title XVIII" means Title XVIII of the "Social Security	91
Act," 79 Stat. 286 (1965), 42 U.S.C. 1395, as amended.	92

Sec. 3721.53.  (A) Not later than the fifteenth day of	93
SeptemberAugust of each year, the department of job and family	94
services shall determine the annual franchise permit fee for each	95
nursing home and hospital in accordance with section 3721.51 of	96
the Revised Code and any adjustments made in accordance with	97
sections 3721.512 and 3721.513 of the Revised Code.	98

(B) Not later than the first day of OctoberSeptember of each	99
year, the department shall mail to each nursing home and hospital	100
notice of the amount of the franchise permit fee that has been	101
determined for the nursing home or hospital.	102

(C) Each nursing home and hospital shall pay its fee under	103
section 3721.51 of the Revised Code, as adjusted in accordance	104
with sections 3721.512 and 3721.513 of the Revised Code, to the	105
department in four installment payments not later than forty-five	106
days after the last day of each OctoberSeptember, December,	107
March, and June.	108

(D) No nursing home or hospital shall directly bill its	109
residents for the fee paid under this section, or otherwise	110
directly pass the fee through to its residents.	111

Section 2.  That existing sections 3721.50 and 3721.53 of the	112
Revised Code are hereby repealed.	113

Section 3. That Section 309.30.25 of Am. Sub. H.B. 1 of the	114
128th General Assembly, as amended by Sub. H.B. 198 of the 128th	115
General Assembly, be amended to read as follows:	116

Sec. 309.30.25. FISCAL YEAR 2011 MEDICAID REIMBURSEMENT	117
SYSTEM FOR NURSING FACILITIES	118

(A) As used in this section:

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"Fiscal year 2010 partial rate" means the total rate a	120
provider of a nursing facility is paid for nursing facility	121
services the nursing facility provides on June 30, 2010, less the	122
portion of that total rate that equals the sum of the workforce	123
development incentive payment and consolidated services rate	124
included in the total rate pursuant to divisions (D) and (E) of	125
Section 309.30.20 of Am. Sub. H.B. 1 of the 128th General	126
Assembly.	127

"Franchise permit fee," "inpatient days," "Medicaid days,"	128
"nursing facility," and "provider" have the same meanings as in	129
section 5111.20 of the Revised Code.	130

"Nursing facility services" means nursing facility services	131
covered by the Medicaid program that a nursing facility provides	132
to a resident of the nursing facility who is a Medicaid recipient	133
eligible for Medicaid-covered nursing facility services.	134

(B) Except as otherwise provided by this section, the	135
provider of a nursing facility that has a valid Medicaid provider	136
agreement on June 30, 2010, and a valid Medicaid provider	137
agreement during fiscal year 2011 shall be paid, for nursing	138
facility services the nursing facility provides during fiscal year	139
2011, the rate calculated for the nursing facility under sections	140
5111.20 to 5111.33 of the Revised Code with the following	141
adjustments:	142

(1) The cost per case mix-unitcase-mix unit calculated under	143
section 5111.231 of the Revised Code, the rate for ancillary and	144
support costs calculated under section 5111.24 of the Revised	145
Code, the rate for tax costs calculated under section 5111.242 of	146
the Revised Code, and the rate for capital costs calculated under	147
section 5111.25 of the Revised Code shall each be adjusted as	148
follows:	149

(a) Increase the cost and rates so calculated by two per	150
cent;	151

(b) Increase the cost and rates determined under division	152
(B)(1)(a) of this section by two per cent;	153

(c) Increase the cost and rates determined under division	154
(B)(1)(b) of this section by one per cent.	155

(2) The mean payment used in the calculation of the quality	156
incentive payment made under section 5111.244 of the Revised Code	157
shall be, weighted by Medicaid days, three dollars and three cents	158
per Medicaid day.	159

(3) The rate, after the adjustments under divisions (B)(1)	160
and (2) of this section are made, shall be further adjusted by a	161
percentage that the Department of Job and Family Services shall	162
determine in consultation with the Ohio Health Care Association;	163
Ohio Academy of Nursing Homes; and the Association of Ohio	164
Philanthropic Homes, Housing, and Services for the Aging. The	165
percentage shall be based on expending an amount equal to the	166
amount determined as follows:	167

