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April 4, 2005
 
 
MEDICAID INFORMATION RELEASE MA05-12
 
TO:                         Nursing Facilities
 
FROM:  Leslie M. Clement, Acting Deputy Administrator
 
SUBJECT:            EVALUATING NURSING FACILITY‚ÄôS LOWER OF COSTS OR CHARGES LIMITATION
 
The Department was asked by the Nursing Facilities PPS Oversight Committee to explain in further detail how nursing facilities can better manage the lower of cost or charges limitation in all quarters of the fiscal year.  The following Information Release clarifies the calculation.
         
Each year, reimbursement rates are rebased effective July 1st.  This calculation of lower of costs or charges remains in effect for the entire rate period from July 1 through June 30.  If a revision is made to your private pay rate during the rate period, please contact Myers and Stauffer at 208-378-1400 in order for them to consider your requested change in the following rate quarter. 
 
To avoid the lower of costs or charge limitation, you would benefit from projecting the July 1 rate based on the cost report used to calculate the current rate and the highest (most conservative) acuity level anticipated.  If you find that your customary charge is lower or close to this projected July 1st rate, you may want to consider increasing your customary charge to avoid the lower of cost or charge limitation for the entire rate period.
 
If you have any questions concerning the information contained in this release, please contact Sheila Pugatch, Senior Financial Specialist for the Bureau of Medicaid Policy, at (208) 364-1817.
 
Thank you for your continued participation in the Idaho Medicaid Program.
 
LC/sp/kl