HB 5305 2023
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F L O R I D A H O U S E O F R E P R E S E N T A T I V E S
A bill to be entitled 1
An act relating to Medicaid reimbursement for nursing 2
home care; amending s. 409.908, F.S.; revising a 3
parameter to implement a prospective payment 4
methodology for Medicaid reimbursement rate settings 5
for nursing home care; providing an effective date. 6
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Be It Enacted by the Legislature of the State of Florida: 8
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Section 1. Paragraph (b) of subsection (2) of section 10
409.908, Florida Statutes, is amended to read: 11
409.908 Reimbursement of Medicaid providers. —Subject to 12
specific appropriations, the agency shall reimburse Medicaid 13
providers, in accordance with state and federal law, according 14
to methodologies set forth in the rules of the agency and in 15
policy manuals and handbooks incorporated by reference therein. 16
These methodologies may include fee schedules, reimbursement 17
methods based on cost reporting, negotiated fees, competitive 18
bidding pursuant to s. 287.057, and other mechanisms the agency 19
considers efficient and effective for purchasing services or 20
goods on behalf of recipients. If a provider is reimbursed based 21
on cost reporting and submits a cost report late and that cost 22
report would have been used to set a lower reimbursement rate 23
for a rate semester, then the provider's rate for that semester 24
shall be retroactively calculated using the new cost report, and 25
HB 5305 2023
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F L O R I D A H O U S E O F R E P R E S E N T A T I V E S
full payment at the recalculated rate shall be effected 26
retroactively. Medicare -granted extensions for filing cost 27
reports, if applicable, shall also apply to Medicaid cost 28
reports. Payment for Medicaid compensable services made on 29
behalf of Medicaid-eligible persons is subject to the 30
availability of moneys and any limitations or directions 31
provided for in the General Appropriations Act or chapter 216. 32
Further, nothing in this section shall be construed to prevent 33
or limit the agency from adjusting fees, reimbursement rates, 34
lengths of stay, number of visits, or number of services, or 35
making any other adjustments necessary to comply with the 36
availability of moneys and any limitations or directions 37
provided for in the General Appropriations Act, provided the 38
adjustment is consistent with legislative intent. 39
(2) 40
(b) Subject to any limitations or directions in the 41
General Appropriations Act, the age ncy shall establish and 42
implement a state Title XIX Long -Term Care Reimbursement Plan 43
for nursing home care in order to provide care and services in 44
conformance with the applicable state and federal laws, rules, 45
regulations, and quality and safety standard s and to ensure that 46
individuals eligible for medical assistance have reasonable 47
geographic access to such care. 48
1. The agency shall amend the long -term care reimbursement 49
plan and cost reporting system to create direct care and 50
HB 5305 2023
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F L O R I D A H O U S E O F R E P R E S E N T A T I V E S
indirect care subcomponen ts of the patient care component of the 51
per diem rate. These two subcomponents together shall equal the 52
patient care component of the per diem rate. Separate prices 53
shall be calculated for each patient care subcomponent, 54
initially based on the September 20 16 rate setting cost reports 55
and subsequently based on the most recently audited cost report 56
used during a rebasing year. The direct care subcomponent of the 57
per diem rate for any providers still being reimbursed on a cost 58
basis shall be limited by the cos t-based class ceiling, and the 59
indirect care subcomponent may be limited by the lower of the 60
cost-based class ceiling, the target rate class ceiling, or the 61
individual provider target. The ceilings and targets apply only 62
to providers being reimbursed on a cost-based system. Effective 63
October 1, 2018, a prospective payment methodology shall be 64
implemented for rate setting purposes with the following 65
parameters: 66
a. Peer Groups, including: 67
(I) North-SMMC Regions 1-9, less Palm Beach and Okeechobee 68
Counties; and 69
(II) South-SMMC Regions 10-11, plus Palm Beach and 70
Okeechobee Counties. 71
b. Percentage of Median Costs based on the cost reports 72
used for September 2016 rate setting: 73
(I) Direct Care Costs ........................ 100 percent. 74
(II) Indirect Care Costs ...................... 92 percent. 75
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F L O R I D A H O U S E O F R E P R E S E N T A T I V E S
(III) Operating Costs ......................... 86 percent. 76
c. Floors: 77
(I) Direct Care Component ..................... 95 percent. 78
(II) Indirect Care Component ................ 92.5 percent. 79
(III) Operating Component ........................... None. 80
d. Pass-through Payments .................. Real Estate and 81
