N.Y. Comp. Codes R. & Regs. tit. 10 § 86-1.14

Current through Register Vol. 46, No. 19, May 8, 2024

Section 86-1.14 - Allowance for certified home health agencies providing a disproportionate share of bad debt and charity care

(a) Basic rates of payment by governmental agencies for voluntary nonprofit, private proprietary and publicly sponsored nonhospital based certified home health agencies which can demonstrate losses as a result of providing a disproportionate share of bad debt and charity care, shall include a bad debt and charity care allowance.

(b) The provisions of this section shall apply to rates of payment during the period July 1, 1990 through December 31, 1990, and for each calendar year period commencing on January first thereafter. The provisions of this section shall be effective, if, and as long as, Federal financial participation is available for expenditures made for the allowance for beneficiaries eligible for medical assistance under title XIX of the Federal Social Security Act.

(c) Eligibility shall be limited to voluntary nonprofit, private proprietary and publicly sponsored nonhospital based certified home health agencies which meet the following criteria:

(1) the facility must ensure the availability of patient service 24 hours a day, 7 days a week as specified in section 763.3(d) of this Title;

(2) the facility must demonstrate compliance with minimum charity care service requirements specified in section 763.11(a)(11) of this Title;

(3) the facility must receive a cost based Medicaid reimbursement rate pursuant to section 86-1.46 of this Title;

(4) the facility must be able to demonstrate upon request, that it has made reasonable efforts to maintain financial support from community and public funding sources;

(5) the facility must be able to demonstrate upon request, that it has made reasonable efforts to collect payments for services from third-party insurance payors, governmental payors and self-paying patients; and

(6) the facility must have no petition for bankruptcy filed under either chapter 7 or 11 of Title 11 of the U.S. Code. The commissioner may waive this criteria if the facility demonstrates that it is financially viable or a potentially financially viable organization with a comprehensive plan to maintain fiscal integrity.

(d) An annual aggregate amount set forth in statute (see Public Health Law, section 3614[5]) shall be allocated and distributed between public and nonpublic facilities. Publicly sponsored facilities shall receive an annual allocation of no more than 35 percent of total available funds. The commissioner may adjust the apportionment of funds to be distributed between public and nonpublic facilities. The commissioner shall consider, but not be limited to, the following factors in establishing the annual apportionment of funds to publicly sponsored facilities:

(1) the ratio of public to nonpublic base year period bad debt and charity care provided by eligible facilities as defined in paragraph (e)(2) of this section; and

(2) the differences between public and nonpublic facilities in the total allowable costs for delivering services.

(e) Allowances shall be established on a prospective basis and shall be computed on the basis of allowable fiscal and statistical data submitted by each facility for the base reporting period for the rate year for which allowances are being set. The bad debt and charity care allowance shall be paid as an addition to eligible nursing rates of payment. The amount to be paid will be calculated by dividing each eligible facility's bad debt and charity care loss by base year Medicaid nursing visits.

(1) Eligible losses will be calculated by applying a facility's Medicaid rate of payment for the rate period for which the allowance is being determined, to identified base year eligible visits or units of service.

(2) An eligible visit shall be defined as the unit of service upon which title XIX payment is based provided, however, to an individual who after a reasonable period of time appears to be unable to pay all or a portion of the payment due for the service, except for those portions of the payment due which are covered by a government agency, insurer or third-party payor, including payment made directly to the certified home health agency and indemnity or similar payment.

(3) All payments received in the base year directly for eligible visits and government and entitlement revenues obtained for the purpose of subsidizing the certified home health agency's general operating expenses shall be offset against eligible costs to arrive at an eligible loss under this section. For publicly sponsored facilities, the department shall offset all base year article 6 local assistance revenues associated with home health care operations.

(4) An annual amountof loss coverage will be calculated by applying eligible losses against the following nominal loss coverage formula:

Percent of bad debt & charity care losses to total operating costs	Nominal percent of loss coverage
up to 3%	50%
3% to6%	75%
6% plus	100%

The nominal loss coverage percentages may be increased to not more than 100 percent for nonpublic or publicly sponsored nonhospital based certified home health agencies, if the sum of the nominal payments for all eligible nonpublic or publicly sponsored facilities is less than the amounts allocated for either group.

(5) Separate coverage ratios shall be established for nonpublic and publicly sponsored nonhospital based certified home health agencies in order to make the allocation described in subdivision (d) of this section. These coverage ratios will consist of the aggregate nominal losses for nonpublic and publicly sponsored nonhospital based certified home health agencies divided into nonpublic and publicly sponsored disproportionate share allocations, as appropriate. These coverage ratios shall be applied to each nonpublic or publicly sponsored nonhospital based certified home health agency's annual amount of bad debt and charity care loss coverage to determine the level of bad debt and charity case losses to be incorporated into each facility's Medicaid rate of payment.

(6) The department may make periodic prospective adjustments to an eligible facility's Medicaid payment to ensure that each facility receives the full amount of the allowance for which it is eligible. In no instance shall a facility receive an allowance which exceeds the maximum amount for which it is eligible under this section. In no event shall a facility receive an allowance in an amount exceeding the facility's need for financing losses associated with the delivery of bad debt and charity care.

(f)

(1) Eligible facilities shall submit to the department a supplement to the cost report used for title XIX (Medicaid) reimbursement. This supplement shall be provided by the department and must be returned to the department within 45 days from the date it is received by facilities for the 1990 and 1991 rate years. Thereafter it shall be submitted to the department with the cost report used for purposes of title XIX reimbursement. The supplement shall include, but not be limited to data related to the number of eligible visits or units of service, the costs of eligible services, patient and third party revenues associated with the eligible services, government and entitlement revenues and article 6 local assistance funding associated with charity care.

(2) Eligible facilities shall maintain statistical and financial reporting systems which permit the collection and reporting of actual visits and revenues associated with the provision of bad debt and charity care services to their patient population. All reported data will be subject to audit. The allowance may be revised based upon audit findings.

(3) Facilities shall provide assurances that they will make and shall document upon request, the reasonable efforts made to maintain financial support from community and public funding sources and to collect payments from third-party payors, governmental payors and self-pay patients.

(4) The commissioner may reduce a current allowance if it is determined that actions or decisions by a facility's management have caused a significant reduction for the rate period in the delivery of home care services to bad debt and charity care patients.

N.Y. Comp. Codes R. & Regs. Tit. 10 § 86-1.14

Amended, New York State Register, Volume XXXVI, Issue 27, effective 7/9/2014