HAR §17-1739.2-17. Rebasing the basic PPS rates

The department shall perform a rebasing following the methodology but using updated cost report data as described in section 17-1739.2-7 so that a provider shall not have its basic PPS rates calculated by reference to the same base year for more than eight state fiscal years. [Eff 09/01/03 ] (Auth: HRS §346-59; 42 U.S.C. §1396a) (Imp: 42 C.F.R. §447.252) §17-1739.2-18 Adjustments to the basic PPS rates. (a) Each proprietary provider is eligible to receive the ROE adjustment. The ROE adjustment shall UNOFFICIAL 1739.2-27 be calculated by identifying the appropriate amounts from the base year cost report or other sources, and dividing those amounts by the provider's base year patient days to obtain a base year ROE per diem. The base year ROE adjustments shall receive the same increase to reflect inflation as all other base year costs. (b) All proprietary providers shall receive the GET adjustment. The GET adjustment shall be paid by increasing the basic PPS rates plus all applicable adjustments by 1.04167. (c) Nursing facilities who qualify shall receive the capital incentive adjustment, the G&A incentive adjustment, or both. Due to the limited number of ICF/MRs, those facilities shall not be eligible to receive either the Capital Incentive or G&A incentive adjustments. (d) Beginning with PPS rate year July 1, 1995 to June 30, 1996, qualifying NFs shall receive the G&A small facility adjustment. (e) All facilities will have a per diem dental allowance add-on added to the basic PPS rate. This amount will be the same for all facilities, based on historical paid dental claims data, as determined by the department. (f) Total PPS rates - A provider's basic PPS rates shall equal the sum of its direct nursing, G&A and capital per diem components for each acuity level as calculated under this chapter. A new provider's basic PPS rate shall be the per diem rate calculated under section 17-1739.2-10. The basic PPS rate for a provider with new beds shall be the per diem rate calculated under section 17-1739.2-11. (g) A provider's adjusted PPS rate shall be the product of the following formula: Basic PPS Rate + Capital Incentive Adjustment (if applicable) + G&A Incentive Adjustment (if applicable) + ROE Adjustment (if applicable) + G&A Small Facility Adjustment (if applicable) Subtotal x GET Adjustment (if applicable)) = Adjusted PPS Rate UNOFFICIAL 1739.2-28 (h) A provider's total PPS rate shall be the adjusted PPS rate. [Eff 09/01/03; am 05/05/05] (Auth: HRS §346-59; 42 U.S.C. §1396a (13) (Imp: 42 C.F.R. §447.252) §17-1739.2-19 Administrative review - rate reconsideration. (a) Providers shall have the right to request a rate reconsideration for the following conditions: (1) A change in ownership, leaseholder, or operator, without a change in licensure and certification, which shall be grounds for rate reconsideration only to the extent authorized in section 17-1739.2-3(f); (2) Providers who receive no rate increase or a reduced rate due to implementation of the acuity based reimbursement system will not be able to file for a rate reconsideration under this section for adjustments or damages. (3) Extraordinary circumstances including, but not limited to, the following: acts of God; changes in life and safety code requirements; changes in licensure law, rules, or regulation; significant changes in patient mix or nature of service occurring subsequent to the base year; errors by the department in data extraction or calculation of the per diem rates; subject to section 17-1739.2-16, inaccuracies or errors in the base year cost report; or additional capital costs resulting from renovation of a facility that does not result in additional beds but otherwise are attributable to extraordinary circumstances. Mere inflation of costs, absent extraordinary circumstances, shall not be a basis for rate reconsideration; (4) To determine in advance the amount of rate reconsideration relief, if any, that will be granted to the provider for an anticipated future cost in excess of $50,000, or $1,000 UNOFFICIAL 1739.2-29 per bed, whichever is less. The provider must be otherwise ready to incur the cost, and it must be attributable to a proposed capital expenditure, change in service or licensure or extraordinary circumstance. Any determination by the department is subject to the provider actually incurring the anticipated cost. If the actual cost is greater or lesser than the anticipated future cost submitted by the provider, then the department may adjust its rate reconsideration relief determination either on its own initiative or by supplemental request of the provider. A provider that fails to request an advance rate reconsideration from the department assumes the risk that no rate reconsideration relief may ultimately be available; and (5) If the department reduces the grandfathered capital component of a new provider or a provider with new beds due to an inaccurate or unreasonable projection of capital costs by the provider. (b) Requests for reconsideration shall be submitted in writing to the department and shall set forth the reasons for the requests. Each request shall be accompanied by sufficient documentation to enable the department to act upon the request. Documentation shall include the data necessary to demonstrate that the circumstances for which reconsideration is requested meet one or more of the conditions specified in subsection (a). The requests shall include the following: (1) A presentation of data to demonstrate the reasons for the provider's request for rate reconsideration; (2) If the reconsideration request is based on changes in patient mix, the provider must document the change using well-established case-mix measures, accompanied by a showing of cost impact; and (3) A demonstration that the provider's costs UNOFFICIAL 1739.2-30 exceed the payments under this chapter. (c) Except as otherwise provided in this chapter, a request for reconsideration shall be submitted within sixty days after the annual PPS rate is provided to the provider by the department, or at other times throughout the year if the department determines that extraordinary circumstances occurred or if the circumstances defined in subsection (a)(1) occur. (d) Pending the department's decision on a request for rate reconsideration, the provider shall be paid the PPS rate initially determined by the department. If the reconsideration request is granted, the resulting new PPS rate shall be effective no earlier than the first day of the PPS rate year. (e) A provider may appeal the department's decision on the rate reconsideration request. The appeal shall be filed in accordance with the procedural requirements of chapter 17-1736, subchapter 3, of the Hawaii Administrative Rules. (f) Except as noted below, rate increases granted pursuant to the rate reconsideration process shall not exceed an amount equal to the sum of the component ceilings for a particular provider's classification minus the provider's basic PPS rate: (1) If a provider is either new or has added new beds and its basic PPS rate is calculated under sections 17-1739.2-10, 17-1739.2-11, or 17-1739.2-12, then a rate increase shall not exceed the difference between the sum of the ceilings for the direct nursing and general and administrative components and the sum of the provider's facility-specific components for those categories; (2) If a provider is receiving the grandfathered capital component, then the increase shall not exceed the difference between the sum of the direct nursing and G&A component ceilings and sum of the provider's direct nursing and G&A components; (3) For providers that qualify for the G&A small facility adjustment, the sum of the UNOFFICIAL 1739.2-31 component ceiling is to reflect the increase to the G&A component ceiling as defined in section 17-1739.2-1. (g) Rate reconsideration granted under this section shall be effective for the remainder of the PPS rate year. If the provider believes its experience justifies continuation of the reconsidered rate in subsequent fiscal years, then it shall submit information to update the documentation specified in subsection (b) within sixty days after receiving notice of the provider's rate for each subsequent PPS rate year. The department shall review the documentation and notify the provider of its determination as described in subsection (d). The department may, at its discretion, grant a rate adjustment that will be incorporated into the provider's rate for one or more of the following PPS rate years. (h) The decision to grant a rate reconsideration request is subject to the department's discretion. In exercising that discretion, the department may consider that a provider's adjusted PPS rate includes a grandfathered component or incentive adjustment. [Eff 09/01/03 ] (Auth: HRS §346-59; 42 U.S.C. §1396a) (Imp: 42 C.F.R. §447.252)