Change in Size or Location of Participating SNF and/or NF

3202 - Change in Size or Location of Participating SNF and/or NF (Rev. 1, 05-21-04) Under §1866 of the Social Security Act (the Act), the Secretary has the authority to enter into an agreement with an institution or an institutional complex to provide covered services to our beneficiaries. The provider agreement requires compliance with the requirements the Secretary deems necessary for participation in the Medicare or Medicaid program. See §1866(b)(2) and §1902 (a)(27) of the Act. On the effective date of the provider agreement, the institution or institutional complex is deemed to have met the requirements for participation based upon a survey of the institution or institutional complex as it was configured (i.e., bed size/bed location configuration) on the date(s) of the survey. The CMS’ authority to regulate bed size changes in a SNF or a NF is based on the authority to ensure compliance with the provider agreement under §1866 of the Act and to further ensure that the configuration that has been approved for the institution or institutional complex does not so drastically change from that of the original certified configuration so as to endanger resident health and safety or otherwise change in a material fashion the identity of the entity that CMS originally certified for program participation. An institution or institutional complex may choose to participate in the Medicare and/or Medicaid programs either in its entirety (i.e., fully participating), or a portion thereof (i.e., a distinct part), but not both. If only a portion of an institution or institutional complex actually participates in either program it is classified as a distinct part and must meet the criteria found in §2762. For example, an institution has 4 wings that consist of 25 beds each. Three contiguous wings that contain 75 beds are dually participating (i.e., participating in Medicare and Medicaid). The fourth wing is only certified to participate in Medicare. It consists of 25 beds. Therefore, in this instance the institution is fully participating for purposes of Medicare (i.e., 100 beds) and a distinct part for purposes of Medicaid (i.e., 75 beds). The policies on bed size changes and changes in designated bed locations that are included in this section apply, regardless of whether an institution is fully participating (i.e., all beds within the institution or institutional complex are certified to participate in the Medicare and/or Medicaid program) or participating as or with a distinct part. A SNF or NF may be: • An entire institution for skilled nursing or rehabilitative care, such as a nursing home; or • A distinct part of an institution such as, a hospital, personal care home, assisted living facility, board and care home, domiciliary care facility, rest home, continuing care retirement community or nursing home. An institution that is primarily for the care and treatment of mental diseases cannot be a SNF or NF. 3202A - Requirements for Distinct Part Certification (Rev. 1, 05-21-04) If the institution or institutional complex is participating as a distinct part SNF and/or NF, for a change to be approved, the requested change in bed size must conform to the requirements to be classified as a distinct part. The term “distinct part” refers to a portion of an institution or institutional complex (e.g., a nursing home or a hospital) that is certified to provide SNF and/or NF services. A distinct part must be physically distinguishable from the larger institution and fiscally separate for cost reporting purposes. An institution or institutional complex can only be certified with one distinct part SNF and/or one distinct part NF. A hospital-based SNF is by definition a distinct part. Multiple certifications within the same institution or institutional complex are strictly prohibited. The distinct part must consist of all beds within the designated area. The distinct part can be a wing, separate building, a floor, a hallway, or one side of a corridor. The beds in the certified distinct part area must be physically separate from (that is, not commingled with) the beds of the institution or institutional complex in which it is located. However, the distinct part need not be confined to a single location within the institution or institutional complex’s physical plant. It may, for example, consist of several floors or wards in a single building or floors or wards that are located throughout several different buildings within the institutional complex. In each case, however, all residents of the distinct part would have to be located in units that are physically separate from those units housing other patients of the institution or institutional complex. Where an institution or institutional complex owns and operates a distinct part SNF and/or NF, that distinct part SNF and/or NF is a single distinct part even if it is operated at various locations throughout the institution or institutional complex. The aggregate of the SNF and/or NF locations represents a single distinct part subprovider, not multiple subproviders, and must be assigned a single provider number. Illustration I - Floor Plan of Nursing Facility Illustration I, above, is an illustration of a floor plan of a nursing facility followed below by examples that meet the requirements for a distinct part, as well as examples that do not meet the requirements for a distinct part. The purpose of the Illustration is to assist the State and the RO in ensuring proper distinct part certification. 