SB 1111 — AN ACT ESTABLISHING A WORKING GROUP TO STUDY EXCESS LICENSED BED CAPACITY AT SKILLED NURSING FACILITIES.

Senate General Assembly RaisedFile Bill No.

1111560 January Session, 2023 LCOSubstitute Senate Bill No.

45771111 ReferredSenate, toApril 13, 2023 The Committee on HUMANHuman SERVICESServices Introducedreported by:through SEN.

(HS)LESSER ANof ACTthe CONCERNING9th EXCESSDist., NURSINGChairperson HOMEof BEDSthe ANDCommittee PAYMENTon FORthe NONPATIENTpart CAREof INthe NURSINGSenate, HOMES.that the substitute bill ought to pass.

AN ACT ESTABLISHING A WORKING GROUP TO STUDY EXCESS LICENSED BED CAPACITY AT SKILLED NURSING FACILITIES.

Section(Effective 17b-340dfrom passage) (a) The Commissioner of theSocial generalServices statutesshall isappoint repealedand convene a working group of eight members to review and evaluate the followingincidence isand substitutedimplications of excess licensed bed capacity and any space not presently in lieuuse thereofin (Effectiveskilled fromnursing passage):facilities.

(a)Such Thereview Commissionerand ofevaluation Social Services shall implementinclude, anbut acuity-need basednot methodologybe forlimited Medicaidto: reimbursement of nursing home services effective July 1, 2022.

Notwithstanding(1) sectionA 17b-340,survey forof theexcess fiscallicensed yearbed endingcapacity Juneand 30,any 2023,space andnot annuallypresently thereafter,in use that identifies (A) licensed bed capacity, occupancy percentages and the Commissioneridentification and location within a skilled nursing facility of Sociallicensed Servicesbeds shallnot establishpresently Medicaidin ratesoperation paidin toa nursingclosed homefacility facilitieswing basedor onelsewhere costin yearsthe endingfacility, on(B) Septemberbeds thirtiethvoluntarily taken out of service in accordancean withopen portion of the following:facility but where the beds remain counted in the facility's licensed beds capacity, (C) any other space not presently in use that was formerly used for skilled nursing facility care, services and operations, and (D) beds made unavailable due to inability sSB1111 / File No.

(1)560 Case-mix1 adjustmentssSB1111 toFile theNo. direct care component, which will be based on Minimum Data Set resident assessment data as well as cost data reported for the cost year ending September 30, 2019, shall be made effective beginning July 1, 2022, and updated every quarter thereafter.

After560 modelingto suchstaff case-mixat adjustments,minimum thelevels Commissionerin ofaccordance Socialwith Servicessection shall19a-563h evaluateof impactthe ongeneral astatutes facilityor byoperator-preferred facilitystaffing basislevels; and, not later LCO No.

4577(2) 1a ofreview 5and Raisedevaluation Billof No.1111the thanefficiency Octoberand 1,effectiveness 2021,of (A)Medicaid makepayment recommendationspolicies designed to thediscourage, Secretaryencourage, ofpenalize theor Officeincentivize ofexcess Policybed andcapacity Management,in andMedicaid (B)payment submitrates, aincluding, reportbut onnot thelimited recommendations,to, in(A) accordanceminimum withoccupancy therate-setting provisionsrequirements, ofand section(B) 11-4a,a toprice-based component for the jointadministrative standingand committeesgeneral component of thereimbursement Generalbased Assemblyon havingthe cognizanceofmattersrelatingtomedian appropriationsandthebudgetsofstateof agenciesandhumanservicesthe onanyadjustmentsneededtofacilitatethepeer transitiongroup tospending in the newadministrative methodologyand ongeneral Julycomponent 1,of 2022.the rates;

This(3) evaluation may include a review of inflationary allowances, case mix and budgetevaluation adjustmentof factorsthe andmitigating stopimplications lossof andstaffing stopshortages gainas corridorsan andimpediment the ability to makeskilled suchnursing adjustmentsfacility withinadmissions availableand appropriations.occupancy;

(2) Beginning July 1, 2022, facilities will be required to comply with collection and reporting(4) ofconsideration quality metrics as specified by the Department of Social Services, after consultation with the nursingphysical homeplant industry,conditions consumers,of employees and the Departmentexisting ofskilled Publicnursing Health.facilities.

Rate(b) adjustmentsThe basedworking ongroup performancemembers onshall qualitybe: metrics will be phased in, beginning July 1, 2022, with a period of reporting only.

