Subsection 144-101-III-107-7 - COST ALLOCATION PLANS AND CHANGES IN ACCOUNTING METHODSWith respect to the allocation of costs to the PRTF and within the PRTF, the following rules shall apply:
7.1 Providers that have costs allocated from related entities included in their cost reports shall include as a part of their cost report submission, a summary of the allocated costs, including a reconciliation of the allocated costs to the entity's financial statements which must also be submitted with the MaineCare cost report. In the case of a home office, related management company, or real estate management company, this would include a completed Home Office Cost Statement that shows the costs that are removed which are unallowable. The provider shall submit this reconciliation with the MaineCare cost report.7.2 No change in accounting methods or basis of cost allocation may be made without written prior approval from the Division of Audit.7.3 Any application for a change in accounting method or basis of cost allocation, which has an effect on the amount of allowable costs or computation of the interim rate of payment, shall be made within the first ninety (90) days of the reporting year. The application shall specify: 7.3.1 the nature of the change;7.3.2 the reason for the change;7.3.3 the effect of the change on the interim rate of payment; and 7.3.4 the likely effect of the change on future rates of payment.7.4 The Department shall review each application and within sixty (60) days of the receipt of the application approve, deny or propose modification of the requested change. If no action is taken within the specified period, the application will be deemed to have been approved.7.5 Each provider shall notify the Department of changes in statistical allocations or record keeping required by the Medicare Intermediary.7.6 The capital component (any element of fixed cost that is included in the price charged by a supplier of goods or services) of purchased goods or services, such as plant operation and maintenance, utilities, dietary, laundry, housekeeping, and all others, whether or not acquired from a related party, shall be considered as costs for the particular good or service and not classified as Property and Related costs (fixed costs) of the PRTF.7.7 Costs allocated to the PRTF shall be reasonable and necessary, as determined by the Department pursuant to these rules.7.8 It is the duty of the provider to notify the Division of Audit within five (5) days of any change in its customary charges to the general public. A rate schedule may be submitted to the Department by the PRTF to satisfy this requirement if the schedule allows the Department the ability to determine with certainty the charge structure of the PRTF.7.9 All year-end accruals must be paid by the PRTF within six (6) months after the end of the fiscal year in which the amounts are accrued. If the accruals are not paid within such time, these amounts will be deducted from allowable costs incurred in the first field or desk audit conducted following that six-month period.7.10 The unit of output for cost finding shall be the costs of routine services per resident day. The same cost finding method shall be used for all PRTFs. Total allowable costs shall be divided by the actual days of care to determine the cost per bed day. Total allowable costs shall be allocated based on the occupancy data reported and the following statistical bases:
7.10.1 Plant operation and maintenance. Square feet serviced.7.10.2 Housekeeping. Square feet serviced.7.10.3 Laundry. Resident days, or pounds of laundry, whichever is most appropriate.7.10.4 Dietary. Number of meals served.7.10.5 General and Administrative and Financial and Other Expenses. Total accumulated costs not including General and Administrative and Financial Expense. C.M.R. 10, 144, ch. 101, ch. III, 144-101-III-107, subsec. 144-101-III-107-7