3202A1 - Meet Distinct Part Certification (Rev. 1, 05-21-04) An institution or institutional complex can select any one of the following examples discussed in the context of Illustration I above that meets the requirements for distinct part certification. • All rooms numbered 1 through 12 in wing 1 and all rooms numbered 1 through 12 in wing 2 constitute a distinct part. This option is approvable because it constitutes all beds in each wing. • All rooms numbered 1 through 12 in wing 5. This option is approvable because it includes all beds in the wing. • Room numbers 1 through 6 in wing 4 constitute a distinct part. This option is approvable because it includes all beds that constitute a single side of the corridor. • Room numbers 7 through 12 in wing 2 and all rooms 1 through 12 in wing 1 constitute a distinct part. This option is approvable because it includes all beds in wing 1 and all beds that constitute a single side of the corridor in wing 2. 3202A2 - Do Not Meet Distinct Part Certification (Rev. 1, 05-21-04) Neither of the examples discussed below, in the context of Illustration I, meet the requirements for distinct part certification. • Room numbers 1 through 12 in wing 1 and rooms 3, 4, and 5 in wing 6 do not constitute a distinct part. This option is not approvable because of the inclusion of the three rooms in wing 6. • Room number 2 in wing 1, room numbers 5 and 7 in wing 6, and room numbers 4, 5, 6, 10, 11, and 12 in wing 4. This option is not approvable because the distinct part area must be physically separate from (that is, not commingled with) the beds of the institution or institutional complex in which it is located. 3202B - Changes in Bed Size of Participating SNF and/or NF (Rev. 1, 05-21-04) When an institution or institutional complex not previously certified as or with a SNF and/or NF establishes a SNF and/or NF, it must be initially certified and periodically recertified. If an institution or institutional complex has an existing SNF and/or NF agreement, it may elect to change the number of beds that are certified to participate in the Medicare or Medicaid program up to two times per cost reporting year in accordance with the requirements set out below. Where a change in the size of a SNF also impacts the size of a NF, or vice versa, this represents one change for the SNF and one change for the NF. An institution or institutional complex that is participating in the Medicare program can find these same requirements in §2337 of the Provider Reimbursement Manual, Part I. An institution or institutional complex may only change the bed size of its SNF and/or its NF once on the first day of the beginning of its cost reporting year and again on the first day of a single cost reporting quarter within that same cost reporting year in order to effect one of the following combinations: • An increase in its bed size on the first day of the beginning of its cost reporting year and an increase in its bed size on the on the first day of a single cost reporting quarter that falls within the same cost reporting year; or • An increase in its bed size on the first day of the beginning of its cost reporting year and a decrease in its bed size on the first day of a single cost reporting quarter that falls within the same cost reporting year; or • A decrease in its bed size on the first day of the beginning of its cost reporting year and an increase in its bed size on the first day of a single cost reporting quarter that falls within the same cost reporting year. At no time can the RO or the SA approve two decreases in the bed size of an institution within the same cost-reporting year. The institution or institutional complex may submit only ONE change in bed size at a time. Furthermore, an institution cannot request a change in its bed size just because it undergoes a change of ownership (CHOW) or because it has been approved to change its cost reporting year. In either of these circumstances, it is still bound by the filing requirements found in subsection C. A request for a change in the number of certified beds cannot be approved on a retroactive basis. All changes are made on a prospective basis only in accordance with the effective date indicated above. The institution requesting a change in bed size must submit a written request to the RO or SA (as appropriate) in conformance with the requirements found in subsection C. An institution or institutional complex can not self- designate the effective date of a change in bed size. 3202C - General Request Filing Requirements (Rev. 1, 05-21-04) An institution or institutional complex seeking a change in the number of Medicare and/or Medicaid certified beds must: • Submit a written request to the RO or SA (as appropriate) for the change 45 calendar days before: o The first day of its cost reporting year to effect a change on the first day of its cost reporting year; or o The first day of a single cost reporting quarter within the same cost reporting year at which time it seeks to change its bed size to effect a change on the first day of the designated cost reporting quarter. • Submit floor plans identifying all areas of the institution or institutional complex with the current certified bed configuration and the proposed certified bed configuration in order for the RO or SA to determine that the proposed change is in fact, in conformance with the rules for full participation or distinct part certification, whichever applies. • Include a reference to the cost-reporting year of the institution or institutional complex. If there has been a change in the cost-reporting year originally selected by the institution or institutional complex at the time of its initial certification, submit a copy of the letter submitted to the fiscal intermediary and the fiscal intermediary’s response to the request. 