Personal Property 82
Taxes and Property Insurance. 83
e. Quality Incentive Program Payment 84
Pool 9 6 percent of September 85
2016 non-property related 86
payments of included facilities. 87
f. Quality Score Threshold to Quality for Quality 88
Incentive 89
Payment ................. 20th percentile of included facilities. 90
g. Fair Rental Value System Payment Parameters: 91
(I) Building Value per Square Foot based on 2018 RS Means. 92
(II) Land Valuation .... 10 percent of Gross Building value. 93
(III) Facility Square Footage ...... Actual Square Footage. 94
(IV) Moveable Equipment Allowance ......... $8,000 per bed. 95
(V) Obsolescence Factor ...................... 1.5 percent. 96
(VI) Fair Rental Rate of Return ................ 8 percent. 97
(VII) Minimum Occupancy ....................... 90 percent. 98
(VIII) Maximum Facility Age ..................... 40 years. 99
(IX) Minimum Square Footage per Bed ................... 350. 100
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(X) Maximum Square Footage for Bed .................... 500. 101
(XI) Minimum Cost of a renovation/replacements $500 per bed. 102
h. Ventilator Supplemental payment of $200 per Medicaid 103
day of 40,000 ventilator Medicaid days per fiscal year. 104
2. The direct care subcomponent shall include salaries and 105
benefits of direct car e staff providing nursing services 106
including registered nurses, licensed practical nurses, and 107
certified nursing assistants who deliver care directly to 108
residents in the nursing home facility, allowable therapy costs, 109
and dietary costs. This excludes nursi ng administration, staff 110
development, the staffing coordinator, and the administrative 111
portion of the minimum data set and care plan coordinators. The 112
direct care subcomponent also includes medically necessary 113
dental care, vision care, hearing care, and po diatric care. 114
3. All other patient care costs shall be included in the 115
indirect care cost subcomponent of the patient care per diem 116
rate, including complex medical equipment, medical supplies, and 117
other allowable ancillary costs. Costs may not be allocat ed 118
directly or indirectly to the direct care subcomponent from a 119
home office or management company. 120
4. On July 1 of each year, the agency shall report to the 121
Legislature direct and indirect care costs, including average 122
direct and indirect care costs per resident per facility and 123
direct care and indirect care salaries and benefits per category 124
of staff member per facility. 125
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F L O R I D A H O U S E O F R E P R E S E N T A T I V E S
5. Every fourth year, the agency shall rebase nursing home 126
prospective payment rates to reflect changes in cost based on 127
the most recently audited cost report for each participating 128
provider. 129
6. A direct care supplemental payment may be made to 130
providers whose direct care hours per patient day are above the 131
80th percentile and who provide Medicaid services to a larger 132
percentage of Medicaid patients than the state average. 133
7. For the period beginning on October 1, 2018, and ending 134
on September 30, 2021, the agency shall reimburse providers the 135
greater of their September 2016 cost -based rate or their 136
prospective payment rate. Effecti ve October 1, 2021, the agency 137
shall reimburse providers the greater of 95 percent of their 138
cost-based rate or their rebased prospective payment rate, using 139
the most recently audited cost report for each facility. This 140
subparagraph shall expire September 3 0, 2023. 141
8. Pediatric, Florida Department of Veterans Affairs, and 142
government-owned facilities are exempt from the pricing model 143
established in this subsection and shall remain on a cost -based 144
prospective payment system. Effective October 1, 2018, the 145
agency shall set rates for all facilities remaining on a cost -146
based prospective payment system using each facility's most 147
recently audited cost report, eliminating retroactive 148
settlements. 149
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F L O R I D A H O U S E O F R E P R E S E N T A T I V E S
It is the intent of the Legislature that the reimbursement plan 151
achieve the goal of providing access to health care for nursing 152
home residents who require large amounts of care while 153
encouraging diversion services as an alternative to nursing home 154
care for residents who can be served within the community. The 155
agency shall base the establishment of any maximum rate of 156
payment, whether overall or component, on the available moneys 157
as provided for in the General Appropriations Act. The agency 158
may base the maximum rate of payment on the results of 159
scientifically valid analy sis and conclusions derived from 160
objective statistical data pertinent to the particular maximum 161
rate of payment. The agency shall base the rates of payments in 162
accordance with the minimum wage requirements as provided in the 163
General Appropriations Act. 164
Section 2. This act shall take effect October 1, 2023. 165