(a) Determine how much of the revenue to be generated under	168
section 3721.51 of the Revised Code for fiscal year 2011 reflects	169
the calculations made under divisions (A)(1) to (4) of section	170
3721.50 of the Revised Code;	171

(b) From the amount determined under division (B)(3)(a) of	172
this section, subtract the portion of the amount to be expended	173
under division (F) of this section that reflects the part of the	174
calculation made under division (F)(2) of this section.	175

(C) Except as provided in division (G)(F) of this section, if	176
the rate determined for a nursing facility under division (B) of	177
this section for nursing facility services provided during fiscal	178
year 2011 is more than one hundred two and twenty-five hundredths	179
per cent of the nursing facility's fiscal year 2010 partial rate,	180
the Department of Job and Family Services shall reduce the nursing	181
facility's rate determined under division (B) of this section for	182
fiscal year 2011 so that the rate is not more than one hundred two	183
and twenty-five hundredths per cent of the nursing facility's	184
fiscal year 2010 partial rate. Except as provided in division	185
(G)(F) of this section, if the rate determined for a nursing	186
facility under division (B) of this section for nursing facility	187
services provided during fiscal year 2011 is less than ninety-nine	188
per cent of the nursing facility's fiscal year 2010 partial rate,	189
the Department shall increase the nursing facility's rate	190
determined under division (B) of this section for fiscal year 2011	191
so that the rate is not less than ninety-nine per cent of the	192
nursing facility's fiscal year 2010 partial rate.	193

(D) After the adjustments under divisions (B) and (C) of this	194
section are made to a nursing facility's fiscal year 2011 rate,	195
the Department of Job and Family Services shall increase the	196
nursing facility's fiscal year 2011 rate by the amount of real	197
estate taxes reported on the nursing facility's cost report for	198
calendar year 2004 divided by the number of inpatient days	199
reported on that cost report if the nursing facility had a credit	200
regarding its real estate taxes reflected on its cost report for	201
calendar year 2003.	202

(E) After the adjustments under divisions (B), (C), and (D)	203
of this section are made to a nursing facility's fiscal year 2011	204
rate, the Department of Job and Family Services shall increase the	205
nursing facility's fiscal year 2011 rate by fivethree dollars and	206
seventyninety-one cents per Medicaid day. This increase shall be	207
known as the workforce development incentive paymentconsolidated	208
services rate. The total amount of workforce development incentive	209
payments paid to providers of nursing facilities shall be used to	210
improve nursing facilities' employee retention and direct care	211
staffing levels, including by increasing wages paid to nursing	212
facilities' direct care staff. Not later than September 30, 2012,	213
the Department shall submit a report to the Governor and, in	214
accordance with section 101.68 of the Revised Code, the General	215
Assembly detailing the impact that the workforce development	216
incentive payments have on nursing facilities' employee retention,	217
direct care staffing levels, and direct care staff wages.	218

(F) After the adjustment under division (E) of this section	219
is made to a nursing facility's fiscal year 2011 rate, the	220
Department of Job and Family Services shall increase the nursing	221
facility's fiscal year 2011 rate by the consolidated services rate	222
per Medicaid day. The consolidated services rate shall equal the	223
sum of the following:	224

(1) Three dollars and ninety-one cents;

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(2) The amount calculated under divisions (A)(1) to (4) of	226
section 3721.50 of the Revised Code for fiscal year 2011.	227

(G)(F) If the fiscal year 2010 rate for a nursing facility as	228
initially determined under division (B) of Section 309.30.20 of	229
Am. Sub. H.B. 1 of the 128th General Assembly is not subject to an	230
adjustment under division (C) of that section, the nursing	231
facility's fiscal year 2011 rate as initially determined under	232
division (B) of this section shall not be subject to an adjustment	233
under division (C) of this section regardless of whether the	234
nursing facility's fiscal year 2011 rate as initially determined	235
under division (B) of this section would, if not for this	236
division, be subject to the adjustment.	237