3202D - Exceptions (Rev. 1, 05-21-04) There are certain situations (described below) that we believe warrant an exception to the above policy. Therefore, even if the institution or institutional complex has been approved for a change in bed size in accordance with the policies articulated above, the institution or institutional complex may be granted a change in bed size on the basis of one of these situations. To request a change in bed size based on one of these situations, the institution or institutional complex must file a written request with the RO or SA (as appropriate) 45 calendar days before the first day of its next cost reporting quarter, at which time the request will be effective if approved, along with floor plans identifying all areas of the institution or institutional complex with the current certified bed configuration and the proposed certified bed configuration. An exception may be granted based only on one of the following situations: 3202D1 - Life Safety Code (LSC) Requirements An exception may be granted if the request is to reduce the size of the SNF or NF to avoid being out of compliance with LSC requirements (e.g., sprinkler installation). The proposed bed configuration must be separated from the rest of the institution or institutional complex by a 2-hour firewall, so that there is no danger of the fire spreading there from other parts not meeting safety requirements. In this case, the proposed reduction in the size of the SNF or NF may be established with an effective date that is requested by the institution or institutional complex, but not earlier than the date that the separation can be documented. A full survey by the fire authority must be performed if the reason for the request is to limit noncompliance with LSC requirements. 3202D2 - Elimination of Distinct Part An exception may be granted if an institution or institutional complex concludes that it wants to become fully participating (i.e., all beds within the institution or institutional complex are certified to participate in the Medicare and/or Medicaid program). If the institution or institutional complex decides to become fully certified to participate in the Medicare and/or Medicaid program, it cannot return to distinct part certification until, at the earliest, the beginning of its next cost reporting year. 3202D3 - Enlargement through Construction, Purchase or Lease of Additional Space An exception may be granted if the institution or institutional complex requests to increase the size of its SNF or NF to include space acquired through new construction, purchase or lease (e.g., constructing a new wing, purchasing an adjacent building or leasing a floor in a hospital). 3202E - Change in Designated Bed Location(s) (Rev. 1, 05-21-04) An institution or institutional complex may request to change its designated bed locations, as long as there is no change in the number of beds certified to participate in the Medicare and/or Medicaid program, by submitting a written request to the SA or the RO 30 calendar days in advance of such a change. In addition, the institution or institutional complex must submit floor plans identifying all areas of the institution or institutional complex with the current certified bed configuration and the proposed certified bed configuration in order for the RO or SA to determine that the proposed change is in fact, in conformance with the rules for full certification or distinct part certification, whichever applies. The institution or institutional complex must adhere to the notification requirements found in 42 CFR 483.10(b)(11)(ii)(A) and the residents’ rights requirements found in 42 CFR 483.10(o). The RO or SA must approve the request before the institution or institutional complex makes the change. No changes are made on a retroactive basis. 3202F - RO or SA (as appropriate) Actions Upon Receipt of Written Request for Change in Bed Size/Location (Rev. 1, 05-21-04) The RO or the SA must take the following actions when reviewing a request for a change in bed size: • Date stamp the letter from the institution requesting a change in bed size with the date it was received by the RO or SA; • Verify the cost-reporting year selected by the institution or institutional complex using the OSCAR/ASPEN system. The cost-reporting year of the provider must match what is contained in OSCAR/ASPEN. If the reported cost reporting year is different than that found in OSCAR/ASPEN it would be as a consequence of a change in cost reporting year (for Medicare) which must be approved by the fiscal intermediary in accordance with the requirements found in 42 CFR 413.34(f). Absent such a change, the institution or institutional complex must adhere to the cost reporting year selected at its initial certification; • Document information as required under §2764; • Complete the Form CMS-1539 reflecting the change in bed size/designated bed location(s) if the request is approved; • Notify the institution or institutional complex in writing of the RO or SA decision to either approve or disapprove the request prior to the effective date of the change. If approved the letter must include the effective date of the change in bed size and/or designated bed locations, the total number of beds certified