Sec.17-313b-13. Phase-in of client-based service rate system

Three separate rate setting systems shall exist to establish service rates for the contract year July 1, 1987 through June 30, 1988. For succeeding contract years, all existing community living arrangements shall have client-based service rates established in accordance with Sec. 17-313b-8 of these regulations. After June 30, 1988, all newly licensed community living arrangements will have an initial rate established in accordance with Sec. 17-313b-10 of these regulations.

(1) All organizations shall file an unaudited consolidated operational report on or before the date established by emergency regulation for the period July 1, 1985 through June 30, 1986. For any organization which failed to comply with the provisions of Section 17-313b-2 of the emergency regulations, effective July 9, 1987, the commissioner may authorize rates comparable to the lowest rate paid to a community living arrangement for the same level of care.

(2) Pilot organizations, selected on a voluntary basis from a region designated by the Commissioner of Mental Retardation, shall file operational plans on or before dates agreed upon by such organizations and the Department of Mental Retardation, for the contract year July 1, 1987 through June 30, 1988.

(i) Room and board reimbursement rates shall be established for the community living arrangements operated by the pilot organizations, in accordance with Sec. 17-313b-5 or Sec. 17-313b-6 of these regulations, whichever is applicable for the contract year July 1, 1987 through June 30, 1988.

(ii) Client-based service rates shall be negotiated and established for the community living arrangements operated by the pilot organizations in accordance with Sec. 17-313b-8 of these regulations, for the contract year July 1, 1987 through June 30, 1988, and shall supercede any previously established rates for the pilot organizations.

(3) Existing community living arrangements operated by non-pilot organizations shall have rates established for the contract year July 1, 1987 through June 30, 1988 based upon the unaudited consolidated operational report.

(i) Room and board reimbursement rates shall be established for the community living arrangements operated by the non-pilot organizations, in accordance with Sec. 17-313b-5 or Sec. 17-313b-6 of these regulations, whichever is applicable.

(ii) Per diem service reimbursement rates for community living arrangements licensed for four or more beds, excluding beds designated for staff and/or respite care, shall be calculated based upon:

(a) An amount for direct care staff, administrative and clerical staff and/or services, transportation of residents and staff, and such other expenses necessary to maintain the licensure of the facility in accordance with the regulations of the Department of Mental Retardation, adjusted by the Gross National Product (GNP) deflator percentage increase or decrease for the eighteen month time lag from the cost year to the rate year; plus

(b) A cost efficiency adjustment of 25% of the difference between the allowable cost per resident day in the cost year and the service rate promulgated pursuant to subsection (3) (iii) infra of these regulations for the group home's licensed level of care for the rate year ending June 30 following the close of the cost year. In no event shall such cost efficiency adjustment be made if the allowable cost per resident day as defined in these regulations in the cost year exceeds 90% of the amount for the applicable level of care in subsection (3) (iii) infra; plus

(c) Computation of a per diem reimbursement rate based upon the total costs as adjusted by the procedures referred to above divided by the minimum allowable resident days for the applicable cost year.

A resident day is the unit of measurement for lodging provided and services rendered to one inpatient between the census-taking hour on two successive days. In computing resident days, the day of admission shall be counted but the day of discharge shall not. In computing resident days, reserve bed days for which payment is received shall be counted.

For purposes of computing minimum allowable resident days, utilization of a facility's licensed beds shall be determined at a minimum of 90% of capacity (excluding beds designated for respite care), except for new facilities and facilities which are licensed for additional beds which may be permitted a lower occupancy rate for the first three months of operation after the effective day of licensure. Minimum allowable resident days for beds designated for respite care shall be determined at a minimum of 50% of capacity.

(iii) Per diem service rates for existing community living arrangements, licensed for three or fewer beds, excluding beds designated for staff and/or respite care, operated by non-pilot organizations shall be a flat rate based on the aggregate level of care provided in the community living arrangement as indicated in the license issued by the Department of Mental Retardation. Such rates shall also be the maximum amount paid per day for all community living arrangements at each level of care.

The per diem rates for the level of care as determined by the Department of Mental Retardation at the time of licensure, for the contract year ending June 30, 1988 are as follows:

Licensed Level Of Care	Amount Per Resident Per Day
1	$ 19.93
2	$ 42.67
3	$ 54.35
4	$ 68.59
5	$ 89.83

The Commissioner of Income Maintenance may, upon the written request of the Commissioner of Mental Retardation, grant an exemption from the per diem service rate for the level of care 5 if the Commissioner of Mental Retardation determines that the per diem service rate would jeopardize an appropriate placement. The per diem service rate established in excess of level of care 5 shall be programmatically and fiscally justified by the Commissioner of Mental Retardation.