If the fiscal year 2011 rate for a nursing facility as	238
initially determined under division (B) of this section is not	239
subject to an adjustment under division (C) of this section, the	240
nursing facility's rate shall not be subject to an adjustment	241
under that division for the remainder of fiscal year 2011	242
regardless of any other adjustment made to the nursing facility's	243
fiscal year 2011 rate under sections 5111.20 to 5111.33 of the	244
Revised Code.	245

(H) Not later than October 1, 2010, the Department of Job and	246
Family Services shall determine the rates to be paid providers of	247
nursing facilities under this section. Until the rates are	248
determined, the Department shall continue to pay a provider the	249
rate the provider is paid for nursing facility services the	250
provider's nursing facility provides on June 30, 2010. When the	251
Department determines the rates to be paid under this section, the	252
Department shall pay the rates retroactive to July 1, 2010.	253

(I)(G) If the United States Centers for Medicare and Medicaid	254
Services requires that the franchise permit fee be reduced or	255
eliminated, the Department of Job and Family Services shall reduce	256
the amount it pays providers of nursing facility services under	257
this section as necessary to reflect the loss to the state of the	258
revenue and federal financial participation generated from the	259
franchise permit fee.	260

(J)(H) The Department of Job and Family Services shall follow	261
this section in determining the rate to be paid to the provider of	262
a nursing facility that has a valid Medicaid provider agreement on	263
June 30, 2010, and a valid Medicaid provider agreement during	264
fiscal year 2011 notwithstanding anything to the contrary in	265
sections 5111.20 to 5111.33 of the Revised Code.	266

Section 4. That existing Section 309.30.25 of Am. Sub. H.B. 1	267
of the 128th General Assembly, as amended by Sub. H.B. 198 of the	268
128th General Assembly, is hereby repealed.	269

Section 5. That Section 309.30.70 of Am. Sub. H.B. 1 of the	270
128th General Assembly is hereby repealed.	271

Section 6. (A) As used in this section:

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"ICF/MR" means an intermediate care facility for the mentally	273
retarded as defined in section 5111.20 of the Revised Code.	274

"ICF/MR services" means services covered by the Medicaid	275
program that an ICF/MR provides to a Medicaid recipient who is	276
eligible for the services.	277

"Provider" and "provider agreement" have the same meanings as	278
in section 5111.20 of the Revised Code.	279

(B) The provider of an ICF/MR shall be paid the amount	280
determined for the ICF/MR under sections 5111.20 to 5111.34 of the	281
Revised Code for each month during fiscal year 2011 for which the	282
provider has a valid provider agreement for the ICF/MR and during	283
which the ICF/MR provides ICF/MR services. During fiscal year	284
2011, the Department of Job and Family Services shall make each	285
monthly payment that is due a provider under this section.	286

(C) If, pursuant to former Section 309.30.70 of Am. Sub. H.B.	287
1 of the 128th General Assembly, a provider of an ICF/MR was paid	288
an amount for providing ICF/MR services during a month occurring	289
in fiscal year 2011 and the amount that was paid is less than the	290
amount the provider is to be paid pursuant to division (B) of this	291
section, the Department of Job and Family Services shall pay the	292
provider the difference between the amount that was paid and the	293
amount that is to be paid.	294

Section 7. (A) As used in this section:

295

(1) "Franchise permit fee" means the fee imposed by sections	296
3721.50 to 3721.58 of the Revised Code.	297

(2) "Hospital" and "nursing home" have the same meanings as	298
in section 3721.50 of the Revised Code.	299

(B) The Department of Job and Family Services shall	300
redetermine each nursing home's and hospital's franchise permit	301
fee for the last quarter of fiscal year 2010 using a franchise	302
permit fee rate of six dollars and twenty-five cents. The	303
Department shall mail to each nursing home and hospital notice of	304
the redetermination. If, before the effective date of this	305
section, a nursing home or hospital has already paid its franchise	306
permit fee for the last quarter of fiscal year 2010 and the amount	307
the nursing home or hospital paid is higher than the amount	308
redetermined for the nursing home or hospital, the Department	309
shall reimburse the nursing home or hospital the amount of the	310
difference.	311