Ch. 7, § 9. Cost Categories

(a) General requirements. Costs are allocated among the following categories: (1) healthcare; (2) capital; (3) exempt; and (4) operating. For purposes of this Chapter, labor costs include the cost of employee benefits and taxes. Supplies used in providing patient-related services include, but are not limited to, those specified in Attachment A. (b) Healthcare costs. Healthcare costs consist of direct costs of patient-related services rendered within a nursing facility. Healthcare costs are subject to a quarterly case mix acuity adjustment. Healthcare costs include, but are not limited to: (i) Entering and maintaining medical records; (ii) Providing social services; (iii) Providing direct nursing healthcare by: (A) Registered nurses; (B) Licensed practical nurses; (C) Nurse assistants and certified nurse assistants (CNA); and (D) Contract nurses. (iv) Payroll taxes and employee benefits associated with the wages above. (c) Capital costs. Capital costs include, but are not limited to: (i) Leasehold amortization; (ii) Rent and lease of real property; (iii) Depreciation; and (iv) Interest on loans for real property and personal property. (d) Exempt costs. Exempt costs include, but are not limited to: (i) Property taxes. Tax penalties, late fees, and income taxes are not allowable. (ii) Property insurance. Malpractice, workmen's compensation, and other employee- related insurances are not considered property insurance and are not exempt. (iii) Fees for CNA classes, texts, and exams. (e) Operating costs. Operating costs include, but are not limited to: (i) Administrative and general costs including: (A) Home office; and (B) Management fees. (ii) Physical facility operations; (iii) Laundry; (iv) Housekeeping; (v) Cafeteria; (vi) Dietary; (vii) Nurse administration; (viii) Central services, routine supplies, and non legend drugs; (ix) Pharmacy consultant; (x) Activities; (xi) Payroll taxes and employee benefits associated with the wages above; (xii) Medical director; and (xiii) Other costs permitted by federal and state rules and regulations not mentioned in (b), (c), and (d) in this section.