and the designated bed locations. If disapproved the letter must explain the requirement(s) not met; • Send a copy of the letter notifying the institution or institutional complex of the RO or SA decision to approve or disapprove the request to the appropriate fiscal intermediary; • Update the OSCAR/ASPEN system. Usually, advancing the scheduled SA standard survey to recertify the changed configuration is unnecessary. A telephone contact often resolves most questions, such as changing bylaws, staffing, or other issues regarding the capacity of the institution or institutional complex to furnish the level of care contemplated in the long term care requirements. The SA must advance the survey schedule and perform a survey if; • There is reason to question whether the institution remains in compliance with the long term care requirements (e.g., the proposed relocation site is unsuitable); • Information suggests that as a part of the change, a different governing body or managing personnel directs the distinct part. (See §3210.); or • The area within the physical plant to be certified has not been subjected to a life safety code survey. 3202G - Evaluation (Rev. 1, 05-21-04) The SA bases its evaluation of the proposed certified area upon the following guidelines. 3202G1 - Shared Facilities and Services Rarely is a distinct part SNF or NF so completely self-contained that it independently meets all of the long-term care requirements. Therefore, to the extent necessary, the SA evaluates services, facilities, and activities located outside the distinct part that are used by the distinct part’s residents. This evaluation is not an assessment of whether the distinct part meets the requirements to be considered provider-based for purposes of Medicare reimbursement. Often, the distinct part will share central supporting services such as dietary, housekeeping, and plant maintenance with the rest of the institution or institutional complex. Depending on the size and type of the institution or institutional complex, the distinct part may also have shared administration and supervisory, medical, and therapeutic services. The primary consideration in the evaluation of shared services is whether the sharing can be done without sacrificing the quality of care rendered to distinct part residents or endangering their health and safety. The distinct part must demonstrate a capacity to provide all of the services, facilities, and supervision required by the long term care requirements. For this reason, the SA may need to consider the total staff of an institution or institutional complex, particularly with respect to the amount of shared responsibilities. 3202G2 - Effect of Hospital Accreditation or Certification on SNF or NF Make no assumption regarding a distinct part SNF or NF’s compliance with long term care requirements on the basis of the institutional or institutional complex’s accreditation by the Joint Commission on Accreditation of Healthcare Organizations or AOA or the institution or institutional complex’s Medicare participation. Survey and evaluate the institution or institutional complex to determine its compliance with all of the long-term care requirements. 3202G3 - SNF or NF as Distinct Part of a Psychiatric Hospital The guidelines for the identification of a distinct part SNF or NF, regardless of the type of institution or institutional complex in which it is located, are generally applicable. However, there are special factors to consider when an institutional complex is certified to participate as a psychiatric hospital. A SNF or NF cannot be certified if it is primarily for the care and treatment of mental diseases. In the context of a psychiatric hospital, for example, the presumption is that in most cases a SNF or NF distinct part of such a hospital is designed primarily for the care and treatment of patients with mental diseases. A distinct part SNF or NF cannot be established unless the psychiatric hospital either has a separate medical-surgical unit that is participating as a distinct part general hospital or has an arrangement with a community hospital for transfer to the hospital and back to the distinct part for post-hospital convalescence when a beneficiary requires medical-surgical services. In determining whether a distinct part SNF or NF is primarily for the care and treatment of mental diseases, the SA must look at the primary purposes for the unit’s existence, in combination with the requirements discussed above. A psychiatric hospital can have such a unit or section certified as a distinct part SNF or NF, only if the primary purpose of the unit is to provide medical services and the hospital meets one of the requirements discussed in the last sentence of the preceding paragraph. In addition, a distinct part SNF or NF of a psychiatric hospital would also have to be licensed pursuant to the State or local law which provides for licensing of institutions of a type which qualify as SNFs, i.e., the distinct part would have to be licensed as a nursing home. 3202H - Survey Considerations (Rev. 1, 05-21-04) Although an immediate survey is not mandatory, the SA must complete Form CMS-1539 promptly to report the change in size and location of the SNF or NF. Furthermore, the SA completes a spell of illness certification for any components of the institution or institutional complex that are being removed from inclusion in the SNF or NF. (See §2164.) If, in order to process this certification, the SA finds that survey is necessary, it may perform a full standard survey.