Current through Register Vol. 44, No. 18, September 25, 2021

Special definitions relating to nursing facility reimbursement:

1. "Acquisition Cost" means the actual allowable cost to the owners of a capital-related asset or any improvement thereto as determined in accordance with generally accepted accounting principles.
2. "Actual cost" or "cost" means the audited cost of providing services.
3. "Administration and General Services Costs" means costs as defined at 10 CCR 2505-10 section 8.443.8.
4. "Appraised value" means the determination by a qualified appraiser who is a member of an institute of real estate appraisers, or its equivalent, of the depreciated cost of replacement of a capital-related asset to its current owner. The depreciated replacement appraisal shall be based on the "Boechk Commercial Underwriter's Valuation System for Nursing Homes."

The depreciated cost of replacement appraisal shall be redetermined every four years by new appraisals of the nursing facilities. The new appraisals shall be based upon rules promulgated by the state board.

5. "Array of facility providers" means a listing in order from lowest per diem cost facility to highest for that category of costs or rates, as may be applicable, of all Medicaid-participating nursing facility providers in the state.
a. "Base value" means:
i) The appraised value of a capital-related asset for the fiscal year 1986-87 and every fourth year thereafter.
ii) The most recent appraisal together with fifty percent of any increase or decrease each year since the last appraisal, as reflected in the index, for each year in which an appraisal is not done pursuant to subparagraph (i) of this paragraph (a).
b. For the fiscal year 1985-86, the base value shall not exceed twenty-five thousand dollars per licensed bed at any participating facility, and, for each succeeding fiscal year, the base value shall not exceed the previous year's limitation adjusted by any increase or decrease in the index.
c. An improvement to a capital -related asset, which is an addition to that asset, as defined by rules adopted by the state board, shall increase the base value by the acquisition cost of the improvement.
7. "Capital-related asset" means the land, buildings, and fixed equipment of a participating facility.
8. "Case-mix" means a relative score or weight assigned for a given group of residents based upon their levels of resources, consumption, and needs.
9. "Case-mix adjusted direct health care services costs" means those costs comprising the compensation, salaries, bonuses, workers' compensation, employer -contributed taxes, and other employment benefits attributable to a nursing facility provider's direct care nursing staff whether employed directly or as contract employees, including but not limited to DONs, registered nurses, licensed practical nurses, certified nurse aides and restorative nurses.
10. "Case-mix index" means a numeric score assigned to each nursing facility resident based upon a resident's physical and mental condition that reflects the amount of relative resources required to provide care to that resident.
11. "Case-mix neutral" means the direct health care costs of all facilities adjusted to a common case-mix.
12. "Case-mix reimbursement" means a payment system that reimburses each facility according to the resource consumption in treating its case-mix of Medicaid residents, which case-mix may include such factors as the age, health status, resource utilization, and diagnoses of the facility's Medicaid residents as further specified in this section.
13. "Class I facility" means a private for -profit or not-for-profit nursing facility provider or a facility provider operated by the state of Colorado, a county, a city and county, or special district that provides general skilled nursing facility care to residents who require twenty-four-hour nursing care and services due to their ages, infirmity, or health care conditions, including residents who are behaviorally challenged by virtue of severe mental illness or dementia. Swing bed facilities are not included as class I facilities.
14. "Core Components" means the health care, administrative and general and fair rental allowance for capital -related assets prospective per diem rate components.
15. "Direct health care services costs" means those costs subject to case-mix adjusted direct health care services costs.
16. "Direct or indirect health care services costs" means the costs incurred for patient support services as defined at 10 CCR 2505-10 section 8.443.7.
17. "Facility population distribution" means the number of Colorado nursing facility residents who are classified into each resource utilization group as of a specific point in time.
18. "Fair rental allowance" means the product obtained by multiplying the base value of a capital -related asset by the rental rate.
19. "Improvement" means the addition to a capital -related asset of land, buildings, or fixed equipment.
