§ 2801-E — Voluntary residential health care facility rightsizing demonstration program

§ 2801-e. Voluntary residential health care facility rightsizing\ndemonstration program. 1. The voluntary residential health care facility\nrightsizing demonstration program is intended to be a flexible and\ninnovative approach to dealing with excess capacity in residential\nhealth care facilities due to changes in care delivery and other\nfactors. The demonstration is designed to promote the development of\nless restrictive and less institutional long-term care programs and\nservices; discourage inappropriate nursing home placements; generate\nmedicaid savings to the state and localities; and assist residential\nhealth care facilities with the financial implications of declining\noccupancies.\n 2. Notwithstanding any inconsistent provision of law or regulation to\nthe contrary, a residential health care facility, as defined in section\ntwenty-eight hundred one of this article, may apply to temporarily\ndecertify or permanently convert a portion of its existing certified\nbeds to another type of program or service under the voluntary\nresidential health care facility rightsizing demonstration program. The\ncommissioner may approve temporary decertifications and permanent\nconversions of beds totaling no more than five thousand residential\nhealth care facility beds on a statewide basis under this program. Such\napprovals shall reflect, to the extent practicable, participation by a\nvariety of residential health care facilities based on geography, size\nand other pertinent factors.\n 3. For this purpose, a residential health care facility may submit, in\na format and within timeframes specified by the commissioner, an\napplication to temporarily decertify beds, or to permanently convert\nbeds under this demonstration. Each such application shall include an\nestimate of the cost savings to the Medicaid program that would result\nfrom the proposal within the applicant facility. The commissioner shall\nbegin soliciting applications within one hundred eighty days of the\neffective date of this section, provided however that multiple\nsolicitations for proposals may be issued. In considering such\napplications, the commissioner shall take into account:\n (a) the potential for improved quality of care and quality of life for\nconsumers;\n (b) the likelihood that the proposal would result in cost savings to\nthe Medicaid program;\n (c) residential health care facility capacity and estimated public\nneed in the planning area in which the applicant is located;\n (d) the availability of less restrictive and less institutional\nlong-term care programs and services, as defined in this section, in the\nplanning area; and\n (e) the potential for improving the financial viability of the\napplicant facility or facilities.\n 4. Any reductions in the number of operational residential health care\nfacility beds resulting from this demonstration shall not be considered\nto create additional public need for residential health care facility\nbeds under this article.\n 5. (a) Subject to the approval of the commissioner and the director of\nthe budget, a residential health care facility may temporarily decertify\nbeds for up to five years. Such beds will remain on the facility's\nlicense during and after the five-year period. Temporarily decertified\nbeds may, with the prior approval of the commissioner and the director\nof the budget be reactivated in whole or in part at any time on or after\none year after the effective date of temporary decertification by the\nfacility and may be reactivated with the prior approval of the\ncommissioner and the director of the budget after the five-year period\nhas ended. A residential health care facility that reactivates\ntemporarily decertified beds may not temporarily decertify such beds\nagain during the demonstration. The commissioner may require the\nimmediate reactivation of such beds if necessary to respond to emergency\nsituations and/or facility closures. In the event the commissioner\nrequires such reactivation, the prohibition on temporarily decertifying\nbeds after a reactivation of beds shall not apply.\n (b) Notwithstanding any inconsistent provision of law or regulation to\nthe contrary, for purposes of determining medical assistance payments by\ngovernment agencies for residential health care facility services\nprovided pursuant to title eleven of article five of the social services\nlaw for facilities that have temporarily decertified beds:\n (i) the facility's capital cost reimbursement shall be adjusted to\nappropriately take into account the new bed capacity of the facility;\n (ii) the facility's peer group assignment for indirect cost\nreimbursement shall be based on its total certified beds less the number\nof beds that have been temporarily decertified; and\n (iii) the facility's vacancy rate shall be calculated on the basis of\nits total certified beds less the number of beds that have been\ntemporarily decertified for purposes of determining eligibility for\npayments for reserved bed days for residents of residential health care\nfacilities, provided, however, that such payments for reserved bed days\nfor facilities that have temporarily decertified beds shall be in an\namount that is fifty percent of the otherwise applicable payment amount\nfor such beds.\n 6. (a) Subject to the approval of the commissioner, a residential\nhealth care facility may permanently convert beds to less restrictive\nand less institutional long-term care beds, units or slots, including,\nbut not limited to, assisted living program, adult care facility, adult\nday health care, long-term home health care program and managed\nlong-term care demonstration beds, units or slots. For this purpose,\nresidential health care facility beds may be converted to beds, units or\nslots in the selected program or service on a one-to-one or other ratio\nor basis. A residential health care facility that permanently converts\nbeds under this subdivision relinquishes its license for the converted\nbeds.\n (b) If the facility seeks to permanently convert beds and neither the\nfacility nor its sponsoring organization is licensed to provide the\nprogram or service, it must obtain the written approval of the public\nhealth council, if required, pursuant to section twenty-eight hundred\none-a of this article or article thirty-six of this chapter to initiate\nthe new program or service.\n (c) The commissioner may, as necessary, waive existing methodologies\nfor determining public need under this article, article thirty-six of\nthis chapter and article seven of the social services law, as well as\nenrollment limitations under section forty-four hundred three-f of this\nchapter, to accommodate permanent conversions of beds to other programs\nor services on the basis that any such increases in capacity are linked\nto commensurate reductions in the number of residential health care\nfacility beds.\n (d) For purposes of adjusting the capital component of residential\nhealth care facility rates of payment determined pursuant to this\narticle for facilities that have permanently converted beds, the\ncommissioner shall appropriately take into account the new bed capacity\nof the facility.\n 7. No later than January first, two thousand seven, the commissioner\nshall provide the governor, the majority leader of the senate and the\nspeaker of the assembly with a written evaluation of the program. Such\nevaluation shall address the overall effectiveness of the program in\nreducing costs, encouraging placements in appropriate long-term care\nsettings and enhancing the availability of less restrictive and less\ninstitutional long-term care programs and services, and contain\nrecommendations relative to extending and/or expanding the program.\n