S T A T E   O F   N E W   Y O R K
       ________________________________________________________________________
                                         5739
                              2015-2016 Regular Sessions
                                   I N  S E N A T E
                                     June 1, 2015
                                      ___________
       Introduced  by  Sen.  KLEIN  -- read twice and ordered printed, and when
         printed to be committed to the Committee on Health
       AN ACT to amend the public health law, in relation to rates  of  payment
         to residential health care facilities based on the historical costs to
         the owner
         THE  PEOPLE OF THE STATE OF NEW YORK, REPRESENTED IN SENATE AND ASSEM-
       BLY, DO ENACT AS FOLLOWS:
    1    Section 1. Paragraph (d) of subdivision 2-a of  section  2808  of  the
    2  public  health  law, as amended by section 52 of part B of chapter 57 of
    3  the laws of 2015, is amended to read as follows:
    4    (d) For facilities granted operating certificates on  or  after  March
    5  tenth, nineteen hundred seventy-five, recognition of real property costs
    6  in such regulations shall be based upon historical costs to the owner of
    7  the facility, provided that payment for real property costs shall not be
    8  in  excess of the actual debt service, including principal and interest,
    9  and payment with respect to owner's equity, and further  provided  that,
   10  subject  to federal financial participation, and subject to the approval
   11  of the commissioner, effective April first, two  thousand  fifteen,  the
   12  commissioner  may  modify  such  payments  for  real  property costs for
   13  purposes of effectuating a shared savings  program,  whereby  facilities
   14  share  a  minimum of fifty percent of savings, for facilities that elect
   15  to refinance their mortgage loans. For  purposes  of  this  subdivision,
   16  owner's equity shall be calculated without regard to any surplus created
   17  by  revaluation  of  assets and shall not include amounts resulting from
   18  mortgage amortization where the payment therefor has  been  provided  by
   19  real  property  cost  reimbursement;  PROVIDED, HOWEVER, AS USED IN THIS
   20  SUBDIVISION THE TERMS "HISTORICAL  COSTS"  AND  "OWNER'S  EQUITY"  SHALL
   21  INCLUDE  THE  FULL REVALUATION OF THE ASSETS OF A FACILITY PURCHASED AND
   22  TRANSFERRED IMMEDIATELY FOLLOWING THE OPERATION OF SUCH FACILITY UNDER A
   23  COURT-ORDERED RECEIVERSHIP, BUT ONLY IF:
        EXPLANATION--Matter in ITALICS (underscored) is new; matter in brackets
                             [ ] is old law to be omitted.
                                                                  LBD11453-01-5
       S. 5739                             2
    1    (I) THE FACILITY HAS BEEN CONTINUOUSLY OPERATED AND OCCUPIED PRIMARILY
    2  WITH PERSONS WHO ARE IN RECEIPT OF MEDICAL ASSISTANCE BENEFITS FROM  THE
    3  TIME THAT THE RECEIVERSHIP WAS ESTABLISHED UNTIL THE TIME OF PURCHASE OR
    4  TRANSFER;
    5    (II)  THE PUBLIC HEALTH AND HEALTH PLANNING COUNCIL HAS CONSIDERED THE
    6  APPLICATION FOR TRANSFER OF THE FACILITY AND APPROVED THE APPLICATION AS
    7  AN ADDITION OF NET NEW BEDS;
    8    (III) THE COMMISSIONER HAS REQUIRED SIGNIFICANT UPGRADE TO THE FACILI-
    9  TY'S PHYSICAL PLANT AND CONSIDERATION OF THE TRANSFER; AND
   10    (IV) THE COMMISSIONER HAS DETERMINED EACH OF THE FOLLOWING  CONDITIONS
   11  IS TRUE:
   12    (1) THERE IS A CONTINUING NEED FOR THE BEDS AT THEIR CURRENT LOCATION;
   13    (2) THE ESTIMATED TOTAL PROJECT COST FOR NEW CONSTRUCTION OF A FACILI-
   14  TY  OF  THE SAME BED CAPACITY IN THE AREA WOULD SUBSTANTIALLY EXCEED THE
   15  COMBINED PURCHASE PRICE AND TOTAL PROJECT COST FOR  APPROVED  RENOVATION
   16  COSTS OF THE REVALUED FACILITY;
   17    (3) THE PURCHASE PRICE IS REASONABLE; AND
   18    (4) THE SALE OF THE FACILITY IS IN THE PUBLIC INTEREST.
   19    S  2.  This act shall take effect immediately; provided, however, that
   20  the amendments to paragraph (d) of subdivision 2-a of  section  2808  of
   21  the  public  health law made by section one of this act shall not affect
   22  the expiration of such paragraph and shall be deemed  to  expire  there-
   23  with.