Section 1200-13-02-.10 - CHANGES OF OWNERSHIP OF EXISTING NURSING FACILITIES(1) A CHOW exists if the beds of the new owner have previously been certified to participate, or otherwise participated, in the Medicaid program under the previous owner's provider agreement. Rates paid to NF providers that have undergone a CHOW will be calculated in the following manner: (a) The initial NF provider reimbursement rate will be based upon the acuity, costs, days, appraisal data and quality information of the prior owner.(b) If the CHOW is as a result of a non-related party transaction, the new NF provider may request from TennCare a provisional waiver of the application of any direct care spending floor rate reduction that would otherwise occur. If a direct care spending floor provisional waiver is granted by TennCare, the new NF provider reimbursement rate will be determined without a direct care spending floor reduction. However, for the entire period when a provisional waiver of the direct care spending floor is in effect, the new NF provider will be subject to a retroactive direct care spending floor settlement process, as follows: 1. If the new NF provider's cost reporting period(s) Medicaid direct care cost per diem(s) are less than the spending floor(s) calculated at each rate period, the new NF provider will be responsible for a retroactive recoupment of the difference between its cost per diem and the spending floor for each Medicaid paid day. At no time will the retroactive recoupment per diem exceed the per diem amount granted under the provisional waiver.2. In the event there is more than one direct care spending floor active during the new provider's cost reporting period(s), the direct care spending floor settlement process will be independently applied to each spending floor. If the new NF provider's cost reporting period(s) Medicaid direct care cost per diem(s) are less than any of the active spending floor(s), the calculated differences will be multiplied by the number of provider paid Medicaid days associated with the time period each direct care spending floor was active during the applicable cost reporting period. At no time will the retroactive recoupment per diem exceed the per diem amount granted under the provisional waiver.3. Provisional waivers of the direct care spending floor will not be granted following the first rebase period in which the new NF provider has a six (6) month or more cost reporting period that could have been used in a rebase period.(c) If the CHOW is as a result of a non-related party transaction, the new NF provider's real estate tax cost-based reimbursement rate will be recalculated, according to Rule .06, on the first July 1st after the new NF provider has submitted a cost report of six (6) months or longer, and that cost report has been reviewed by the Comptroller.(2) The previous owner and current owner must comply with the cost report filing requirements in Rule .05.(3) TennCare maintains the right to withhold up to ten percent (10%) of the previous owner's final Medicaid program payments until an acceptable final (terminating) cost report is received by the Comptroller. After receipt of the acceptable cost report, be it timely or non-timely, the withholding amount will be released to the facility (less any incurred penalties for non-timely filing).(4) When there is a proposed CHOW of any Nursing Facility, the new provider shall provide to TennCare documents sufficient to obtain a Medicaid ID as specified in TennCare policy. TennCare shall issue a new Medicaid ID based on appropriate documentation submitted by the new provider. Any Managed Care Contractor (MCC) previously contracted with the former owner or operator shall, subject to T.C.A § 71-5-1412, enter into a provider agreement with the new owner/operator. A new provider with a Medicaid ID shall be reimbursed at one hundred percent (100%) from the effective date of the CHOW. A new provider with a CHOW that has not acquired a Medicaid ID shall not be reimbursed, including retroactively, until such provider acquires a Medicaid ID.Tenn. Comp. R. & Regs. 1200-13-02-.10
Original rules filed May 1, 2018; effective 7/30/2018.Authority: T.C.A. §§ 4-5-202, 71-5-105, 71-5-109, and 71-5-1413.