Tenn. Comp. R. & Regs. 1200-13-02-.09 - NEW NURSING FACILITY PROVIDERS

(1) The reimbursement rate for new NF providers will be determined following the methodology detailed in Rules .06 - .08 with the following exceptions:
(a) The provider's Medicaid NF semi-annual case mix index will be calculated as the statewide annualized Medicaid resident day-weighted average Medicaid NF semiannual case mix index until the provider has completed one full semi-annual rate period of operation following the acceptance of Medicaid recipients.
(b) The provider will be exempt from the direct care spending floor until the July 1 rate setting following the date the initial cost report filing is submitted to TennCare, and the Comptroller has completed its review of the cost report filing.
(c) The provider will be included in quality tier three (3) for the rate determination process, as defined in Rule .06, until the July 1 rate setting following the date the provider has submitted at least six (6) consecutive months of quality performance data in order to determine the provider's Quality Tier.
(d) The provider will be included in the new provider class for provider assessment cost-based reimbursement rate purposes. The provider will remain in the new provider class until such time that the provider has its information included in a provider assessment calculation base period. The provider will then receive its provider assessment cost-based reimbursement rate according to its specific provider class attributes as defined in Rule .06.
(e) The provider, if required to pay real estate tax, will receive the statewide annualized Medicaid resident day-weighted average inflated real estate tax cost value. The established real estate cost value will then be divided by the minimum occupancy percentage threshold of eighty-five percent (85%) of annualized bed days available to create the per diem real estate tax portion of the cost-based component of the rate. The per diem real estate tax cost-based rate will remain in effect until at least one of the two timelines and criteria below are met:
1. The July 1 rate setting after the provider has submitted an acceptable initial cost reporting package to the Comptroller and the Comptroller has completed the review of the real estate tax portion of the report. The approved NF provider's real estate tax amount from the Medicaid supplemental cost report is divided by the greater of actual base year cost report resident days, or eighty-five percent (85%) of base year cost report licensed beds capacity of the provider. These costs shall be trended forward from the midpoint of the NF provider's base year cost reporting period to the midpoint of the rate year using the index factor.
2. The semi-annual rate period immediately following compliance with the criteria listed in subparts (i) and (ii). The approved NF provider's real estate tax amount will be divided by the minimum occupancy percentage threshold of eighty-five percent (85%) of the NF provider's annualized licensed bed days available of the provider. No trending factor will be applied as the tax amounts accepted will be assumed to be from the current period.
(i) The provider submits to the Comptroller documentation to support its real estate tax expense for the current cost reporting period. TennCare will be solely responsible for determining the format in which the information must be submitted, and what supporting documentation will be considered acceptable.
(ii) The Comptroller has reviewed the provider submission and has determined it to be acceptable.
(f) The capital component of the reimbursement rate will be determined as follows:
1. An appraisal will be conducted by TennCare's certified appraisal contractor. The appraisal will be utilized in capital component reimbursement consistent with Rule .06.
2. Should an assessment process not be completed prior to the facility accepting Medicaid recipients, the facility will have a maximum of ninety (90) days from the Medicaid certification date to complete the appraisal process.
3. A new facility without an appraisal will receive the maximum total facility value possible under the FRV system until the semi-annual rate period in immediate succession to the completion of the appraisal process. When the appraisal process is complete, the appraisal will be utilized in capital component reimbursement consistent with Rule .06. The annual FRV will be divided by the minimum occupancy percentage threshold to establish the FRV per diem for the NF provider. The minimum occupancy percentage threshold applied to the FRV calculation will be modified for a new facility as follows:
(i) If the NF provider has not previously provided the NF level of care for any payer type, then the minimum occupancy percentage threshold will be calculated as follows:
(I) The minimum occupancy percentage threshold will be calculated at sixty-five percent (65%) of annualized NF provider bed days available until the July 1 rate setting immediately following the NF providers Medicaid certification date.
(II) If the initial July 1 rate setting period occurs prior to the NF provider receiving the sixty-five percent (65%) minimum occupancy percentage threshold for a full semi-annual rate period, then the NF provider will receive a minimum occupancy percentage threshold of seventy-five percent (75%) of annualized NF provider bed days available until the next July 1 rate setting occurs.
(III) All subsequent rate periods will have the minimum occupancy percentage threshold calculated according to capital component reimbursement Rule .06.
(ii) A NF provider that is new to Medicaid certification, but has previously provided NF level of care services, will not be subject to the modified minimum occupancy percentage threshold provisions.
4. If the new facility does not meet the ninety (90) day appraisal completion timeline, the facility will receive the lowest total FRV facility value in the state beginning with the semi-annual rate period in immediate succession to the ninety (90) day timeline expiring. The lowest total FRV facility value will be utilized to set the capital component per diem reimbursement rate according to reimbursement Rule .06. The lowest total FRV facility value mandate will remain in effect for a minimum of one (1) semi-annual rate period, and will remain in effect until the semi-annual period in immediate succession to the facility's completion of the appraisal process. Once the appraisal process is complete and the lowest total FRV facility value mandate period has elapsed, the appraisal will be utilized in capital component reimbursement in line with Rule .06.
5. No modification of the minimum occupancy percentage threshold will be applied for providers who have failed to complete the appraisal process within the required ninety (90) day timeline.
6. An appraisal process will not be determined complete until the appraisal is final.

Notes

Tenn. Comp. R. & Regs. 1200-13-02-.09
Original rules filed May 1, 2018; effective 7/30/2018.

Authority: T.C.A. ยงยง 4-5-202, 71-5-105, 71-5-109, and 71-5-1413.

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