20. "Index" means the R. S. Means construction systems cost index or an equivalent index that is based upon a survey of prices of common building materials and wage rates for nursing home construction.
21. "Index maximization" means classifying a resident who could be assigned to more than one category to the category with the highest case-mix index.
22. "Median per diem cost" means the daily cost of care and services per patient for the nursing facility provider that represents the middle of all of the arrayed facilities participating as providers or as the number of arrayed facilities may dictate, the mean of the two middle providers.
23. "Minimum data set" means a set of screening, clinical, and functional status elements that are used in the assessment of a nursing facility provider's residents under the Medicare and Medicaid programs.
24. "Normalization ratio" means the statewide average case-mix index divided by the facility's cost report period case-mix index.
25. "Normalized" means multiplying the nursing facility provider's per diem case-mix adjusted direct health care services cost by its case-mix index normalization ratio for the purpose of making the per diem cost comparable among facilities based upon a common case-mix in order to determine the maximum allowable reimbursement limitation.
26. "Nursing facility provider" means a facility provider that meets the state nursing facility licensing standards established pursuant to C.R.S. section 25-1.5-103 , and is maintained primarily for the care and treatment of inpatients under the direction of a physician.
27. "Nursing salary ratios" means the relative difference in hourly wages of registered nurses, licensed practical nurses, and nurse's aides.
28. "Nursing weights" means numeric scores assigned to each category of the resource utilization groups that measure the relative amount of resources required to provide nursing care to a nursing facility provider's residents.
29. "Occupancy-imputed days" means the use of a predetermined number for patient days rather than actual patient days in computing per diem cost.
30. "Per diem cost" means the daily cost of care and services per patient for a nursing facility provider.
31. "Per diem rate" means the daily dollar amount of reimbursement that the state department shall pay a nursing facility provider per patient.
32. "Provider fee" means a licensing fee, assessment, or other mandatory payment as specified under 42 CFR section 433.55.
33. "Raw food" means the food products and substances, including but not limited to nutritional supplements, that are consumed by residents.
34. "Rental rate" means the average annualized composite rate for United States treasury bonds issued for periods of ten years and longer plus two percent. The rental rate shall not exceed ten and three-quarters percent nor fall below eight and one-quarter percent.
35. "Resource utilization group" (RUG) means the system for grouping a nursing facility's residents according to their clinical and functional status identified from data supplied by the facility's minimum data set as published by the United States Department of Health and Human Services.
36. "Statewide average per diem rate" means the average daily dollar amount of the per patient payments to all Medicaid-participating facility providers in the state.
37. "Medicare patient day" means all days paid for by Medicare. For instance, a Medicare patient day includes those days where Medicare pays a Managed Care Organization for the resident's care.
38. "Per diem fee" means the daily dollar amount of provider fee that the state department shall charge a nursing facility provider per non-Medicare day.
39. "Substandard Quality of Care means one or more deficiencies related to participation requirements under 42 CFR section 483.13 , resident behavior and facility practices, 42 CFR section 483.15 , quality of life, or 42 CFR section 483.25 , quality of care, that constitute either immediate jeopardy to resident health or safety (level J, K, or L); a pattern of widespread actual harm that is not immediate jeopardy (level H or I); or a widespread potential for more than minimal harm, but less than immediate jeopardy, with no actual harm (level F)" per State Operations Manual, chapter 7.
40. "Supplemental Medicaid Payment" means a lump sum payment that is made in addition to a provider's per diem rate. A supplemental Medicaid payment is calculated on an annual basis using historical data and paid as a fixed monthly amount with no retroactive adjustment.


Sections 8.440 emer. rule eff. 04/10/2009.
Sections 8.440 emer. rule eff. 05/08/2009; 8.440 expired 8/8/2009.
Sections 8.440 eff. 08/30/2009.
38 CR 07, April 10, 2015, effective 5/1/2015

The following state regulations pages link to this page.

State regulations are updated quarterly; we currently have two versions available. Below is a comparison between our most recent version and the prior quarterly release. More comparison features will be added as we have more versions to compare.