DEPARTMENT OF HUMAN SERVICES __________

TOTAL $1,000,000

SUMMARY

This bill makes modifications to the reimbursement system to more accurately reflect the actual cost of services in all segments of the continuum of long-term care. The bill requires the Department of Human Services to utilize 1997 data, rather than 1993 data as is currently the standard, for calculating reimbursement rates and cost components; provides for calculation of a facility's case mix based on the facility's total population, regardless of source of payment; reclassifies certain cost components as direct costs; and directs the department to establish annually the maximum reimbursement rates by taking into account the size of the facility and by utilizing current year- end data. It also directs the department to recognize as an allowable fixed cost the nursing facility's allocated share of debt service or outstanding debt resulting from either the sale of licensed beds by a facility or the closure of a nursing facility.

The bill also establishes the Medicaid Automation Grant Fund for the purpose of facilitating the improved efficiency of facility operations. The bill authorizes the department to establish criteria for approving disbursements from the fund to facilities.

The bill repeals the requirement that a nursing facility that participates in the Medicaid program also must participate in the Medicare program as a skilled nursing facility.

The bill provides facilities with a limited opportunity to utilize nursing facility beds for the provision of residential care services if there are no residential care beds available within 25 miles of that facility or if necessary to meet the care needs of an existing resident.

The bill addresses the problem of an existing over-supply of nursing facility beds, estimated by the department to be approximately 1,200. The department is authorized to entertain proposals from nursing facilities to sell some or all of their licensed beds back to the department. The bill provides funding for this purpose through loans from Maine Health and Higher Educational Facilities Authority, the debt service on which will