Provides for the payment of capitated rates for services provided by assisted living programs, whether free-standing or not.
TITLE OF BILL: An act to amend the public health law, in relation to capitated rates of payment for services provided by assisted living programs
PURPOSE: This bill will give the Commissioner authority to expand the criteria for ALPs to obtain Medicaid reimbursement for real property capital construction costs.
SUMMARY OF SPECIFIC PROVISIONS: Section one of the bill amends subdivision 6 of section 3614 of the public health law, by amending paragraphs (a) and (b) to broaden the criteria for eligibility for capital reimbursement.
Section two provides for an immediate effective date.
JUSTIFICATION: Currently, there is a very small capital component in the Medicaid ALP rate, which does not reflect current true capital costs. Current state policy is encouraging a transition from nursing home beds to ALP beds to "rightsize" the system of care. This initiative will help save Medicaid dollars by enabling low-income seniors and other individuals in need of care to reside in ALPs at half the cost of the nursing home rate. It also enables residents to live in a more home-like, community-oriented setting. Rightsizing projects are impossible without capital funding, however.
In addition, many of the original ALP programs (or adult care facilities seeking ALP licensure) are housed in aging buildings that require significant capital improvements to update physical plants to meet the needs of more frail residents who might otherwise need nursing home care. Funding is needed for resident safety and quality of life, as well as to meet increasing structural requirements imposed by the Department of Health.
This bill amends existing law by allowing Medicaid reimbursement for real property capital construction costs for certain ALPs. Providing a capital component in the ALP rate for these facilities will enable true rightsizing of long term care. The viability of the ALP program is essential because Medicaid eligible individuals who need ALP services will go to a nursing home at a greater cost if there is no ALP bed available in their community. The ALP is the only assisted living option for Medicaid-eligible individuals, whether they are seniors or individuals suffering from HIV/AIDS and related complications, who need care but at a level less intensive than skilled nursing care. Finally, this bill specifically requires that the capital component will only be available for facilities that are able to establish with the Department of Health that the conversion will result in net fiscal savings to the state, thereby ensuring the cost-effectiveness of this legislation.
PRIOR LEGISLATIVE HISTORY: New Bill.
FISCAL IMPLICATIONS: None to the State as Commissioner must determine that it will result in a net fiscal savings to the state.
EFFECTIVE DATE: Immediately.
STATE OF NEW YORK ________________________________________________________________________ 4918--A 2011-2012 Regular Sessions IN SENATE April 29, 2011 ___________Introduced by Sen. HANNON -- read twice and ordered printed, and when printed to be committed to the Committee on Health -- reported favora- bly from said committee and committed to the Committee on Finance -- committee discharged, bill amended, ordered reprinted as amended and recommitted to said committee AN ACT to amend the public health law, in relation to capitated rates of payment for services provided by assisted living programs THE PEOPLE OF THE STATE OF NEW YORK, REPRESENTED IN SENATE AND ASSEM- BLY, DO ENACT AS FOLLOWS: Section 1. Paragraphs (a) and (b) of subdivision 6 of section 3614 of the public health law, paragraph (a) as amended by section 17 of part D of chapter 58 of the laws of 2009 and paragraph (b) as added by chapter 645 of the laws of 2003, is amended to read as follows: (a) The commissioner shall, subject to the approval of the state director of the budget, establish capitated rates of payment for services provided by assisted living programs as defined by paragraph (a) of subdivision one of section four hundred sixty-one-l of the social services law. Such rates of payment shall be related to costs incurred by residential health care facilities. The rates shall reflect (I) the wage equalization factor established by the commissioner for residential health care facilities in the region in which the assisted living program is provided, and (II) real property capital construction costs associated with the construction of (A) a free-standing assisted living program, OR (B) OTHER ASSISTED LIVING PROGRAMS FOR WHICH THE COMMISSION- ER DETERMINES THAT SUCH REAL PROPERTY CAPITAL CONSTRUCTION COST ADJUST- MENT WOULD PROVIDE NET FISCAL SAVINGS TO THE STATE; such rate shall include a payment equal to the cost of interest owed and depreciation costs of such construction. The rates shall also reflect the efficient provision of a quality and quantity of services to patients in such residential health care facilities, with needs comparable to the needs of residents served in such assisted living programs. Such rates ofEXPLANATION--Matter in ITALICS (underscored) is new; matter in brackets [ ] is old law to be omitted. LBD11023-03-1 S. 4918--A 2
payment shall be equal to fifty percent of the amounts which otherwise would have been expended, based upon the mean prices for the first of July, nineteen hundred ninety-two (utilizing nineteen hundred eighty- three costs) for freestanding, low intensity residential health care facilities with less than three hundred beds, and for years subsequent to nineteen hundred ninety-two, adjusted for inflation in accordance with the provisions of subdivision ten of section twenty-eight hundred seven-c of this chapter, to provide the appropriate level of care for such residents in residential health care facilities in the applicable wage equalization factor regions plus an amount equal to capital construction costs associated with the construction of an assisted living program facility as provided for in this subdivision. (b) For purposes of this subdivision, real property capital construction costs shall only be included in rates of payment for assisted living programs if: (i) the facility is operated by a not-for- profit corporation; (ii) the facility commenced operation after nineteen hundred ninety-eight and at least ninety-five percent of the certified approved ADULT CARE FACILITY beds, AS APPLICABLE, are provided to resi- dents who are subject to the assisted living program; and (iii) WITH RESPECT TO AN ASSISTED LIVING PROGRAM UNDER CLAUSE (A) OF SUBPARAGRAPH (II) OF PARAGRAPH (A) OF THIS SUBDIVISION, the assisted living program is in a county with a population of no less than two hundred eighty thousand persons. The methodology used to calculate the rate for such capital construction costs shall be the same methodology used to calcu- late the capital construction costs at residential health care facili- ties for such costs. S 2. This act shall take effect immediately.