(3)(1) GeographicTwo peerrepresentatives groupingsfrom of facilities shall be established by the Department of Social ServicesServices, pursuantone toof regulationswhom adoptedshall inbe accordancefrom withthe subsectioncertificate [(b)]of (d)need ofand thisrate section.setting division;

(4)(2) Allowabletwo costsrepresentatives from the Department of Public Health, one of whom shall be dividedfrom into the followingfacilities fivelicensing costdivision components:and one of whom shall be from the life safety division;

(A)(3) Directtwo costs,representatives whichfrom shallan includeorganization salariesor fororganizations nursingrepresenting personnel,long-term relatedcare fringefacilities, benefitsincluding, andbut costsnot forlimited nursingto, personnelassisted suppliedliving byfacilities; a temporary nursing services agency;

(B)and indirect(4) costs,two whichrepresentatives shallfrom includean professionalorganization fees,representing dietarynonprofit, expenses,long-term housekeeping expenses, laundry expenses, supplies related to patient care, salaries for indirect care personnelfacilities. and related fringe benefits;

(C)The fairchairpersonsoftheworkinggroupmayinvitetheparticipationofothers rent,with whichsubject shallmatter beknowledge definedthat inmay regulationsbe adoptedneeded in accordancethe withreview subsectionand (b)evaluation. of this section;

(D)(c) capital-relatedThe costs,chairpersons whichof the working group shall includebe propertyone taxes,representative insuranceof expenses,the equipmentDepartment leasesof Social Services appointed pursuant to subdivision (1) of subsection (b) of this section and equipmentone depreciation;member of the working group chosen by the members of the group.

andThe (E)Commissioner administrativeof andSocial generalServices, costs,or whichthe shallcommissioner's includedesignee, maintenanceshall andschedule operationthe offirst plantmeeting expenses,oftheworkinggroupnot salarieslater forthansixty administrativedaysafter andtheeffective maintenancedate personnelof andthis relatedsection. fringe benefits.

For(d) (i)Not directlater costs,than theDecember maximum31, cost2023, shallthe beworking equalgroup toshall onesubmit hundredsSB1111 LCO/ File No.

4577560 2 ofsSB1111 5File RaisedNo. Bill No.1111 thirty-five per cent of the median allowable cost of that peer grouping;

(ii)560 indirectan costs,interim thereport, maximumand costnot shalllater bethan equalJune 30, 2024, a final report on its findings and recommendations to onethe hundredjoint fifteenstanding percommittee centof the General Assembly having cognizance of matters relating to human services, in accordance with the state-wideprovisions medianof allowablesection cost;11-4a of the general statutes.

(iii) fair rent, the amount shall be calculated utilizing the amount approved pursuant to section 17b-353;

(iv) capital-related costs, there shall be no maximum;

and (v) administrative and general costs, the maximum shall be equal to the state-wide median allowable cost.

For purposes of this subdivision, "temporary nursing services agency" and "nursing personnel" have the same meaning as provided in section 19a-118.

(5) For the fiscal year ending June 30, 2022, the commissioner may, in the commissioner's discretion and within available appropriations, provide pro rata fair rent increases to facilities which have documented fair rent additions placed in service in the cost report year ending September 30, 2020, that are not otherwise included in the rates issued.

(6) There shall be no increase to rates based on inflation or any inflationary factor for the fiscal years ending June 30, 2022, and June 30, 2023, unless otherwise authorized under subdivision (1) of this subsection.

(7) For purposes of computing minimum allowable patient days, utilizationofa facility'scertifiedbedsshall be determinedat aminimum of ninety per cent of capacity, except for facilities that have undergone a change in ownership, new facilities, and facilities which are certified for additional beds which may be permitted a lower occupancy rate for the first three months of operation after the effective date of licensure.

(8) Rates determined under this section shall comply with federal laws and regulations.

(b) On and after April 1, 2025, administrative and general-related costs shall be adjusted for a nursing home facility with beds that remain unoccupied for more than twelve months in the period beginning October first at facilities that have fallen below the minimum ninety per cent occupancy threshold.

If the facility does not relinquish its license for unoccupied beds or does not increase occupancy percentages to LCO No.

4577 3 of 5 Raised Bill No.1111 greater than ninety per cent, then the facility's reimbursement for administrative and general-related costs shall be reduced to ninety per cent of the median of the cost maximums for the administrative and general component of allowable costs, as described in subdivision (4) of subsection (a) of this section.

(c) On and after July 1, 2024, the Department of Social Services shall establish peer group medians and prices for nursing home facilities by using data from the most recent annual cost reports filed by the nursing home facilities.

Peer groups shall be based on the bed capacity and location of the nursing home facility.

The department shall classify the nursing home facilities into mutually exclusive peer groups to establish a price-based component for the administrative and general component of reimbursement and pay based on the median of the peer group spending.

The Department of Social Services shall consult with entities and persons involved in the operation of nursing home facilities, including, but not limited to, the Department of Public Health, regarding the establishment of peer groupings to ensure geographic access and available capacity.

A nursing home facility that is licensed as a specialized long-term care facility or unit with specialized rates, including, but not limited to, a unit providing ventilator services or services to persons with acquired immune deficiency syndrome, shall be classified into mutually exclusive peer group classifications.