If a community living arrangement is licensed to serve clients at more than one disability level, a weighted average amount payable to such community living arrangement shall be computed as follows. The Department of Mental Retardation shall designate the number of beds licensed at each level of care in the community living arrangement. The rate for a community living arrangement shall be determined by summing for each level of care within the community living arrangement the product of the number of beds at each level times the amount specified in this subsection for each level, or the amount granted in an exemption pursuant to this section, updated to the current contract year, and dividing said sum by the total number of licensed beds in the community living arrangement. The commissioner, with the approval of the Commissioner of Mental Retardation, may grant an exemption from the limitations of this section, if such exemption is necessary to accommodate residential direct service staff compensation adjustments approved by the Commissioner of the Department of Mental Retardation. Any such exemptions shall be programmatically and fiscally justified by the Commissioner of the Department of Mental Retardation.

A community living arrangement which does not achieve 90 percent occupancy in the first 90 days of operation may petition the Commissioner for a service rate which exceeds the amount specified in this subsection based on the hardship which such limitation would otherwise cause. Such petition must set forth the pertinent factors relating to such hardship, including such detailed cost data as may be required to document the facts of the case and the reasons for the failure to attain the aforementioned occupancy level. Based on the consideration of the foregoing and any other factors as the commissioner deems pertinent, the commissioner, with the approval of the Commissioner of the Department of Mental Retardation, may grant an exemption of not more than ninety days from the limitations of this section.

(4) New community living arrangements operated by non-pilot organizations which receive initial funding through state fiscal year 1987–1988 appropriations, shall have rates established in accordance with the following:

(i) Room and board reimbursement rates shall be established for new community living arrangements which receive initial funding through state fiscal year 1987–1988 appropriations, operated by non-pilot organizations, in accordance with Sec. 17-313b-5 or Sec. 17-313b-6 of these regulations, whichever is applicable.

(ii) Service rates for these community living arrangements shall be established in accordance with the following modified level of care system. The per diem service rates for the modified level of care as determined by the Department of Mental Retardation at the time of licensure for the contract year ending June 30, 1988, are as follows:

Licensed Level of Care (Level of Supervision)	Amount Per Resident Day
1 and 2 (assisted) 3 and 4	$42.67
(moderate supervised)5	$68.59
(ongoing comprehensive)	$89.83

The Commissioner of Income Maintenance may, upon the written request of the Commissioner of Mental Retardation, grant an exemption from the per diem service rate for the level of care 5 if the Commissioner of Mental Retardation determines that the per diem service rate would jeopardize an appropriate placement. The per diem service rate established in excess of level of care 5 shall be programmatically and fiscally justified by the Commissioner of Mental Retardation.

If a community living arrangement is licensed to serve clients at more than one disability level, a weighted average amount payable to such community living arrangement shall be computed as follows. The Department of Mental Retardation shall designate the number of beds licensed at each level of care in the community living arrangement. The rate for a community living arrangement shall be determined by summing for each level of care within the community living arrangement the product of the number of beds at each level times the amount specified in this subsection for each level, or the amount granted in an exemption pursuant to this section, updated to the current contract year, and dividing said sum by the total number of licensed beds in the community living arrangement. The Commissioner, with the approval of the Commissioner of Mental Retardation, may grant an exemption from the limitations of this section, if such exemption is necessary to accommodate residential direct service staff compensation adjustments approved by the Commissioner of the Department of Mental Retardation. Any such exemptions shall be programmatically and fiscally justified by the Commissioner of the Department of Mental Retardation.

A community living arrangement which does not achieve 90 percent occupancy in the first 90 days of operation may petition the commissioner for a service rate which exceeds the amount specified in this subsection based on the hardship which such limitation would otherwise cause. Such petition must set forth in pertinent factors relating to such hardship, including such detailed cost data as may be required to document the facts of the case and the reasons for the failure to attain the aforementioned occupancy level. Based on the consideration of the foregoing and any other factors as the commissioner deems pertinent, the commissioner, with the approval of the Commissioner of the Department of Mental Retardation, may grant an exemption of not more than ninety days from the limitations of this section.

(5) Rates will only be established in accordance with this section for the contract year July 1, 1987 through June 30, 1988. Thereafter, rates shall be established in accordance with the remaining sections of these regulations.

(Effective June 24, 1988)